By Lucy Rana and Rupin Chopra
The Ministry of Finance (Department of Revenue) has released a notification dated March 08, 2021 mandating GST Electronic Invoicing System for taxable Suppliers with turnover more than INR 50 Crores[1]. The present notification has been issued further amending the Ministry’s notification March 21, 2020 which made GST E-invoicing mandatory for suppliers with turnover more than INR 100 Crores[2].
Thus, the GST E-invoicing has been made mandatory by the Government for suppliers having aggregate turnover exceeding from earlier stipulated amount of INR 100 Crores to INR 50 crores. The same shall be effective from April 1, 2021.
As per the amendment, the notified class of registered persons have to prepare invoice by uploading specified particulars of invoice (in FORM GST INV-01) on Invoice Registration Portal (IRP) and obtain an Invoice Reference Number (IRN).
Any registered person other than those referred in following rules whose:
| Erstwhile Notification -13th March 2020 | New Notification-21st March, 2021 |
| Aggregate Turnover exceeds
INR 100 Crores |
Aggregate Turnover exceeds
INR 50 Crore |
The eligible tax suppliers can practice E-invoicing only after an Invoice Reference Number (IRN) has been procured by them. The same can be obtained by filling out all relevant information and details as required in FORM GST-INV-01, available on Common Goods and Services Tax Portal at www.gst.gov.in.
EXCEPTIONS FOR TAXABLE SUPPLIERS
The abovementioned notifications shall be applicable to all taxable suppliers except from:
| Rule 54(2) | Insurer or banking company or financial institution (including non-banking financial company) |
| Rule 54(3) | Goods Transport Agency supplying services through transportation of goods by road in a goods carriage |
| Rule 54(4) | Passenger Transport Service |
| Rule 54(4A) | Services permitting admission or exhibition of cinematograph films in multiplex screens |
Conclusion
Allegedly many businesses have been engaging in tax evasions, tax leakages and other tax related frauds since decades. Owing to ever-increasing frauds, the practice of E-invoicing is being promoted by Ministries across the world. One-time reporting of invoices provides real-time access to both, the Authorities as well as the buyers may combat the malafide practices of tax evasion in India.
To enhance the purview, the Government of India vide this notification has reduced the requisite turnover from INR 100 crores to INR 50 crores. This legislative change shall enable additional thousands of firms and suppliers to practice E-invoicing, thereby eventually benefitting both, the business and the customers.
[1] https://www.cbic.gov.in/resources//htdocs-cbec/gst/notfctn-05-central-tax-english-2021.pdf