10

TAX INVOICE, CREDIT

AND DEBIT NOTES
The section numbers referred to in the Chapter pertain to CGST Act, unless
otherwise specified.

LEARNING OUTCOMES

This Chapter will equip you to –

 describe and analyse the provisions relating to tax invoice in case of taxable
supply of goods and in case of taxable supply of services - time-limit and
manner of issuing the same
 enumerate the particulars of a tax invoice
 understand the provisions relating to e-invoicing
 explain the provisions relating to revised tax invoice, bill of supply, receipt
voucher, refund voucher, payment voucher, etc.
 explain the provisions relating to transportation of goods without issuance
of invoice
 describe the provisions relating to issuance of credit and debit notes
 explain the provisions relating to prohibition of unauthorised collection of tax
 describe the provisions relating to amount of tax to be indicated in tax
invoice and other documents.

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 10.2 GOODS AND SERVICES TAX

1. INTRODUCTION
An invoice is a commercial
instrument issued by a supplier of
goods/services to a recipient. It
identifies both the parties involved,
and lists, describes the items sold/services supplied, quantifies the items sold,
shows the date of shipment and mode of transport, prices and discounts, if any,
and the delivery and payment terms (in case of supply of goods).

Invoicing is very crucial aspect for ensuring tax compliance under

any indirect taxation system. In order to ensure transparency,
issuance of invoice for every taxable transaction is a pre-requisite.
In case of supply of goods or provision of services, an invoice is
raised by the supplier of such goods or services to the recipient of
the same. Tax invoice acts as a document evidencing the payment of the value
of the goods or services or both as also the tax portion in the same. In certain
cases, an invoice serves as a demand for payment and becomes a document of
title when paid in full.
Under the GST regime, an “invoice” or “tax invoice” means the tax invoice
referred to in section 31 of the CGST Act, 2017. This section mandates the
issuance of an invoice or a bill of supply for every supply of goods or services.
Under GST, a tax invoice is an important document. It not only evidences supply
of goods or services, but is also an essential document for the recipient to avail
Input Tax Credit (ITC). A registered person cannot avail input tax credit unless he
is in possession of a tax invoice or a debit note.

The provisions relating to tax invoices, debit and credit notes are contained in
Chapter VII - Tax Invoice, Credit and Debit Notes [Sections 31 to 34] of the CGST
Act and Chapter-VI: Tax Invoice, Credit and Debit Notes [Rules 46 to 55A] of
Central Goods and Services (CGST) Rules, 2017. State GST laws also prescribe
identical provisions in relation to Tax Invoice, Credit and Debit Notes.

Provisions of Tax invoice, Credit and Debit Notes under CGST Act have also
been made applicable to IGST Act vide section 20 of the IGST Act.

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 TAX INVOICE, CREDIT AND DEBIT NOTES 10.3

Before proceeding to understand the provisions of Tax Invoice, Credit and Debit
Notes, let us first go through few relevant definitions.

2. RELEVANT DEFINITIONS

 Credit note: means a document issued by a registered person under

sub-section (1) of section 34 [Section 2(37)].
 Debit note: means a document issued by a registered person under
sub-section (3) of section 34 [Section 2(38)].
 Continuous supply of goods: means [Section 2(32)]:

a supply of goods which is provided, or agreed to be provided,

continuously or on recurrent basis
under a contract

whether or not by means of a wire, cable, pipeline or other conduit, and

for which the supplier invoices the recipient on a regular or periodic basis
and
includes supply of such goods as the Government may, subject to such
conditions, as it may, by notification, specify

 Continuous supply of services: means [Section 2(33)]:

supply of services which is provided, or agreed to be provided,

continuously or on recurrent basis
under a contract
for a period exceeding 3 months with periodic payment obligations and
includes supply of such services as the Government may, subject to such
conditions, as it may, by notification, specify

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 10.4 GOODS AND SERVICES TAX

 Document: includes written or printed record of any sort and electronic

record as defined in clause (t) of section 2 of the Information
Technology Act, 2000 [Section 2(41)]. Information Technology Act
defines electronic record as data, record or data generated, image or
sound stored, received or sent in an electronic form or micro film or
computer generated micro fiche.
 Exempt supply: means supply of any goods or services or both which
attracts nil rate of tax or which may be wholly exempt from tax under
section 11, or under section 6 of the Integrated Goods and Services Tax
Act, and includes non-taxable supply [Section 2(47)].
 Invoice or tax invoice: means the tax invoice referred to in section 31
(discussed subsequently) [Section 2(66)].
 Quarter: shall mean a period comprising three consecutive calendar
months, ending on the last day of March, June, September and
December of a calendar year [Section 2(92)].
 Return: means any return prescribed or otherwise required to be furnished
by or under this Act or the rules made thereunder [Section 2(97)].

3. TAX INVOICE [SECTION 31]

STATUTORY PROVISIONS

Section 31 Tax invoice

Sub-section Particulars
(1) A registered person supplying taxable goods shall, before or at
the time of,—
(a) removal of goods for supply to the recipient, where the
supply involves movement of goods; or
(b) delivery of goods or making available thereof to the
recipient, in any other case
issue a tax invoice showing the description, quantity and value of
goods, the tax charged thereon and such other particulars as
may be prescribed:
Provided that the Government may, on the recommendations of
the Council, by notification, specify the categories of goods or

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 TAX INVOICE, CREDIT AND DEBIT NOTES 10.5

supplies in respect of which a tax invoice shall be issued, within

such time and in such manner as may be prescribed.
(2) A registered person supplying taxable services shall, before or
after the provision of service but within a prescribed period, issue
a tax invoice, showing the description, value, tax charged
thereon and such other particulars as may be prescribed.
Provided that the Government may, on the
recommendations of the Council, by notification—
(a) specify the categories of services or supplies in respect
of which a tax invoice shall be issued, within such
time and in such manner as may be prescribed;
(b) subject to the condition mentioned therein, specify the
categories of services in respect of which—
(i) any other document issued in relation to the
supply shall be deemed to be a tax invoice; or
(ii) tax invoice may not be issued.
(3) Notwithstanding anything contained in sub-sections (1) and (2)–
(a) a registered person may, within one month from the date
of issuance of certificate of registration and in such
manner as may be prescribed, issue a revised invoice
against the invoice already issued during the period
beginning with the effective date of registration till the
date of issuance of certificate of registration to him;
(b) a registered person may not issue a tax invoice if the value
of the goods or services or both supplied is less than two
hundred rupees subject to such conditions and in such
manner as may be prescribed;
(c) a registered person supplying exempted goods or services
or both or paying tax under the provisions of section 10
shall issue, instead of a tax invoice, a bill of supply
containing such particulars and in such manner as may be
prescribed:
Provided that the registered person may not issue a bill of supply
if the value of the goods or services or both supplied is less than
two hundred rupees subject to such conditions and in such
manner as may be prescribed;
(d) a registered person shall, on receipt of advance payment

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 10.6 GOODS AND SERVICES TAX

with respect to any supply of goods or services or both, issue

a receipt voucher or any other document, containing such
particulars as may be prescribed, evidencing receipt of such
payment;
(e) where, on receipt of advance payment with respect to any
supply of goods or services or both the registered person
issues a receipt voucher, but subsequently no supply is made
and no tax invoice is issued in pursuance thereof, the said
registered person may issue to the person who had made the
payment, a refund voucher against such payment;
(f) a registered person who is liable to pay tax under sub-
section (3) or sub-section (4) of section 9 shall issue an
invoice in respect of goods or services or both received by
him from the supplier who is not registered on the date of
receipt of goods or services or both;
(g) a registered person who is liable to pay tax under sub-section
(3) or sub-section (4) of section 9 shall issue a payment
voucher at the time of making payment to the supplier.
(4) In case of continuous supply of goods, where successive
statements of accounts or successive payments are involved, the
invoice shall be issued before or at the time each such statement
is issued or, as the case may be, each such payment is received.
(5) Subject to the provisions of clause (d) of sub-section (3), in case
of continuous supply of services,––
(a) where the due date of payment is ascertainable from the
contract, the invoice shall be issued on or before the due
date of payment;
(b) where the due date of payment is not ascertainable from the
contract, the invoice shall be issued before or at the time
when the supplier of service receives the payment;
(c) where the payment is linked to the completion of an event,
the invoice shall be issued on or before the date of
completion of that event.
(6) In a case where the supply of services ceases under a contract
before the completion of the supply, the invoice shall be issued
at the time when the supply ceases and such invoice shall be
issued to the extent of the supply made before such cessation.

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 TAX INVOICE, CREDIT AND DEBIT NOTES 10.7

(7) Notwithstanding anything contained in sub-section (1), where

the goods being sent or taken on approval for sale or return are
removed before the supply takes place, the invoice shall be
issued before or at the time of supply or six months from the
date of removal, whichever is earlier.
Explanation.––For the purposes of this section, the expression “tax invoice” shall
include any revised invoice issued by the supplier in respect of a supply made
earlier.
Section 31A Facility of digital payment to recipient
The Government may, on the recommendations of the Council,
prescribe a class of registered persons who shall provide
prescribed modes of electronic payment to the recipient of supply
of goods or services or both made by him and give option to
such recipient to make payment accordingly, in such manner
and subject to such conditions and restrictions, as may be
prescribed.

ANALYSIS
The provisions relating to Tax
Invoice are provided under
section 31 of the CGST Act as
well as Chapter-VI: Tax Invoice,
Credit and Debit Notes of Central
Goods and Services (CGST) Rules, 2017. The
provisions contained in these rules have been
incorporated at the relevant places.
There is no format prescribed for the Tax Invoice. Only certain fields have been
prescribed as mandatory fields.
A. TAX INVOICE ISSUED BY A SUPPLIER OF TAXABLE GOODS/ TAXABLE
SERVICES
A tax invoice shall be issued by a registered person
supplying taxable goods or taxable services or both.

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 10.8 GOODS AND SERVICES TAX

Such tax invoice shall show the prescribed particulars.

(i) Time limit for issuance of invoice [Sections 31(1), (2), (4) & (5) read
with rule 47]
The time for issuing an invoice would depend on the nature of supply viz.
whether it is a supply of goods or supply of services.
A registered person supplying taxable goods shall issue a tax invoice, before
or at the time of removal of goods (where supply involves movement of
goods) or in any other case, before or at the time of delivery or making
available thereof to the recipient.
In case of supply of taxable services, tax invoice may be issued before or
after the provision of services, but within the specified period.
Government may notify the categories of services in respect of which
any other document issued in relation to supply shall be deemed to be a
tax invoice or tax invoice may not be issued subject to specified
conditions.
The Government may, on the recommendations of the Council, by
notification, specify the categories of goods or services supplies in
respect of which a tax invoice shall be issued, within such time and in
such manner as may be prescribed.

In case of taxable In case of taxable supply of services

supply of goods

Invoice shall be Invoice shall be issued before or after the

issued before or at provision of service, but within a period of 30
the time of,— days* from the date of supply of service.

(a) removal of *45 days in case of an insurer or banking

goods for company or financial institution, including a
supply to the non- banking financial company (NBFC)
recipient, where
the supply
involves
movement of
goods; or

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 TAX INVOICE, CREDIT AND DEBIT NOTES 10.9

(b) delivery of An insurer or a banking company or a

goods or financial institution, including NBFC, or a
making telecom operator, or any other class of
available supplier of services as may be notified by the
thereof to the Government, making taxable supplies of
services between distinct persons as specified
recipient, in any
in section 25
other case.

In case of In case of continuous supply of services

continuous supply
of goods
Where successive Where the invoice shall be
statements of issued
accounts/
(a) due date of on or before the due
successive
payment is date of payment
payments are
ascertainable from
involved, the
the contract
invoice shall be
issued before/at the (b) due date of before or at the time
time each such payment is not when the supplier of
statement is issued ascertainable from service receives the
or each such the contract payment
payment is
(c) payment is linked on or before the date
received.
to the completion of of completion of
an event that event.

(1) Ritu Manufacturers, Delhi supplies goods to Prakhar

Electronics, Haryana. The goods were removed from its factory in
Delhi on 23rd September. Ritu Manufacturers needs to issue a tax
invoice on or before 23rd September.

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 10.10 GOODS AND SERVICES TAX

(2) Katyani Security Services Ltd. provides security services to

Royal Jewellers for their Jewellery Exhibition to be organized on 5th
October. Katyani Security Services Ltd. needs to issue a tax invoice
within 30 days of supply of security services, i.e. on or before 4th November.
(ii) Where supply of services ceases before its completion [Section 31(6)]
In a case where the supply of services ceases under a
contract before the completion of the supply, the invoice
shall be issued at the time when the supply ceases and
such invoice shall be issued to the extent of the supply
made before such cessation.
(iii) Goods sent on sale or return basis [Section 31(7)]
Where the goods being sent or taken on approval for sale or return are
removed before the supply takes place, the invoice shall be issued:
(i) before/at the time of supply
or
(ii) 6 months from the date of removal
whichever is earlier.
The goods which are taken for supply on approval basis can be moved
from the place of business of the registered supplier to another place
within the same State or to a place outside the State on a delivery challan
[discussed subsequently in this Chapter in detail] along with the e-way bill 1
wherever applicable. The invoice may be issued at the time of delivery of
goods. For this purpose, the person carrying the goods for such supply
can carry the invoice book with him so that he can issue the invoice in
accordance within the time stipulated above, once the supply is fructified.
Goods sent/ taken out of India for exhibition or on consignment basis for
export promotion
Sometimes the goods are sent or taken out of India for exhibition or on
consignment basis for export promotion. The activity of sending/ taking the
goods out of India for exhibition or on consignment basis for export

1
E-way bill is a document which is required to be carried by the person-in charge of the
conveyance for the movement of goods from the supplier’s premises to the recipient’s premises.
Detailed provisions have been discussed in Chapter 11 – Accounts and Records; E-way Bill in
this Module of the Study Material.

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 TAX INVOICE, CREDIT AND DEBIT NOTES 10.11

promotion, except when such activity satisfy the tests laid down in Schedule I
(hereinafter referred to as specified goods), do not constitute supply as the
said activity does not fall within the scope of section 7 as there is no
consideration at that point in time.
The specified goods sent/taken out of India are required to be either sold or
brought back within the stipulated period of 6 months from the date of
removal as per the provisions contained in section 31(7).
The supply would be deemed to have taken place, on the expiry of 6 months
from the date of removal, if the specified goods are neither sold abroad nor
brought back within the said period.
If the specified goods are sold abroad, fully or partially, within the
specified period of 6 months, the supply is effected, in respect of quantity so
sold, on the date of such sale. In that case, the sender shall issue a tax invoice
in respect of such quantity of specified goods which has been sold abroad, in
accordance with the provisions contained in section 12 and section 31 read
with rule 46.
When the specified goods sent / taken out of India have neither been sold nor
brought back, either fully or partially, within the stipulated period of 6 months,
as laid down in section 31(7), the sender shall issue a tax invoice on the date of
expiry of 6 months from the date of removal, in respect of such quantity of
specified goods which have neither been sold nor brought back, in accordance
with the provisions contained in section 12 and section 31 read with rule 46
[Circular No. 108/27/2019 GST dated 18.07.2019].
The above position is explained by way of example below:
(3) M/s. ABC sends 100 units of specified goods out of India. The
activity of merely sending/ taking such specified goods out of India is
not a supply. No tax invoice is required to be issued in this case, but
the specified goods shall be accompanied with a delivery challan issued in
accordance with the provisions contained in rule 55.
In case the entire quantity of specified goods is brought back within the
stipulated period of 6 months from the date of removal, no tax invoice is
required to be issued as no supply has taken place in such a case.
In case, however, the entire quantity of specified goods is neither sold nor
brought back within 6 months from the date of removal, a tax invoice would be
required to be issued for entire 100 units of specified goods in accordance with

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 10.12 GOODS AND SERVICES TAX

the provisions contained in section 12 and section 31 with rule 46 within the
time period stipulated under section 31(7).
(iv) Particulars of a tax invoice [Sections 31(1) & (2) read with rule 46]
As discussed earlier, there is no format prescribed for an invoice, but rules
make it mandatory for an invoice to have the following fields (only
applicable fields are to be filled):

Name, address and GSTIN of the supplier;

A consecutive serial number not exceeding 16 characters, in one or

multiple series, containing alphabets/numerals/special characters hyphen
or dash and slash, and any combination thereof, unique for a FY;

Date of its issue;

If recipient is registered - Name, address and GSTIN or UIN of

recipient

If recipient is unregistered Particulars of invoice

and value of supply is

` 50,000 or more Name and address of the recipient

and the address of delivery, along
with the name of State and its code

less than ` 50,000 unregistered recipient may still

request the aforesaid details to be
recorded in the tax invoice

HSN code for goods or services;

Description of goods or services;

Quantity in case of goods and unit or Unique Quantity Code thereof;

Total value of supply of goods or services or both;

Taxable value of supply of goods or services or both taking into

account discount or abatement, if any;

Rate of tax (central tax, State tax, integrated tax, Union territory tax or
cess);

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 TAX INVOICE, CREDIT AND DEBIT NOTES 10.13

Amount of tax charged in respect of taxable goods or services (central

tax, State tax, integrated tax, Union territory tax or cess);

Place of supply along with the name of State, in case of a supply in the
course of inter-State trade or commerce;

Address of delivery where the same is different from the place of supply;

Whether the tax is payable on reverse charge basis; and

Signature or digital signature of the supplier or his authorized

representative
( not required in case of issuance of an electronic invoice in
accordance with the provisions of the Information Technology (IT) Act,
2000).

Quick Response code, having embedded Invoice Reference Number (IRN)

in it, in case e-invoice has been issued 2

(v) Number of HSN digits required on tax invoice and class of registered
person not required to mention HSN [Rule 46]
Board may, on the recommendations of the
Council, by notification, specify:
(i) the number of digits of Harmonised System
of Nomenclature (HSN) code for goods or
services that a class of registered persons shall be required to
mention; or
(ii) a class of supply of goods or services for which specified number of
digits of HSN code shall be required to be mentioned by all registered
taxpayers; and
(iii) the class of registered persons that would not be required to mention
the HSN code for goods or services.
This provision is also applicable to Bill of Supply [The concept of Bill of Supply
is discussed in subsequent paras].
In view of above powers, following has been notified vide Notification No.
12/2017 CT dated 28.06.2017 as amended:

2
in the manner prescribed under rule 48(4)

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 10.14 GOODS AND SERVICES TAX

S.No. Annual Turnover (AT) Number of Digits of HSN Code

in the preceding FY

1. AT ≤` 5 crores For B2B supply - 4

For B2C supply – 4 (optional)*

2. AT >` 5 crores For B2B supply and B2C supply – 6

*As mentioned above, a registered person having aggregate turnover up to

` 5 crores in the previous financial year has been exempted from the
requirement of mentioning the HSN Code in the manner specified in above
table in a tax invoice issued by him under the said rules in respect of
supplies made to unregistered persons.
(vi) Manner of issuing the invoice [Sections 31(1) & (2) read with rule 48]

In case of taxable supply of In case of taxable supply of

goods services

Invoice shall be prepared in Invoice shall be prepared in

TRIPLICATE DUPLICATE

Triplicate Duplicate

Original copy
Original copy

Duplicate copy
Duplicate
copy
Triplicate copy

The serial number of invoices issued during a tax period shall be furnished
electronically [through the Common Portal – www.gst.gov.in], in FORM
GSTR-1 [Details of outward Supplies of goods or services].

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 TAX INVOICE, CREDIT AND DEBIT NOTES 10.15

(vii) Invoice in case of export of goods or services [Third proviso to rule 46]
In the case of the export of goods or services, the invoice shall carry an
endorsement “SUPPLY MEANT FOR EXPORT/ SUPPLY TO SEZ UNIT/SEZ
DEVELOPER FOR AUTHORISED OPERATIONS ON PAYMENT OF INTEGRATED
TAX” or “SUPPLY MEANT FOR EXPORT / SUPPLY TO SEZ UNIT/SEZ
DEVELOPER FOR AUTHORISED OPERATIONS UNDER BOND OR LETTER OF
UNDERTAKING WITHOUT PAYMENT OF INTEGRATED TAX”, as the case may
be.

It is important to note that particulars of an Export Invoice are same as a Tax

Invoice. However, where recipient is unregistered and value of supply is
` 50,000 or more, instead of name of State and its code, in case of an
export invoice, name of the country of destination is to be mentioned.

Key points from aforesaid discussion have been summarized as

follows:
1. All GST taxpayers are free to design their own Tax Invoice Format.
2. The law requires that only certain fields as mandatory fields in the Tax
Invoice. The same have been listed under heading (iv) above. The
mandatory fields have also been circled in the Sample Tax Invoice
given subsequently.
3. The time period for issuance of invoice is different for goods and
services. For goods, it is any time before or at its delivery and for
services, it is within 30 days from the date of supply of services.

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 10.16 GOODS AND SERVICES TAX

Sample Tax Invoice

E-invoicing
E-invoicing' has been introduced for reporting of business to business
(B2B) invoices to GST System for certain notified category of taxpayers.
All registered businesses with an
aggregate turnover (based on
PAN) in any preceding financial
year from 2017-18 onwards greater
than ` 50 crore (hereinafter
referred to as ‘notified persons’)
will be required to issue e-
invoices. E-invoicing is not
voluntary; only notified persons are enabled to report invoices on IRP.

Before we proceed further, let us

first understand what is
‘e-invoicing’? E-invoicing is not
generation of invoice by a
Government portal. Taxpayers
will continue to create their GST

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 TAX INVOICE, CREDIT AND DEBIT NOTES 10.17

invoices on their own Accounting/Billing/ERP Systems as per e-invoice

schema. These invoices will then be reported to ‘Invoice Registration Portal
(IRP)’. On such reporting, IRP will generate a unique ‘Invoice Reference
Number (IRN)’, digitally sign it and return the e-invoice to the supplier. A
GST e-invoice will be valid only with a valid IRN.

Presently, invoices, credit notes and debit notes, when issued by notified
persons (to registered persons (B2B) or for the purpose of exports) are
covered under
e-invoice. Though different
documents are covered, for
ease of reference and
understanding, the system is
referred as
‘e-invoicing’.

Advantages of e-invoicing

E-invoice has many advantages for businesses. One such advantage is

auto-reporting of invoices into GST return and auto-generation of
e-way bill (wherever required). Under e-invoicing, business has to report the
B2B invoice data only once in the e-invoice form and the same is reported
in multiple forms (GSTR-1, e-way bill etc.). E-way bill can be auto-generated
using e-invoice data. GSTR-1 can also be auto-populated with the e-invoice
data. It will become part of the business
process of the taxpayer.

Consequently, there will be a substantial

reduction in transcription errors as same
data will get reported to tax department
as well as to the buyer to prepare his
inward supplies (purchase) register. On
receipt of information through GST
System, buyer can do reconciliation with
his Purchase Order.

Thus, it will facilitate standardisation and inter-operability leading to

reduction of disputes among transacting parties, improve payment cycles,

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 10.18 GOODS AND SERVICES TAX

reduction of processing costs and thereby greatly improving overall

business efficiency.

Further, since a complete trail of B2B invoices is available with the

Department, it will enable the system-level matching of input tax credit and
output tax thereby reducing the tax evasion.

Last but not the least, e-invoicing will eliminate the fake invoices. Claiming
fictitious input tax credit (ITC) by raising fake invoices is also one of the
biggest challenges currently faced by tax-authorities. The e-invoice system
will help to curb the actions of unscrupulous taxpayers and reduce the
number of fraud cases as the tax authorities will have access to data in real-
time.

E-invoicing statutory provisions

Rule 48(4) stipulates that the e-invoice shall be prepared by notified class of
registered persons, by uploading such particulars as contained in
Form GST INV-01 on the Common GST Electronic Portal 3 and obtain an IRN
(Invoice Reference Number), in prescribed manner and subject to prescribed
conditions and restrictions.

However, the Commissioner may, on the recommendations of the Council,

by notification, exempt a person or a class of registered persons from
issuance of e-invoice under
rule 48(4) for a specified
period, subject to such
conditions and restrictions as
may be specified in the said
notification.

Every invoice, issued by above

persons, in any manner other than the manner specified in rule 48(4) shall
not be treated as an invoice. Where e-invoicing is applicable, there is no
need of issuing invoice copies in triplicate/duplicate.

3
10 dedicated Invoice Reference Portals have been notified as Common Goods and Service
Tax (GST) Electronic Portal for the purpose of preparing e-invoice. These portals are
enlisted in subsequent paras.

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 TAX INVOICE, CREDIT AND DEBIT NOTES 10.19

Class of persons notified to mandatorily issue e-invoice

In view of said powers, a registered person (except specified class of

persons 4), whose aggregate turnover in any preceding financial year from
2017-18 onwards exceeds ` 50 crores, has been notified as class of persons
who shall prepare e-invoice in respect of B2B supplies (supply of goods or
services or both to a registered person) or for exports 5. Thus, presently,
such notified persons are not required to report B2C invoices on IRP.
However, reporting of B2C invoices will be brought under e-invoice in the
next phase. However, they will be brought under e-invoice in the next
phase. Further, e-invoicing is also not applicable to invoices issued by Input
Service Distributor (ISD).

If the invoice issued by a notified person is in respect of supplies made by

him, tax on which is payable under reverse charge under section 9(3),
e-invoicing is applicable.

(4) A taxpayer (say a firm of advocates) having aggregate turnover

in a FY of more than ` 50 crore is supplying services to a company
(who will be discharging tax liability as recipient under reverse
charge mechanism), such invoices have to be reported by said tax payer
(since it is a notified person) to IRP.

On the other hand, where specified category of supplies are received by

notified person from unregistered persons [attracting reverse charge under
section 9(4)] or through import of services, e-invoicing doesn’t arise/ not
applicable. E-invoicing is also not applicable for import of goods (Bills of
Entry).

Exemption from e-invoicing

Following entities are exempt from the mandatory requirement of

e-invoicing:

4
Special Economic Zones and insurer or banking company or financial institution including
NBFC, GTA, supplier of passenger transportation service, person supplying services by way
of admission to exhibition of cinematograph films in multiplex screens
5
vide Notification No. 13/2020 CT dated 21.03.2020 as amended

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 10.20 GOODS AND SERVICES TAX

 Special Economic Zone units**

 Insurer or banking company or financial institution including NBFC

 GTA supplying services in relation to transportation of goods by road

in a goods carriage

 Supplier of passenger transportation service

 Person supplying services by way of admission to exhibition of

cinematograph films in multiplex screens

Thus, above mentioned entities are not required to issue e-invoices even if
their turnover exceeds ` 50 crore in the preceding financial year from
2017-18 onwards.

**It is important to note here that only SEZ units and not SEZ developers are
exempt from issuing e-invoices. Thus, SEZ developers whose turnover
exceeds ` 50 crore in any preceding financial year from 2017-18 onwards
are mandatorily required to issue e-invoices. Further, in case of supplies
made by notified persons to SEZ units, e-invoices need to be issued.
(5) Maharaja Private Limited has an SEZ unit and a regular DTA
unit (both having same PAN). The aggregate total turnover of
Maharaja Private Limited is more than ` 50 crores (considering
both the GSTINs). However, the turnover of DTA unit is ` 20 crores for
preceding financial year.
In this scenario, SEZ unit is exempt from e -invoicing. However, e-invoicing
will be applicable to DTA Unit because the aggregate turnover of Maharaja
Private Limited in this case is > ` 50 crores. The eligibility is based on
aggregate annual turnover on the common PAN.

How e-invoice is generated?

The taxpayer first prepares and generates his invoice using his own ERP/
accounting/ billing system or manual system 6. The invoice must conform to

6
For entities not having their own ERP/Software solutions, they can use the free offline
utility (‘bulk generation tool’) downloadable from the e-invoice portal. Through this, invoice
data can be easily reported to IRP and obtain IRN/signed e-invoice

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 TAX INVOICE, CREDIT AND DEBIT NOTES 10.21

the e-invoice schema (It is a standard notified format which is discussed in

detail subsequent paras) and must have the mandatory parameters.

The details of this invoice are uploaded/reported by the taxpayer to the

Invoice Registration Portal (IRP). This way taxpayer registers his supply
transaction on IRP. On uploading, IRP returns the e-invoice with a unique
‘Invoice Reference Number (IRN)’ (explained in detail subsequent paras)
after digitally signing the e-invoice and adding a QR Code (Quick Response
Code). Then, the supplier shares the e-invoice with the receiver (along with
QR Code).

How e-invoice data is consumed by GST System for generation of

e-way bill or populating relevant parts GST Returns?
IRP sends the e-invoice data along with IRN 7 to the GST System as well as to
e-way bill system.

7
This IRN is same as that has been returned by the IRP to the seller.

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 10.22 GOODS AND SERVICES TAX

The GST system will auto-populate them into GSTR-1 of the supplier and
GSTR-2A of respective receivers. With source marked as ‘e-invoice’, IRN and
IRN date will also be shown in GSTR-1 and GSTR-2A.
The e-invoice schema (discussed subsequently) includes parameters e.g.
‘Transporter ID’ and ‘Vehicle Number’, etc. that are required for creating and
generating e-way bills. These can be entered if available with seller, at the time
of generation of e-invoice so that e-way bill can be created using this data
without any further requirement of data entry by the user. The e-invoice
reporting software already allows reporting of e-invoice and generation of
e-way bill with same data.
Cancellation/amendment of reported invoice
Where needed, the seller can cancel IRN for an e-invoice already reported by
reporting it on IRP within specified time. Amendment of e-invoice already
uploaded on IRP will be done only on GST portal (while filing GSTR-1).
Amendment of invoices is not possible through the IRP.
Implications for businesses
As apparent from the above discussion, e-invoicing does not mean that the
invoice needs to be prepared/generated on the Government portal. It is
only intimating the Government portal that invoice has been issued to the
buyer, by registering that particular invoice on the Government portal.
Consequently, businesses will continue to issue invoices as they were doing
earlier. Necessary changes on account of e-invoicing requirement (i.e. to
enable reporting of invoices to IRP and obtain IRN), be made by
ERP/Accounting and Billing Software providers in their respective software.
They need to get the updated version having this facility.
Important terms
E-invoice Schema
Businesses use various accounting/billing software, each generating and
storing invoices in their own electronic formats. These different formats are
neither understood by GST System nor by the systems of suppliers and
receivers.
(6) An invoice generated by SAP system cannot be read by a
machine which is using ‘Tally’ system, unless a connector is used.
With more than 300 accounting/billing software products, there
was no way to have connectors for all.

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 TAX INVOICE, CREDIT AND DEBIT NOTES 10.23

In this scenario, ‘e-invoicing’ was introduced aiming at machine-readability and

uniform interpretation. To ensure this complete ‘inter-operability’ of e-invoices
across the entire GST eco-system, an invoice standard is a must. By this,
e-invoices generated by one software can be read by any other software,
thereby eliminating the need of fresh/manual data entry. Since there was no
such standard for e-invoice available earlier, as a first step, a standard/format
for e-invoice has been finalized.
This uniform standard format (containing specified fields) applicable for all
the businesses across the country is known as ‘e-invoice schema’. It is
notified as Form GST INV-1. E-invoice schema mandates what particulars
shall be reported in electronic format to IRP. Invoice details in prescribed
schema to be reported to IRP in JSON format (JavaScript Object Notation).
‘JSON’ can be understood as a common language for systems/machines to
communicate between each other and exchange data.
Invoice Registration Portal (IRP)
IRP is the website for uploading/reporting of invoices by the notified persons.
Following IRPs have been notified for the purpose of preparation of the
e-invoice:
www.einvoice1.gst.gov.in
www.einvoice2.gst.gov.in
www.einvoice3.gst.gov.in
www.einvoice4.gst.gov.in
www.einvoice5.gst.gov.in
www.einvoice6.gst.gov.in
www.einvoice7.gst.gov.in
www.einvoice8.gst.gov.in
www.einvoice9.gst.gov.in
www.einvoice10.gst.gov.in
Invoice Reference Number
As seen earlier, GST invoice will be valid only with a valid IRN. IRN is
different from invoice number. Invoice no. (e.g. ABC/1/2019-20) is assigned
by supplier and is internal to business. Its format can differ from business to
business and also governed by relevant GST rules. IRN, on other hand, is a

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 10.24 GOODS AND SERVICES TAX

unique reference number (hash) generated and returned by IRP, on

successful registration of e-invoice, for instance,
35054cc24d97033afc24f49ec4444dbab81f542c555f9d30359dc75794e06bbe
The overall work flow of e-invoice generation, its reporting/registration and
receipt of confirmation is depicted in the diagrams below:
A. Interaction between the business (supplier) and the Invoice
Registration Portal (IRP).

B. Interaction between the IRP and the GST/E-Way Bill Systems and
the Buyer.

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 TAX INVOICE, CREDIT AND DEBIT NOTES 10.25

Other points:
 The e-invoicing system is also available for the E-Commerce Operators
(ECO) to report the invoices to the Invoice Registration portal, generated
by them on behalf of the suppliers.
 Bulk uploading of invoices to IRP is also possible 8.
Quick Response (QR) code
Upon successful registration of invoice on IRP, it will return a
signed e-invoice to the supplier with IRN and QR Code. IRN
is embedded in the QR Code which shall be extracted and
printed on the invoice. The QR code enables quick view,
validation and access of the invoices from the GST system
from hand-held devices. The digitally signed QR code will have a unique IRN
which can be verified on the central portal as well as by an offline app by
the officer. This will be helpful for tax officers checking the invoice offline on
the roadside where internet may not be available all the time.
The QR code consists of the following e-invoice parameters:
 GSTIN of supplier

 GSTIN of recipient
 Invoice number as given by supplier
 Date of generation of invoice

 Invoice value (taxable value and gross tax)

 Number of line items
 HSN code of main item (the line item having highest taxable value)

 Unique Invoice Reference Number (hash)

 Date of generation of IRN

8
Discussion on e-invoicing is primarily based on the relevant rules, notifications and FAQS on
e-invoicing hosted on GSTN website.

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 10.26 GOODS AND SERVICES TAX

Dynamic QR code on B2C invoices

All B2C invoices issued by a registered person whose aggregate

turnover in any preceding financial year from 2017-18 onwards exceeds
` 500 crores will have a QR code.
Sixth proviso to rule 46 has empowered the Government to specify that the
tax invoice shall have Quick Response (QR) code. Resultantly, it has been
notified 9 that invoice issued by a registered person [except specified class of
persons (discussed subsequently)], whose aggregate turnover in a financial
year exceeds ` 500 crores, in respect of B2C supplies (supply of goods or
services or both to an unregistered person) shall have Dynamic QR code.

A Dynamic Quick Response (QR) code made available to buyer by such

registered person through digital display (with payment cross-reference)
shall be deemed to be having QR code. The purpose of this provision is to
enable and encourage digital payments where buyer can scan the
dynamic QR code and make payment from mobile wallet directly.
Today, many shops have static QR code at the payment counter which is
scanned by the buyer, but the buyer has to enter the amount to be paid to
the shop in the mobile payment App. The dynamic QR code, on the other
hand, will have the payment details and thus ‘scan and pay’ in one go is
possible.
This has no relevance or applicability to the e-invoicing in respect to
B2B supplies by notified class of taxpayers. Dynamic QR Code will be
generated by the seller himself either on the Point of Sale (PoS) machine or
the invoice issued.
Non-applicability of requirement of Dynamic QR code
Dynamic QR code is not applicable to an invoice issued to an
unregistered person by following suppliers:
(i) Insurer or banking company or financial institution including
NBFC

(ii) Goods transport agency supplying services in relation to

transportation of goods by road in a goods carriage

9
vide Notification No. 14/2020 CT dated 21.03.2020

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 TAX INVOICE, CREDIT AND DEBIT NOTES 10.27

(iii) Supplier of passenger transportation service

(iv) Person supplying services by way of admission to exhibition of

cinematograph films in multiplex screens
(v) Supplier of online information and database access or retrieval
(OIDAR) services.
No Dynamic QR code in case of exports: As regards the supplies made
for exports, though such supplies are made by a registered person to an
unregistered person, however, since e-invoices are required to be issued
in respect of supplies for exports treating them as B2B supplies,
Dynamic QR code requirement will not be applicable to them.
Parameters/ details to be captured in the Dynamic QR Code
Dynamic QR Code, inter-alia, shall contain the following information: -
 Supplier GSTIN number
 Supplier UPI ID
 Payee’s Bank A/c number and IFSC
 Invoice number & invoice date,
 Total invoice value and
 GST amount along with breakup i.e. CGST, SGST, IGST, Cess, etc.
Further, Dynamic QR Code should be such that it can be scanned to
make a digital payment.
Compliance with the Dynamic QR Code requirements in certain cases
If the supplier has issued invoice having Dynamic QR Code for payment,
the said invoice shall be deemed to have complied with Dynamic QR
Code requirements. Compliance with the Dynamic QR Code
requirements has been examined in the following cases:

Case-I: If a supplier provides/ displays Dynamic QR Code, but the

customer opts to make payment without using Dynamic QR Code and
supplier provides the cross reference of such payment made without use
of Dynamic QR Code, on the invoice

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 10.28 GOODS AND SERVICES TAX

In cases where the supplier, has digitally displayed the Dynamic QR

Code and the customer pays for the invoice: -
i. using any mode like UPI, credit/ debit card or online banking or
cash or combination of various modes of payment, with or without
using Dynamic QR Code, and the supplier provides a cross
reference of the payment (transaction id along with date, time
and amount of payment, mode of payment like UPI, Credit card,
Debit card, online banking etc.) on the invoice; or
ii. in cash, without using Dynamic QR Code and the supplier provides
a cross reference of the amount paid in cash, along with date of
such payment on the invoice;
said invoice shall be deemed to have complied with the requirement of
having Dynamic QR Code.
Case-II: If a supplier makes available to customers an electronic mode
of payment like UPI Collect, UPI Intent or similar other modes of
payment, through mobile applications or computer-based applications,
where though Dynamic QR Code is not displayed, but the details of
merchant as well as transaction are displayed/ captured otherwise
In such cases, if the cross reference of the payment made using such
electronic modes of payment is made on the invoice, the invoice shall
be deemed to comply with the requirement of Dynamic QR Code.
However, if payment is made after generation/ issuance of invoice, the
supplier shall provide Dynamic QR Code on the invoice.
Case-III: In case of pre-paid invoices i.e. where payment has been made
before issuance of the invoice
If cross reference of the payment received either through electronic
mode or through cash or combination thereof is made on the invoice,
then the invoice would be deemed to have complied with the
requirement of Dynamic QR Code.
In cases other than pre-paid supply i.e. where payment is made after
generation / issuance of invoice, the supplier shall provide Dynamic QR
Code on the invoice.
Case-IV: In case where the e-commerce operator (ECO)/online
application has complied with the Dynamic QR Code requirements,

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 TAX INVOICE, CREDIT AND DEBIT NOTES 10.29

whether the suppliers using such e-commerce portal or application will

still be required to comply with the requirement of Dynamic QR Code?
Dynamic QR code requirements apply to each supplier/registered
person separately, if such person is liable to issue invoices with
Dynamic QR Code for B2C supplies.
In case, the supplier is making supply through the e- commerce portal
or application, and the said supplier gives cross references of the
payment received in respect of the said supply on the invoice, then such
invoices would be deemed to have complied with the requirements of
Dynamic QR Code. In cases other than pre-paid supply i.e. where
payment is made after generation / issuance of invoice, the supplier
shall provide Dynamic QR Code on the invoice 10.
B. SPECIAL CASES
(i) Revised Tax Invoice [Section 31(3)(a) read with rule 53]
When issued?
For the purposes of this
Every registered person who has been section, the expression
granted registration with effect from a date “tax invoice” shall include
earlier than the date of issuance of any revised invoice issued
certificate of registration to him, may issue by the supplier in respect
Revised Tax Invoices. Such invoices shall be of a supply made earlier
issued against the invoices already issued [Explanation to section 32].
during said period.
Revised Tax Invoices shall be issued within 1 month from the date of
issuance of certificate of registration. The words “Revised Invoice” shall be
indicated prominently on such invoices.
This provision is necessary, as a person who becomes liable for registration
has to apply for registration within 30 days of becoming liable for
registration. When such an application is made within the stipulated time
period and registration is granted, the effective date of registration is the
date on which the person became liable for registration.
Thus, there would be a time lag between the date of grant of certificate of

10
The discussion on Dynamic QR code is based primarily on sixth proviso to rule 46 alongwith
Notification No. 14/2020 CT dated 21.03.2020 and Circular No. 146/02/2021 GST dated
23.02.2021.

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 10.30 GOODS AND SERVICES TAX

registration and the effective date of registration. For supplies made by such
person during this intervening period, the law enables the issuance of a
revised invoice, so that ITC can be availed by the recipient on such supplies.

Revised Tax Invoices to be issued in respect of taxable

supplies effected during this period

Effective date of Date of issuance of

registration certificate of registration

(7) Sarabhai Private Ltd. commenced business of supply of goods

on 1st April in Delhi. Its turnover exceeded the applicable
threshold limit on 3rd September. Thus, it became liable to
registration on 3rd September. It applied for registration on 29th September
and was granted registration certificate on 5th October. Since it applied for
registration within 1 month of becoming liable to registration, registration
granted is effective from 3rd September.
Sarabhai Private Ltd. may issue Revised Tax Invoices on or before
5th November in respect of taxable supplies effected between 3rd September
and 5th October.
Consolidated Revised Tax Invoices in certain cases
A registered person may issue a Consolidated Revised Tax Invoice in respect of
all taxable supplies made to an unregistered recipient during such period.
Supply 1
Supply 2
Supply 3
Mr.A Supply 4 Mr. B
Registered Consolidated Revised Unregistered
Supplier Tax Invoice Recipient

Supplies between date of grant of certificate of registration & effective date of registration

However, in case of inter-State supplies, a consolidated Revised Tax

Invoice cannot be issued in respect of all unregistered recipients if the value
of a supply exceeds ` 2,50,000.

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 TAX INVOICE, CREDIT AND DEBIT NOTES 10.31

Particulars of Revised Tax Invoice

Name, address and GSTIN of the supplier;

A consecutive serial number not exceeding 16 characters, in one or

multiple series, containing alphabets or numerals or special characters -
hyphen or dash and slash and any combination thereof, unique for a FY;

Date of issue of the document;

Name, address and GSTIN or UIN, if registered, of the recipient;

Name and address of the recipient and the address of delivery, along
with the name of State and its code, if such recipient is un-registered;

Serial number and date of the corresponding tax invoice or, as the case
may be, bill of supply;

Signature/digital signature of the supplier/his authorized representative.

Note: Any invoice or debit note issued in pursuance of any tax payable in
accordance with the provisions of section 74 or section 129 or section 130
shall prominently contain the words “INPUT TAX CREDIT NOT
ADMISSIBLE”
Section 74 - Determination of tax not paid or short paid or erroneously
refunded or input tax credit wrongly availed or utilised by reason of fraud or any
wilful misstatement or suppression of facts 11
Section 129 - Detention, seizure and release of goods and conveyances in transit
Section 130 - Confiscation of goods or conveyances and levy of penalty 12
(ii) No Tax Invoice required to be issued if value < ` 200 – A consolidated
Tax Invoice can be issued [Section 31(3)(b) read with fourth proviso to
rule 46]
A registered person may not issue a Tax Invoice if:
(i) Value of the goods/services/both supplied < `200,

11
Provisions of section 74 have been discussed in detail in Chapter 19- Demands and Recovery
in Module 3 of the Study Material.
12
Provisions of sections 129 and 130 have been discussed in detail in Chapter 21- Offences and
Penalties in Module 3 of the Study Material.

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 10.32 GOODS AND SERVICES TAX

(ii) the recipient is unregistered; and

(iii) the recipient does not require such invoice.
Instead such registered person shall issue a Consolidated Tax Invoice for
such supplies at the close of each day in respect of all such supplies.
Thus, small taxpayers, like small retailers, doing a large number of small
transactions for upto a value of ` 200 per transaction to unregistered
customers need not issue invoice for every such transaction. They can issue
one consolidated invoice at the end of each day for all transactions done
during the day. However, they need to issue an invoice when the customer
demands.
However, this option is not available to a supplier engaged in making
supply of services by way of admission to exhibition of cinematograph films
in multiplex screens.
Above provision is also applicable to Bill of Supply.
(iii) Bill of Supply [Section 31(3)(c) read with rule 49]
Section 31(3)(c) stipulates that a registered person supplying exempted
goods or services or both or a registered person paying tax under
composition levy, shall issue a bill of supply instead of a tax invoice. Person
opting for composition levy shall mention the words “composition taxable
person, not eligible to collect tax on supplies” at the top of the bill of supply
issued by him 13.

Supplying exempted goods

or services or both

Registered
Person
Paying tax under composition
levy

13
Fourth proviso to rule 49 stipulates that the Bill of supply shall have a Quick Response
Code. However, the same is not yet made effective.

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 TAX INVOICE, CREDIT AND DEBIT NOTES 10.33

Particulars of Bill of Supply

A registered person opting for the composition levy does not
collect tax from the recipient on outward supplies made by him.
Similarly, in case of a registered person supplying exempted
goods and/or services, no tax implications are there. Recipients should not
expect Tax Invoice from such suppliers as they cannot issue tax invoice.
Since no tax is collected from the recipient by a registered person opting for
the composition levy and a registered person supplying exempted goods
and/or services, Bill of Supply issued by such persons does not contain the
details pertaining to rate of tax and amount of tax. Further, value to be
mentioned in the Bill of Supply is not also taxable value.

Name, address and GSTIN of the supplier;

A consecutive serial number not exceeding 16 characters, in one or more
multiple series, containing alphabets or numerals or special characters -
hyphen or dash and slash and any combination thereof, unique for a FY;
Date of its issue;
Name, address and GSTIN or UIN, if registered, of the recipient;
HSN Code for goods or services;
Description of goods or services or both;
Value of supply of goods or services or both taking into account
discount/ abatement, if any; and
Signature or digital signature of the supplier or his authorized
representative
( not required in case of issuance of an electronic bill of supply in
accordance with the provisions of the Information Technology (IT)
Act, 2000).
Note: Any tax invoice or any other similar document issued under any other
Act for the time being in force in respect of any non-taxable supply shall be
treated as bill of supply for the purposes of the Act.
(8) Patel & Sons is a manufacturer of goods who has opted for
composition levy under section 10(1) and (2). It will issue a Bill of
Supply to the buyers of goods and not the tax invoice.

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 10.34 GOODS AND SERVICES TAX

Invoice-cum-bill of supply [Rule 46A]

Where a registered person is supplying taxable as well as exempted goods
or services or both to an unregistered person, a single “invoice-cum-bill of
supply” may be issued for all such supplies. Rule 46A is notwithstanding
anything contained in rule 46 or rule 49 or rule 54 of CGST Rules.
(iv) Receipt Voucher [Section 31(3)(d) read with rule 50]
A registered person shall, on receipt of advance payment with respect to
any supply of goods or services or both, issue a Receipt Voucher evidencing
receipt of such payment.
Particulars of Receipt Voucher

Name, address and GSTIN of the supplier;

A consecutive serial number not exceeding 16 characters, in one or

multiple series, containing alphabets or numerals or special
characters -hyphen or dash and slash and any combination thereof,
unique for a FY

Date of its issue;

Name, address and GSTIN or UIN, if registered, of the recipient;

Description of goods or services;

Amount of advance taken;

Rate of tax (central tax, State tax, integrated tax, Union territory tax
or cess);

Amount of tax charged in respect of taxable goods or services

(central tax, State tax, integrated tax, Union territory tax or cess);

Place of supply along with the name of State and its code, in case of
a supply in the course of inter-State trade or commerce;

Whether the tax is payable on reverse charge basis; and

Signature/digital signature of supplier/his authorized representative

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 TAX INVOICE, CREDIT AND DEBIT NOTES 10.35

Where at the time of receipt of advance, rate of tax and/or nature of

supply is not determinable

Where at the time of receipt of

advance
(i) rate of tax is not tax shall be paid at the rate of 18%
determinable
(ii) nature of supply is not same shall be treated as inter-State
determinable supply

(v) Refund Voucher [Section 31(3)(e) read with rule 51]

Where, on receipt of advance payment with respect to any supply of goods
or services or both the registered person issues a Receipt Voucher, but
subsequently no supply is made and no tax invoice is issued in pursuance
thereof, the said registered person may issue to the person who had made
the payment, a Refund Voucher against such payment.

Advance payment

Receipt Voucher

Supply

Supplier Tax Invoice

Recipient
Refund Voucher

Particulars of Refund Voucher

Name, address and GSTIN of the supplier;

A consecutive serial number not exceeding sixteen characters, in

one or multiple series, containing alphabets or numerals or special
characters -hyphen or dash and slash and any combination thereof,
unique for a FY;

Date of its issue;

Name, address and GSTIN or UIN, if registered, of the recipient;

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 10.36 GOODS AND SERVICES TAX

Number and date of Receipt Voucher issued

Description of goods/services in respect of which refund is made

Amount of refund made

Rate of tax (central tax, State tax, integrated tax, Union territory tax
or cess)

Amount of tax paid in respect of such goods or services (central

tax, State tax, integrated tax, Union territory tax or cess)

Whether the tax is payable on reverse charge basis; and

Signature/digital signature of supplier/his authorized

representative

(vi) Invoice and Payment Voucher [Section 31(3)(f) & (g) read with second
proviso to rule 46 and rule 52]
The recipient is liable to pay tax on reverse charge basis where he receives
supply of such goods/services/both which are notified for reverse charge
purposes under section 9(3). Such supplies can be received from a
registered or an unregistered supplier.
Further, a builder/promoter is required to pay GST on reverse charge basis
under section 9(4) in one or more of the following cases:
(i) A builder/promoter must purchase 80% of inputs and input services
used in supplying the service from registered persons. In case of
shortfall, he’s required to pay tax under reverse charge on all such
inward supplies (to the extent short of 80% of the inward supplies
from registered supplier).
(ii) Where cement is received from an unregistered person,
promoter/builder has to pay tax on supply of such cement on reverse
charge basis and
(iii) GST on capital goods is payable by the promoter on reverse charge
basis.

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 TAX INVOICE, CREDIT AND DEBIT NOTES 10.37

Invoice to be issued by recipient if he is liable to pay tax under

section 9(3)/(4) and receives supplies from an unregistered person
A registered person who is liable to pay tax under reverse charge [under
section 9(3)/9(4) of the CGST Act] shall issue an Invoice in respect of goods
or services or both received by him from the supplier who is not registered
on the date of receipt of goods or services or both. Thus, a recipient liable
to pay tax by virtue of section 9(3) has to issue invoice only when supplies
have been received from an unregistered supplier.
Payment voucher to be issued by recipient at the
time of making payment if he is liable to pay tax
under section 9(3)/(4)
Besides, a registered person who is liable to pay tax
under reverse charge [under section 9(3)/9(4) of the CGST Act] shall issue a
Payment Voucher at the time of making payment to the supplier.
Particulars of Payment Voucher

Name, address and GSTIN of the supplier if registered;

A consecutive serial number not exceeding 16 characters, in one or
multiple series, containing alphabets or numerals or special
characters -hyphen or dash and any combination thereof, unique
for a FY
Date of its issue;
Name, address and GSTIN of the recipient;
Description of goods or services;
Amount paid;
Rate of tax (central tax, State tax, integrated tax, Union territory
tax or cess);
Amount of tax payable in respect of taxable goods or services
(central tax, State tax, integrated tax, Union territory tax or cess);
Place of supply along with the name of State and its code, in case
of a supply in the course of inter-State trade or commerce; and
Signature/digital signature of supplier/his authorized
representative

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 10.38 GOODS AND SERVICES TAX

(vii) Delivery challan [Rule 55]

Rule 55 specifies the cases where at the time of removal of goods, goods
may be removed on delivery challan and invoice may be issued after
delivery. These are provided in the following table:

Nature of supply Deliver challan to Particulars of Delivery

be issued Challan

(1) Supply of liquid • serially Date and number of the

gas where the numbered not delivery challan
quantity at the exceeding 16 Name, address and GSTIN of
time of removal characters the consigner, if registered
from the place of • in one or
business of the multiple series Name, address and GSTIN or
supplier is not • at the time of UIN of the consignee, if
known, removal of registered
(2) Transportation goods for HSN code and description of
of goods for job transportation goods,
work,
Quantity (provisional, where
(3) Transportation
the exact quantity being
of goods for
supplied is not known)
reasons other
than by way of Taxable value
supply, or Tax rate and tax amount –
(4) Such other central tax, state tax,
supplies as may integrated tax, union
be notified by territory tax or cess, where
the Board the transportation is for
supply to the consignee
Place of supply, in case of
inter-state movement
Signature

A. Delivery challan in Triplicate

The delivery challan shall be prepared in TRIPLICATE, in case of supply of
goods, in the following manner:

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 TAX INVOICE, CREDIT AND DEBIT NOTES 10.39

Original copy

Duplicate copy

Triplicate copy

B. Declaration in E-way Bill

Where goods are being transported on a delivery challan in lieu of invoice,
the same shall be declared in E-Way Bill 14.
C. Tax invoice to be issued after delivery of goods
Where the goods being transported are for the purpose of supply to the
recipient but the tax invoice could not be issued at the time of removal of
goods for the purpose of supply, the supplier shall issue a tax invoice after
delivery of goods.
D. Goods transported in SKD/CKD condition or in batches or lots
Where the goods are being transported in a semi knocked down or
completely knocked down condition or in batches or lots,
(a) the supplier shall issue the complete invoice before dispatch of the
first consignment;
(b) the supplier shall issue a delivery challan for each of the subsequent
consignments, giving reference of the invoice;
(c) Copies of the corresponding delivery challan shall accompany each
consignment along with a duly certified copy of the invoice; and
(d) the original copy of the invoice shall be sent along with the last
consignment.
E. Goods may be moved within the State/from the State of
registration to another State for supply on approval basis and art
works may be sent by artists to galleries for exhibition on delivery
challan along with e-way bill wherever applicable
Suppliers of jewellery etc. who are registered in one State may have to visit

14
The provisions of E-way Bill have been discussed in Chapter-11: Accounts and Records; E-way
Bill in this Module of the Study Material.

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 10.40 GOODS AND SERVICES TAX

other States (other than their State of registration) and need to carry the
goods (such as jewellery) along for approval. In such cases if jewellery etc.
is approved by the buyer, then the supplier issues a tax invoice only at the
time of supply. Since the suppliers are not able to ascertain their actual
supplies beforehand and while ascertainment of tax liability in advance is a
mandatory requirement for registration as a casual taxable person, the
supplier is not able to register as a casual taxable person. Such goods are
also carried within the same State for the purposes of supply.
In view of relevant provisions of rule 55, it is clarified that the goods which
are taken for supply on approval basis can be moved from the place of
business of the registered supplier to another place within the same State
or to a place outside the State on a delivery challan along with the e-way
bill wherever applicable and the invoice may be issued at the time of
delivery of goods. For this purpose, the person carrying the goods for
such supply can carry the invoice book with him so that he can issue the
invoice once the supply is fructified [Circular No. 10/10/2017 GST dated
18.10.2017].
Likewise, in case where artists supply art works in different States - other
than the State in which they are registered as a taxable person and if the
art work is selected by the buyer, then the supplier issues a tax invoice
only at the time of supply, it is clarified that the art work for supply on
approval basis can be moved from the place of business of the registered
person (artist) to another place within the same State or to a place outside
the State on a delivery challan along with the e-way bill wherever
applicable and the invoice may be issued at the time of actual supply of
art work [Circular No. 22/22/2017 GST dated 21.12.2017].
(viii) Supplier permitted to issue any document other than tax invoice
[Proviso to section 31(2) read with rules 54]
Government may, on the recommendations of
the Council, by notification and subject to such
conditions as may be mentioned therein,
specify the categories of services in respect of
which––
(a) any other document issued in relation to the supply shall be deemed
to be a tax invoice; or
(b) tax invoice may not be issued.

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 TAX INVOICE, CREDIT AND DEBIT NOTES 10.41

Following suppliers may issue a tax invoice, but they are also permitted to
issue any other document in lieu of tax invoice, by whatever name called:

Supplier of taxable Document in lieu of the tax invoice

service
Optional Mandatory information
information

Insurer/ Banking • Serial number Other information (other

company/ Financial (It is not than serial no. and
institution, mandatory for address of recipient) as
including NBFC a bank/ prescribed for a Tax
insurance Invoice, under rule 46.
company to
serially number A customer may avail
the invoices/numerous services from
document). the bank / insurer in a
• Address of the given tax period. Such
recipient of entities may issue a
taxable service. consolidated tax invoice/
statement/ advice, any
other document in lieu
thereof, by whatever
name called may be
issued/ made available,
physically/ electronically,
for supply of services
made during a month at
the end of the month.
However, the signature
or digital signature of
the supplier or his
authorised
representative shall not
be required in the case
of issuance of a
consolidated tax invoice
or any other document

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 10.42 GOODS AND SERVICES TAX

in lieu thereof in
accordance with the
provisions of the
Information Technology
Act, 2000.

Goods Transport Gross weight of the

Agency (GTA) consignment
supplying services in
relation to Name of the consignor
transportation of and the consignee
goods by road in a
goods carriage Registration number of
goods carriage in which
the goods are
transported

Details of goods
transported

Details of place of origin

and destination

GSTIN of the person

liable for paying tax
whether as consignor,
consignee or GTA

Other information as
prescribed for a tax
invoice, under rule 46

Supplier of • Serial number Tax invoice shall include

passenger • Address of the ticket in any form, by
transportation recipient of whatever name called.
service taxable service
Other information (other
than serial no. and address
of recipient) as prescribed

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 TAX INVOICE, CREDIT AND DEBIT NOTES 10.43

for a tax invoice, under rule

46.
However, signature or
digital signature of the
supplier or his authorized
representative shall not be
required in the case of
issuance of ticket in
accordance with the
provisions of the
Information Technology
Act, 2000.

Registered person Details of recipient Supplier is required to

supplying services by of service issue an electronic ticket
way of admission to and the said electronic
exhibition of ticket shall be deemed to
cinematograph be a tax invoice.
films in multiplex
screens Other information (other
than details of recipient
of service) as prescribed
for a tax invoice, under rule
46.

It is important to note here that keeping in view the large number of

transactions in banking, insurance and passenger transportation sector,
taxpayers need not mention the address of the customer and the serial
number in their invoices.

(ix) Tax invoice in case of Input Service Distributor (ISD) [Rule 54(1) &
54(1A)]
An ISD invoice or, as the case may be, an ISD credit note issued by an ISD
shall contain the following details:-

Name, address and GSTIN of the ISD

A consecutive serial number not exceeding 16 characters, in one or

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 10.44 GOODS AND SERVICES TAX

multiple series, containing alphabets or numerals or special

characters -hyphen or dash and any combination thereof, unique for
a FY
Date of its issue
Name, address and GSTIN of the recipient to whom the credit is
distributed
Amount of credit distributed
Signature/digital signature of ISD/his authorized representative

However, where the ISD is an office of a banking company or a financial

institution, including NBFC, a tax invoice shall include any document in lieu
thereof, by whatever name called, whether or not serially numbered but
containing the information as mentioned above.
A registered person, having the same PAN and State code as an ISD, may
issue an invoice or, as the case may be, a credit/debit note to transfer the
credit of common input services to the ISD, which shall contain the
following details:-

Name, address and GSTIN of the registered person having the same PAN
and same State code as ISD
A consecutive serial number not exceeding 16 characters, in one or
multiple series, containing alphabets or numerals or special
characters -hyphen or dash and any combination thereof, unique for
a FY
Date of its issue
GSTIN of supplier of common service and original invoice number
whose credit is sought to be transferred to the ISD
Name, address and GSTIN of the ISD
Taxable value**, rate and amount of the credit to be transferred
Signature/digital signature of the registered person/his authorized
representative
** The taxable value in the invoice issued hereunder shall be the same as
the value of the common services.

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 TAX INVOICE, CREDIT AND DEBIT NOTES 10.45

(x) Tax invoice or bill of supply to accompany transport of goods [Rule 55A]
Person-in-charge of the conveyance shall carry a copy of the tax invoice or
the bill of supply issued in accordance with the provisions of rules 46, 46A
or 49 in a case where such person is not required to carry an e-way bill
under these rules.

4. CREDIT AND DEBIT NOTES [SECTION 34]

STATUTORY PROVISIONS

Section 34 Credit and Debit Notes

Sub-section Particulars
(1) Where one or more tax invoices have been issued for supply of any
goods or services or both and the taxable value or tax charged in
that tax invoice is found to exceed the taxable value or tax payable
in respect of such supply, or where the goods supplied are returned
by the recipient, or where goods or services or both supplied are
found to be deficient, the registered person, who has supplied such
goods or services or both, may issue to the recipient one or more
credit notes for supplies made in a financial year containing such
particulars as may be prescribed
(2) Any registered person who issues a credit note in relation to a
supply of goods or services or both shall declare the details of
such credit note in the return for the month during which such
credit note has been issued but not later than September
following the end of the financial year in which such supply was
made, or the date of furnishing of the relevant annual return,
whichever is earlier, and the tax liability shall be adjusted in
such manner as may be prescribed:
Provided that no reduction in output tax liability of the supplier
shall be permitted, if the incidence of tax and interest on such
supply has been passed on to any other person.
(3) Where one or more tax invoices have been issued for supply of any
goods or services or both and the taxable value or tax charged in

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 10.46 GOODS AND SERVICES TAX

that tax invoice is found to be less than the taxable value or tax
payable in respect of such supply, the registered person, who has
supplied such goods or services or both, shall issue to the recipient
one or more debit notes for supplies made in a financial year
containing such particulars as may be prescribed.
(4) Any registered person who issues a debit note in relation to a
supply of goods or services or both shall declare the details of
such debit note in the return for the month during which such
debit note has been issued and the tax liability shall be
adjusted in such manner as may be prescribed.
Explanation.––For the purposes of this Act, the expression “debit
note” shall include a supplementary invoice.

ANALYSIS
(i) Issuance of Credit Note: During the course of trade or commerce, after the
invoice has been issued, there can be situations like:
 The supplier has erroneously declared a value which is more than the
actual value of the goods or services provided.
 The supplier has erroneously declared a higher tax rate than what is
applicable for the kind of the goods or services or both supplied.
 The quantity received by the recipient is less than what has been
declared in the tax invoice.
 The quality of the goods or services or both supplied is not to the
satisfaction of the recipient thereby necessitating a partial or total
reimbursement on the invoice value
 Any other similar reasons.
In order to regularize these kinds of situations, the supplier is allowed to
issue a document called as credit note to the recipient. Once the credit
note has been issued, the tax liability of the supplier will reduce.
The credit note is a convenient and legal method by which the value of the
goods or services in the original tax invoice can be amended or revised.
The issuance of the credit note easily allows the supplier to decrease his tax

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 TAX INVOICE, CREDIT AND DEBIT NOTES 10.47

liability in his returns without requiring him to undertake any tedious

process of refunds.
Section 34(1) provides that where one or more tax invoices have been
issued for supply of any goods or services or both and the taxable value or
tax charged in that/those tax invoice(s) is found to exceed the taxable value
or tax payable in respect of such supply, or where the goods supplied are
returned by the recipient, or where goods or services or both supplied are
found to be deficient, the registered person, who has supplied such goods
or services or both, may issue to the recipient one or more credit notes for
supplies made in a financial year containing the prescribed particulars.
It is important to note that credit note(s) are not
permitted to be issued in case secondary discounts 15 are Secondary
allowed by the supplier since the tax liability of the discounts
supplier does not get reduced in such case. However,
supplier can issue financial/ commercial credit note(s) to reduce the value of
supply payable by the recipient to the supplier [Circular 92/11/2019 GST
dated 07.03.2019].
(ii) Issuance of Debit Note: There can be situations when after the invoice has
been issued:
 The supplier has erroneously declared a value which is less than the
actual value of the goods or services or both provided.
 The supplier has erroneously declared a lower tax rate than what is
applicable for the kind of the goods or services or both supplied.
 The quantity received by the recipient is more than what has been
declared in the tax invoice.
 Any other similar reasons.
In order to regularize these kinds of situations, the supplier is allowed to
issue a document called as debit note to the recipient.

15
Secondary discounts are the discounts which are not known at the time of supply/are offered
after the supply is already over. These discounts are not excluded from the value of supply since
conditions laid down in section 15(3)(b) are not satisfied. Refer Chapter 7 - Value of supply in
Module 1 of the Study Material for detailed discussion on the same.

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 10.48 GOODS AND SERVICES TAX

Section 34(3) provides that where one or

more tax invoices have been issued for Debit note shall include a
supply of any goods or services or both supplementary invoice.
and the taxable value or tax charged in
that tax invoice is found to be less than the taxable value or tax payable in
respect of such supply, the registered person, who has supplied such goods
or services or both, shall issue to the recipient one or more debit notes for
supplies made in a financial year containing the prescribed particulars.
The issuance of a debit note/supplementary invoice creates additional tax
liability. The treatment of a debit note/supplementary invoice is identical to
the treatment of a tax invoice as far as returns and payment are concerned.
The debit note/supplementary invoice is a convenient and legal method by
which the value of the goods and/or services in the original tax invoice can
be enhanced. The issuance of the debit note allows the supplier to pay his
enhanced tax liability in his returns without requiring him to undertake any
other tedious process.
(iii) Details of Debit Note/Credit Note to be declared in return
I. Credit Note:
Any registered person who issues a credit note in
relation to a supply of goods or services or both
shall declare the details of such credit note in the
return for the month during which such credit
note has been issued but not later than:
(i) September following the end of the financial
year in which such supply was made,
or
(ii) the date of furnishing of the relevant annual return,
whichever is earlier.
The tax liability shall be adjusted in such manner as may be
prescribed. However, no reduction in output tax liability of the
supplier shall be permitted, if the incidence of tax and interest on such
supply has been passed on to any other person.

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 TAX INVOICE, CREDIT AND DEBIT NOTES 10.49

Procedure in case of return of time expired medicines/drugs

It is a common trade practice in the pharmaceutical sector that the
drugs or medicines are sold by the manufacturer to the wholesaler
and by the wholesaler to the retailer on the basis of an invoice/bill of
supply as case may be. Such goods have a defined life term which is
normally referred to as the date of expiry. Goods which have crossed
their date of expiry are colloquially referred to as time expired goods
and are returned back to the manufacturer, on account of expiry,
through the supply chain.
In case of return of time expired medicines/drugs, either of the
following two options can be followed:
(A) Return of time expired goods to be treated as fresh supply
In case the person returning the time expired goods is:
 A registered person (other than a composition
taxpayer): he may, at his option, return the said goods by
treating it is as a fresh supply and thereby issuing an
invoice for the same (hereinafter referred to as the, “return
supply”). The value of the said goods as shown in the
invoice on the basis of which the goods were supplied
earlier may be taken as the value of such return supply.
The wholesaler/manufacturer, who is the recipient of such
return supply, shall be eligible to avail ITC of the tax levied
on the said return supply subject to the fulfilment of
conditions specified in section 16 of the CGST Act.
 A composition supplier: he may return the said goods by
issuing a bill of supply and pay tax at the rate applicable to
a composition taxpayer. No ITC will be available to
recipient of return supply.
 An unregistered person: he may return the said goods by
issuing any commercial document without charging any
tax on the same.
Where the time expired goods which have been returned by the
retailer/wholesaler are destroyed by the manufacturer, ITC
treatment in such case has already been discussed in Chapter 8:
Input Tax Credit in this Module of the Study Material.

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 10.50 GOODS AND SERVICES TAX

(B) Return of time expired goods by issuing Credit Note

The manufacturer/wholesaler who has
supplied the goods to the wholesaler/
retailer has the option to issue a credit note Expired
in relation to the time expired goods
returned. Retailer/wholesaler may return
the time expired goods by issuing a delivery challan.
If the credit note is issued within the time limit specified in Point
(iii)(I.) above, the tax liability may be adjusted by the supplier,
subject to the condition that the person returning the time
expired goods has either not availed the ITC or if availed has
reversed the ITC so availed against the goods being returned.
However, if said time limit has lapsed, a credit note may still be
issued by the supplier for such return of goods but the tax
liability cannot be adjusted by him in his hands.
Further, if time expired goods are returned beyond the time
period specified in Point (iii)(I.) and a credit note is issued
consequently, there is no requirement to declare such credit
note on the common portal by the supplier (i.e. by the person
who has issued the credit note) as tax liability cannot be
adjusted in this case.
Where such returned time expired goods are destroyed by the
manufacturer, he/she is required to reverse the ITC attributable
to the manufacture of such goods, in terms of section 17(5)(h) of
the CGST Act.
The clarification may also be applicable to return of goods for
reasons other than being time expired. [Circular No. 72/46/2018
GST dated 26.10.2018].
Example

Date of Date of Treatment in terms of tax liability &

Supply* return** credit

01.07.2020 20.09.2021 Credit note will be issued by supplier

(manufacturer/ wholesaler) and the
same to be uploaded by him on the

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 TAX INVOICE, CREDIT AND DEBIT NOTES 10.51

common portal. Subsequently, tax

liability can be adjusted by such
supplier provided the recipient
(wholesaler / retailer) has either not
availed the ITC or if availed has
reversed the ITC.

01.07.2020 20.10.2021 Credit note will be issued by the

supplier (manufacturer / wholesaler)
but there is no requirement to upload
the same on the common portal.
Subsequently tax liability cannot be
adjusted by such supplier.
* of goods from manufacturer/ wholesaler to wholesaler/ retailer
**of time expired goods from retailer/ wholesaler to wholesaler / manufacturer

II. Debit Note:

Any registered person who issues a debit note in relation to a supply
of goods or services or both shall declare the details of such debit
note in the return for the month during which such debit note has
been issued. The tax liability shall be adjusted in such manner as may
be prescribed.
(iv) Particulars of the Debit and Credit Notes [Rule 53(1A)]
There is no prescribed format, but credit and debit note issued by a supplier
must contain the following particulars, namely:–

Name, address and GSTIN of the supplier.

Nature of the document.

A consecutive serial number not exceeding 16 characters, in one or

multiple series, containing alphabets or numerals or special characters -
hyphen or dash and slash and any combination thereof, unique for a FY.

Date of issue of the document.

Name, address and GSTIN or UIN, if registered, of the recipient.

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 10.52 GOODS AND SERVICES TAX

Name and address of the recipient and the address of delivery, along
with the name of State and its code, if such recipient is un-registered.

Serial number(s) and date(s) of the corresponding tax invoice(s) or, as

the case may be, bill(s) of supply.

Value of taxable supply of goods or services, rate of tax and the amount
of the tax credited or, as the case may be, debited to the recipient

Signature/digital signature of the supplier/his authorized representative.

5. PROHIBITION OF UNAUTHORISED
COLLECTION OF TAX [SECTION 32]
A person who is not a registered person shall not collect in respect of any supply
of goods or services or both any amount by way of tax under this Act. No
registered person shall collect tax except in accordance with the provisions of this
Act or the rules made thereunder.
(8) Rujuta is engaged in providing grooming services. She is not
registered under GST law as her turnover is below the threshold limit.
Rujuta cannot collect tax on the grooming services provided by her as a
person who is not a registered person cannot collect any amount by way of tax
under this Act in respect of any supply of goods or services or both.

6. AMOUNT OF TAX TO BE INDICATED IN TAX

INVOICE AND OTHER DOCUMENTS
[SECTION 33]
Notwithstanding anything contained in this Act or any other law for the time
being in force, where any supply is made for a consideration, every person who
is liable to pay tax for such supply shall prominently indicate in all documents
relating to assessment, tax invoice and other like documents, the amount of tax
which shall form part of the price at which such supply is made.

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 TAX INVOICE, CREDIT AND DEBIT NOTES 10.53

LET US RECAPITULATE
1. Who can raise a tax invoice?

Registered Person

Supplying taxable goods or Receiving taxable goods or services

services from unregistered supplier

2. Time limit for issuance of invoice

Taxable supply

Goods Services

Involving No movement Sale or return Within 30 days**

movement of of goods supplies from the supply of
goods services
Before or at the time of
At the supply, or within 6 **45 days for
At the time
time of months from the Insurance,
of removal delivery removal – whichever is Banking
earlier

In case of
continuous supply •before/at the time each successive statements of accounts is
of goods issued or each successive payment is received

due date of payment is on/before due date of

ascertainable from the contract payment
In case of
continuous not so ascertainable before/at the time of receipt
supply of of payment
services payment is linked to the on/before the date of
completion of an event completion of that event

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 10.54 GOODS AND SERVICES TAX

3. Important contents of tax invoice

Name &
Consecutive GSTIN of
GSTIN of address of
Serial Number recipient, if HSN
supplier recipient, if not
& date of issue registered
registered

Tax rate –
Description of Central tax &
Quantity in Total Value of Taxable Value
goods or State tax or
case of goods supply of supply
services Integrated tax,
cess

Address of
Tax payable on Signature of
Amount of tax delivery where
Place of supply reverse charge authorised
charged different than
basis signatory
place of supply

Note: In case of e-invoice, QR code having embedded IRN in it is also there.

4. Manner of issuing the invoice

Supply of Goods Supply of services

Triplicate Duplicate

Original copy for recipient Original copy for recipient; and

Duplicate copy for transporter; and Duplicate copy for supplier
Triplicate copy for supplier

The serial number of invoices issued during a month / quarter shall be

furnished electronically in FORM GSTR-1.

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 TAX INVOICE, CREDIT AND DEBIT NOTES 10.55

5. E-invoicing
A. Class of persons mandatorily required to issue e-invoice [hereinafter
referred to as notified persons]

All registered businesses

with an aggregate turnover (based Required to issue

on PAN) greater than ` 50 crore E-invoice

in any preceding financial year

from 2017-18 onwards

B. Important terms
E-invoice schema

Uniform standard
format

applicable for all

businesses across the Form GST INV-1
country

containing mandatory
specified fields to be
reported in electronic
format to IRP

Invoice Registration Portal [IRP]

website
for uploading or reporting of invoices
by notified persons

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 10.56 GOODS AND SERVICES TAX

Invoice Reference Number [IRN]

Unique reference number

generated and returned by IRP

on successful registration of e-invoice

GST invoice will be valid only with a valid IRN

C. Advantages of e-invoicing

Auto-reporting of invoices into GST return

Auto-generation of e-way bill
Substantial reduction in transcription errors
Early payment
Cost reduction
Improved efficiency of business
Reduction of tax evasion
Elimination of fake invoices

D. Situations in which e-invoicing is applicable

Supply of goods and/or services to a registered person by •Applicable
notified person [B2B supplies]
Exports by notified persons •Applicable

B2C supplies by notified persons •Not applicable

Invoices issued by Input Service Distributor •Not applicable

Supplies made by notified person, tax on which is payable under •Applicable

reverse charge under section 9(3)
Where specified category of supplies are received by notified
persons from unregistered persons [attracting reverse charge •Not applicable
under section 9(4)] or through import of services

Import of goods (Bills of Entry) •Not applicable

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E. No requirement of issuing invoice copies in triplicate/duplicate

No need of issuing invoice copies

Where e-invoicing is applicable
in triplicate/duplicate

F. Exemption from e-invoicing

Special Economic Zone units

Insurer/banking company/financial institution including NBFC

GTA supplying services in relation to transportation of goods by road in a goods
carriage

Supplier of passenger transportation service

Person supplying services by way of admission to exhibition of cinematograph films
in multiplex screens

G. Overall work flow of e-invoice

Taxpayers (suppliers) create GST Taxpayers upload

IRP
invoices on their own the
generates
Accounting/Billing/ERP systems as per e-invoice schema
IRN
e-invoice schema [Form GST INV-01] to IRP

IRP returns IRP digitally signs

Supplier shares the
e- invoice the e-invoice and
e-invoice with receiver
to supplier add QR code
(along with QR code)

H. Generation of e-way bill/populating relevant parts of GST return through

e-invoicing data

IRP sends e-invoice data along with IRN

E-way bill
GST System
system

Auto-populate Auto-populate Parameters e.g. ‘Transporter ID’ and

data into data into ‘Vehicle Number’, etc. reported in e-
GSTR-1 of GSTR-2A of invoice schema facilitate generation
supplier respective receiver of e-way bill

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 10.58 GOODS AND SERVICES TAX

I. Cancellation of reported invoice

by reporting IRN
Cancellation of
allowed by seller on IRP within
reported invoice
specified time.

J. Amendment of reported invoice

Possible only on GST portal

Amendment of e-invoice
already uploaded on IRP
Not possible through the IRP

6. Revised Tax Invoice

Revised Tax Invoices to be issued in respect of taxable supplies

effected during this period

Effective date of Date of issuance of certificate

registration of registration

Consolidated Revised Tax Invoice (CTRI) may be issued in respect of taxable

supplies made to an unregistered recipient during this period

In case of inter-State supplies, CTRI cannot be issued in respect of all

unregistered recipients if the value of a supply exceeds ` 2,50,000 during this
period.

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7. Consolidated Tax Invoice

Tax invoice is not required

Consolidated Tax
Value of supply < `200 Invoice shall be
issued for such
to be issued

Recipient is unregistered supplies at the close

of each day in
Recipient does not require such respect of all such
invoice supplies

8. Bill of Supply
Registered Person

Supplying exempted goods or

services or both
Tax Invoice Bill of Supply

Paying tax under composition levy

9. Receipt Voucher

Advance payment
Supplier Recipient
Receipt Voucher

Where at the time of receipt of advance, rate of tax/ nature of supply is not
determinable

Where at the time of receipt of

advance

(i) rate of tax is not determinable tax shall be paid at the rate of 18%

(ii) nature of supply is not same shall be treated as inter-

determinable State supply

© The Institute of Chartered Accountants of India

 10.60 GOODS AND SERVICES TAX

10. Refund Voucher

Advance payment
Receipt Voucher
Supplier Supply Recipient
Tax Invoice
Refund Voucher

11. Invoice and Payment Vouchers

Payment Voucher

Where Recipient is Receives the supplies taxable on

registered Reverse Charge basis

under section 9(3) under section 9(4)

Supplier is
Supplier is registered Supplier is unregistered unregistered

Recipient will issue a Payment Voucher at the time of making payment to supplier.

Invoice

Where Recipient is Receives the supplies taxable on

registered Reverse Charge basis

under section 9(3) under section 9(4)

Supplier is Supplier is
Supplier is
unregistered unregistered
registered

Recipient shall issue Invoice

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 TAX INVOICE, CREDIT AND DEBIT NOTES 10.61

12. Credit Notes

Where one or more tax invoices have issued for supply of any goods or services or both

Taxable value in invoice >

where goods or
Taxable value in respect of where the services or both
such supply OR goods supplied OR supplied are
OR are returned by found to be
Tax
Taxcharged
charged in invoice>>
in invoice the recipient deficient
Tax
Taxpayable
payable in
in respect of
respect of
such
such supply
supply

Registered Supplier of may issue one or more

Recipient of goods or
goods or services or credit notes for
supplies made in a FY services or both
both

13. Debit Notes

Where one or more tax invoices have been issued for supply of any goods or services or
both

Taxable value in invoice < Taxable value in respect of such

supply

Tax charged in invoice < Tax payable in respect of such supply

Registered Supplier of may issue one or more

goods or services or debit notes for supplies
made in a FY
both

© The Institute of Chartered Accountants of India

 10.62 GOODS AND SERVICES TAX

TEST YOUR KNOWLEDGE

1. Jai, a registered supplier, runs a general store in Ludhiana, Punjab. Some of
the goods sold by him are exempt whereas some are taxable. You are required
to advise him on the following issues:
(i) Whether Jai is required to issue a tax invoices in all cases, even if he is
selling the goods to the end consumers?
(ii) Jai sells some exempted as well as taxable goods valuing ` 5,000 to a
school student. Is he mandatorily required to issue two separate GST
documents?
(iii) Jai wishes to know whether it’s necessary to show tax amount
separately in the tax invoices issued to the customers. You are required
to advise him.
2. Avtaar Enterprises, Kanpur started trading exclusively in ayurvedic medicines
from July 1. Its turnover exceeded ` 40 lakh on October 3. The firm applied
for registration on October 31 and was issued registration certificate on
November 5.
Examine whether any revised invoice can be issued in the given scenario. If
the answer to the first question is in affirmative, determine the period for
which the revised invoices can be issued as also the last date up to which the
same can be issued.
3 Discuss the provisions relating to issue of an invoice/document in the
following circumstances:
(i) Advance payment is received against a supply, but subsequently no
supplies are made.
(ii) Goods are sent on approval for sale or return and are removed before
the supply takes place.
(iii) Mr. Mohan provides continuous supply of services to his client, where
the due date of payment for such services is not ascertainable. No
advance has been received in this behalf.

© The Institute of Chartered Accountants of India

 TAX INVOICE, CREDIT AND DEBIT NOTES 10.63

ANSWERS
1. (i) No, he is not required to issue tax invoice in all cases. As per
section 31(1), every registered person supplying taxable goods is
required to issue a ‘tax invoice’. Section 31(3)(c) stipulates that every
registered person supplying exempted goods is required to issue a bill
of supply instead of tax invoice.
Further, rule 46A provides that a registered person supplying taxable
as well as exempted goods or services or both to an un-registered
person may issue a single ‘invoice-cum-bill of supply’ for all such
supplies.
However, as per section 31(3)(b) read with rule 46 and 49, a registered
person may not issue a tax invoice/bill of supply if:
(i) value of the goods supplied <` 200,
(ii) the recipient is unregistered; and
(iii) the recipient does not require such invoice.
Instead, such registered person shall issue a Consolidated Tax
Invoice/bill of supply for such supplies at the close of each day in
respect of all such supplies.
(ii) As per rule 46A, where a registered person is supplying taxable as well
as exempted goods or services or both to an unregistered person, a
single “invoice-cum-bill of supply” may be issued for all such
supplies. Thus, there is no need to issue a tax invoice and a bill of
supply separately to the school student in respect of supply of the
taxable and exempted goods respectively.
(iii) As per section 33, where any supply is made for a consideration, every
person who is liable to pay tax for such supply shall prominently
indicate in all documents relating to assessment, tax invoice and other
like documents, the amount of tax which shall form part of the price at
which such supply is made.
As per rule 46(m), a tax invoice shall contain the various particulars,
interalia, namely, amount of tax charged in respect of taxable goods
or services (central tax, State tax, integrated tax, Union territory tax or
cess);

© The Institute of Chartered Accountants of India

 10.64 GOODS AND SERVICES TAX

Hence, Jai has to show the tax amount separately in the tax invoices
issued to customers.
2. As per section 31(3)(a), a registered person may, within one month from the
date of issuance of certificate of registration, issue a revised invoice against
the invoice already issued during the period beginning with the effective
date of registration till the date of issuance of certificate of registration to
him.
Further, rule 10(2) lays down that the registration shall be effective from the
date on which the person becomes liable to registration where the
application for registration has been submitted within a period of 30 days
from such date.
In the given case, Avtaar Enterprises has applied for registration within 30
days of becoming liable for registration. Thus, the effective date of
registration is the date on which Avtaar Enterprises became liable for
registration i.e., October 3. Therefore, since in the given case there is a time
lag between the effective date of registration (October 3) and the date of
grant of certificate of registration (November 5), revised invoices can be
issued. The same can be issued for supplies made during this intervening
period i.e., for the period beginning with October 3 till November 5. Further,
the revised invoices can be issued for the said period till December 5.
3. (i) As per section 31(3)(e), where advance payment is received against a
supply for which receipt voucher has been issued, but subsequently
no supplies are made and no tax invoice is issued in pursuance
thereof, a refund voucher may be issued to the person who had made
the advance payment.
(ii) As per section 31(7), where the goods are sent on approval for sale or
return and are removed before the supply takes place, the invoice
shall be issued before or at the time of supply or 6 months from the
date of removal, whichever is earlier.
(iii) As per section 31(5)(b), in case of continuous supply of services, where
the due date of payment is not ascertainable from the contract, the
invoice shall be issued before or at the time when the supplier of
service receives the payment.
Examples/Illustrations/Questions and Answers, as the case may be, given in the
Chapter are based on the position of GST law existing as on 30.04.2021.

© The Institute of Chartered Accountants of India