E-invoice -Applicability

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1. What documents are presently covered under e-invoicing?

i.Invoices
ii. Credit Notes
iii. Debit Notes
when issued by a notified class of taxpayers (to registered persons (B2B) or for the purpose of Exports)are currently covered under e-invoice. Though different documents are covered, for ease of reference and understanding, the system is referred to as ‘e-invoicing’.

2.What supplies are presently covered under e-invoice?

Supplies to registered persons (B2B), Supplies to SEZs (with/without payment), Exports (with/without payment), Deemed Exports, by notified class of taxpayers is currently covered under e-invoicing.

3.B2C (Business to Consumer) supplies can also be reported by notified persons?

No. Reporting B2C invoices by notified persons is not applicable/allowed currently. However, they will be brought under e-invoice in the next phase.

4. Is e-invoicing applicable for NIL-rated or wholly-exempt supplies?

No. In those cases, a bill of supply is issued and not a tax invoice.

5.Whether the financial/commercial credit note s also need to be reported to IRP?

No, only the credit and debit notes issued under Section 34 of CGST/SGST Act have to be reported.

6.Whether e-invoicing is applicable for supplies by notified persons to Government Departments?

e-invoicing by notified persons is mandated for the supply of goods or services or both to a registered person.
Thus, where the Government Department doesn’t have any registration under GST (i.e. not a ‘registered person’), e-invoicing doesn’t arise.
However, where the Govt. department is having a GSTIN (as the entity supplying goods/services/ deducting TDS), the same has to be mentioned as recipient GSTIN in the e-invoice.

7.Whether e-invoicing is applicable for invoices between two different GSTINs under the same PAN?

Yes. e-invoicing by notified persons is mandated for the supply of goods or services or both to a registered person.
As per Section 25(4) of CGST/SGST Act, “A person who has obtained or is required to obtain more than one registration, whether in one State or Union territory or more than one State or Union territory shall, in respect of each such registration, be treated as distinct persons for the purposes of this Act.”

8. For high sea sales and bonded warehouse sales, whether e-invoicing is applicable?

No. These activities/transactions are neither supply of goods nor a supply of services, as per Schedule III of CGST/SGST Act.

9.What is the applicability of e-invoice for import transactions?

E-invoicing is not applicable for import Bills of Entry

10.Which entities/sectors are exempt from the e-invoicing mandate?

a. Special Economic Zone Units
b. insurer or a banking company or a financial institution, including a non-banking financial company.
c. goods transport agency supplying services in relation to transportation of goods by road in a goods carriage.
d. Suppliers of passenger transportation service.
e. Suppliers of services by way of admission to the exhibition of cinematograph films in multiplex screens

11.The exemption from e-invoicing is w.r.t the nature of supply/transaction or w.r.t the entity?

It is for the entity.

12.Do SEZ Developers need to issue e-invoices?

Yes, if they have the specified turnover and fulfilling other conditions of the notification.
In terms of Notification (Central Tax) 61/2020 dt. 30-7-2020, only SEZ Units are exempted from issuing e-invoices.


13. Are Free Trade & Warehousing Zones (FTWZ) exempt from e-invoicing?

Yes. As per Foreign Trade Policy, Free Trade & Warehousing Zones (FTWZ) are only a special category of Special Economic Zones, with a focus on trading and warehousing.

14.Is e-invoicing applicable for supplies by notified persons to SEZs?

Yes, e-invoicing is applicable for supplies by notified persons to SEZs.
In terms of Notification (Central Tax) 61/2020 dt. 30-7-2020, only SEZ Units are exempt from issuing e-invoices.

15.There is an SEZ unit and a regular DTA unit under the same legal entity (i.e. having the same PAN). The aggregate total turnover of the legal entity is more than Rs. 500 Crores (considering both the GSTINs). However, the turnover of the DTA unit is below Rs. 100 crores for FY 19-20.

In this scenario, as the SEZ unit is exempt from e-invoicing, whether e-invoicing will be applicable to DTA Unit?
Yes, because the aggregate turnover of the legal entity, in this case, is > Rs. 500 Crores.
The eligibility is based on aggregate annual turnover on the common PAN.

16.Is e-invoicing applicable to invoices issued by Input Service Distributor (ISD)?

No

17.Whether e-invoicing is applicable for supplies involving Reverse Charge?

If the invoice issued by the notified person is in respect of supplies made by him but attracting the reverse charge under Section 9(3), e-invoicing is applicable.
For example, a taxpayer (say, a Firm of Advocates having aggregate turnover in an FY is more than Rs. 500 Cr.) is supplying services to a company (who will be discharging tax liability as a recipient under RCM), such invoices have to be reported by the notified
person to IRP.
On the other hand, where supplies are received by the notified person from (i) an unregistered person (attracting reverse charge under Section 9(4)) or (ii) through the import of services, e-invoicing doesn’t arise / not applicable.

18. How to know a particular supplier is supposed to issue an e-invoice (i.e. invoice along with IRN/QR Code)?

On fulfillment of prescribed conditions, the obligation to issue an e-invoice in terms of Rule 48(4) (i.e. reporting invoice details to IRP, obtaining IRN, and issuing an invoice with QR Code) lies with the concerned taxpayer.
However, as a facilitation measure, all the taxpayers who had crossed the prescribed turnover in a financial year from 2017-18 onwards have been enabled to report invoices to IRP.
One can search the status of enablement of a GSTIN on the e-invoice portal:
https://einvoice1.gst.gov.in/ > Search > e-invoice status of taxpayer
This listing of GSTINs is solely based on the turnover of GSTR-3B as reported to GST System. It may contain exempt entities or those for whom e-invoicing is not applicable for some other reason. So, it may be noted that enablement status on the e-invoice portal doesn’t mean that the taxpayer is supposed to do e-invoicing. If e-invoicing is not applicable to a taxpayer, they need not be concerned about the enablement status and may ignore it.
Further, the turnover slab of the taxpayer can also be ascertained through “Search Taxpayer”
/ “Know Your Supplier” Sections on GST portal also.
In case any registered person is required to prepare an invoice in terms of Rule 48(4) but not enabled on the portal, he/she may request for enablement on the portal: ‘Registration – > e-Invoice Enablement’.