The concept of E-Invoicing was introduced by our Ministry of Finance in 2019, whereby the registered person is required to issue an e-invoice in case of a supply of services or goods or both to a registered person if the turnover in the financial year exceeds Rs. 100 crores.
On 8th March 2021, CBIC has issued another Notification No. 05/2021 – Central Tax, whereby the provisions of e-invoicing (reporting of business-to-business invoices to GST system) will be effective from 1st April 2021 and the limit of Turnover in the financial year has been substituted to Rs. 50 crores from earlier stated Rs. 100 crores.
The key feature of E-Invoicing is to make the invoice machine-readable and to have a uniform interpretation.
Standardized adoption of e-invoicing by the seller with his buyer or bank or any other party covering the whole business ecosystem can be read by machines and to anticipate and prevent data entry errors.
Businesses do not require to change their billing system or software; they can use the same software with the same user interface to generate e-invoicing. The developing companies will amend their software accordingly to make them conform to the approved standards.
CBIC – Central Board of Indirect Taxes and Customs has issued Notification No. 70/2019 – Central Tax dated 13th December 2019, where the Government of India on the recommendation of the GST council notifies the class of registered person who shall prepare the invoice (e-invoicing) in terms of Rule 48(4) of the said rules if the aggregate turnover of the registered person exceeds Rs. 100 crores in a financial year in respect of the supply of goods or services or both to a registered person.
As per Notification No. 70/2019 – Central Tax, the e-invoicing provisions shall come into force from the 1st day of April 2020.
Later on, in the financial year 2020-21, CBIC again issued another Notification No. 13/2020 – Central Tax on 21st March 2020 in relation to the E-Invoicing.
The said notification supersedes the earlier issued Notification no. 70/2019 – Central Tax dated 13th December 2019, whereby it was notified that the registered person, other than those mentioned in Rule 54(2) – Insurer, banking company or any financial institution, Rule 54(3) – Goods transport agency, Rule 54(4) – Passenger transportation service, Rule 54(4A) – Exhibition of cinematographic films of the said rules shall comply the e-invoicing provisions as per Rule 48(4) in respect of the supply of goods or services or both if the aggregate turnover of the registered taxpayer exceeds Rs. 100 crores in a financial year.
The said notification shall come into effect from 1st October 2020.
Rule 48(4): As per the said rule the invoice shall be prepared by such class of registered persons as may be notified by the Government on the recommendations of the Council including such particulars contained in FORM GST INV-01 after obtaining an Invoice Reference Number by uploading information contained therein on the Common Goods and Services Tax Electronic Portal in such manner and subject to such conditions and restrictions as may be specified in the notification.