E-INVOICING FOR WHOSE TURNOVER EXCEEDS RS.20CR IN A FINANCIAL YEAR W.E.F 01.04.2022

E-Invoicing is one of the biggest and positive updates taking place under GST law like the E Way Bill system in 2020. The invoicing practices are adopted by business houses are different from one another and government wants a unified and equal approach to invoicing.

The biggest and foremost important reason behind the introduction of E-invoicing is to curb fake invoicing. Tax leakage and fraud by means of fake invoices is being already a concern of the government before the introduction of GST law.

The government has not introduced E-Invoicing in one shot the step-by-step and phased manner approach has been adopted by the government in making E-Invoicing mandatory.

• In the first phase, E-invoicing is applicable for Taxpayers with an aggregate turnover of more than 500 CR on 1st October 2020.
• In the second phase, E-invoicing is applicable for Taxpayers with an aggregate turnover of more than 100 CR on 1st January 2021.

Soon in Phase Three government will launch and cover the remaining taxpayers.

What is the Definition of E-Invoicing?

Section 2(6) of the CGST Act: “(6) “aggregate turnover” means the aggregate value of all taxable supplies (excluding the value of inward supplies on which tax is payable by a person on reverse charge basis), exempt supplies, exports of goods or services or both and inter-State supplies of persons having the same Permanent Account Number, to be computed on all India basis but excludes central tax, State tax, Union territory tax, integrated tax, and cess;

E-Invoicing for whose turnover exceeds Rs.20 Crores in a financial year with effect from w.e.f 01.04.2022:

CBIC notifies vide Notification No. 1/2022 Central Tax dated 24.02.2022 that e-invoicing has been made mandatory in case of companies/firms/ Proprietors whose turnover exceeds Rs. 20.00 crores in a financial year with effect from 01.04.2022.

Aggregate Turnover in GST:

Turnover, in common parlance, is the total volume of a business. The term ‘aggregate turnover’ has been defined in GST law as under: “aggregate turnover” means the aggregate value of all taxable supplies (excluding the value of inward supplies on which tax is payable by a person on a reverse charge basis), exempt supplies, exports of goods or services or both and inter-State supplies of persons having the same Permanent Account Number, to be computed on all India basis but excludes central tax, State tax, Union territory tax, integrated tax, and cess.

The aggregate turnover computed for the entire financial year between April of a year up to March of next year is called annual aggregate turnover
 

• Taxable sales value
• Exempt sales value
• Export of goods and services
• Interstate supplies by the business to its sister concern under the same PAN or interstate stock transfer or supplies between distinct persons under the same PAN.
• However, the above sum excludes the tax components such as the Central tax, State tax, Union territory tax, Integrated Tax, and Cess.

Process of E-invoice Generation Following is the step-by-step process to issue E-invoice.

Step 1) Creation of Invoice with the help of existing infrastructure but one thing that should keep in mind is that the invoice should contain every mandatory field which is required by E-invoice schema. If all the mandatory fields are not synchronized in the existing infrastructure then the taxpayer is advised to go for IT enable infrastructure.

Step 2) Invoice Authorisation and generation of Unique IRN (Invoice Registration Number). The invoice which has been prepared has to be uploaded to the E-invoicing portal for the generation of IRN. For this taxpayers can use the above-mentioned websites notified by the government.

Step 3) Generation Of QR Code.