CBIC has vide Notification No 14/2022-Central Tax dated 5th July, 2022 has notified CGST ( Amendment) Rules, 2022 vide which CGST Rules, 2017 have been amended. Amongst the various amendments one of the amendment is relating to a new declaration to be given in the GST invoice by persons who are exempt from the provisions of Rule 48(4) viz GST e-invoicing, which is being discussed in this article:
GST e-invoicing:
Rule 48(4) of the CGST Rules, 2017 relating to GST e-invoicing reads as under:
(4) The invoice shall be prepared by such class of registered persons as may be notified by the Government, on the recommendations of the Council, by 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.
Provided that the Commissioner may, on the recommendations of the Council, by notification, exempt a person or a class of registered persons from issuance of invoice under this sub-rule for a specified period, subject to such conditions and restrictions as may be specified in the said notification.
e-Invoicing is mandatory from 1st October 2020 to all businesses whose aggregate turnover has exceeded the Rs.500 crore limit in any of the previous financial years from 2017-18 to 2019-20. From 1st January 2021, e-invoicing became applicable to businesses exceeding the Rs.100 crore turnover limit in any of the financial years between 2017-18 to 2019-20.
It was then extended to businesses with a total turnover of more than Rs.50 crore from 1st April 2021 and the e-invoicing applicability was extended to businesses having more than Rs 20 crore turnover from 1st April 2022.
However it is important to note that , GST e-invoicing shall not be applicable to the following categories of registered persons, irrespective of the turnover, as notified in the CBIC Notification No.13/2020 – Central Tax:
- An insurer or a banking company or a financial institution, including an NBFC
- A Goods Transport Agency (GTA)
- A registered person supplying passenger transportation services
- A registered person supplying services by way of admission to the exhibition of cinematographic films in multiplex services
- An SEZ unit (excluded via CBIC Notification No. 61/2020 – Central Tax)
- A government department and local authority
(excluded via CBIC Notification No. 23/2021 – Central Tax)
The persons as discussed above who are not required to issue GST e-invoices now need to provide a declaration on its invoice.
Declaration to be given on invoice by persons not covered under GST e-invoicing
CBIC has vide Notification No 14/2022-Central Tax dated 5th July, 2022 has inter alia amended Rule 46 of the CGST Rules, 2017 which mandates details to be given on the tax invoice by the supplier. By amendment a new clause (s) has been inserted in said rule which is reproduced as under:
(s) a declaration as below, that invoice is not required to be issued in the manner specified under sub-rule (4) of rule 48, in all cases where an invoice is issued, other than in the manner so specified under the said sub-rule (4) of rule 48, by the taxpayer having aggregate turnover in any preceding financial year from 2017-18 onwards more than the aggregate turnover as notified under the said sub-rule (4) of rule 48.
I/We hereby declare that though our aggregate turnover in any preceding financial year from 2017-18 onwards is more than the aggregate turnover notified under sub-rule (4) of rule 48, we are not required to prepare an invoice in terms of the provisions of the said sub-rule.
Thus the above declaration is not required to be given as of now by persons having aggregate turnover upto Rs 20 crores. However if the turnover exceeds this limit and such tax payer is exempt from issuing tax invoices as stated above like Banks, NBFCs, GTA etc then above declaration is to be given in case GST e-invoicing is not adopted.
The above amendment is effective from 5th July, 2022 and thus tax payers may ensure incorporation of above declaration of their tax invoices issued for taxable outward supplies.
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Frah Saeed is a law graduate specializing in the core field of indirect taxes and is the Co-founder of taxwallah.com. She has authored many publications on GST and is into full-time consultancy on GST to big corporates. She as a part of taxwallah.com heads a team comprising of Chartered Accountants and Advocates and plays a key role in our mission to disseminate GST knowledge to all.
