Businesses having a turnover of ₹500 crore or more can have a sigh of relief as the Finance Ministry has decided not to levy penalty for non-adherence of provision related to the e-invoicing scheme. This scheme came into effect on Thursday and is applicable for businesses having a turnover of ₹500 crore.

Indirect extension

Although the Ministry is not extending the date for implementation, experts feel the waiver of penalty for non-compliance with B2B (Business-to-Business) e-invoicing procedure for one month is an indirect extension.

Also read New e-invoicing system

The Ministry, in a clarification issued late on Wednesday, said: “As a last chance, in the initial phase of implementation of e-invoice, it has been decided that the invoices issued by such taxpayers during October without following the manner prescribed under rule 48(4), shall be deemed to be valid.” It mentioned that the penalty leviable for non-adherence to provisions will stand waived if the Invoice Reference Number (IRN) for such invoices is obtained from the Invoice Reference Portal (IRP) within 30 days of date of invoice.

The government had, in December 2019, prescribed that GST taxpayers having an aggregate annual turnover more than ₹100 crore in any preceding Financial Year, will be required to issue e-invoice for all Business to Business (B2B) supplies, in the manner prescribed under rule 48(4) of the CGST Rules 2017 with effect from April 1. Further, it was also mandated that a B2B invoice or an export invoice issued by such a taxpayer, in any other manner, will not be treated as an invoice. In March this year, the date of implementation of e-invoice was extended to October 1. Keeping in view the hardships faced by taxpayers due to Covid-19 lockdown in July 2020, it was further prescribed that the taxpayers having aggregate turnover of ₹500 crore and above only would be required to issue e-invoice from the said date.

Also read Government in no mood to defer e-invoicing

Now the Ministry has acknowledged that some taxpayers are still not ready. Keeping this in mind, the waiver of penalty for the first month has been planned. This waiver can be explained in this manner. Suppose a a registered person has issued an invoice dated October 3 without obtaining IRN but reports the details of such invoice to IRP and obtains the IRN of the invoice on or before November 2, then it shall be deemed that rules have been complied and the penalty for non-compliance under the law will stand waived.

The Ministry also emphasised that no such relaxation would be available for the invoices issued from November 1.

Earlier, the Central Board of Indirect Taxes and Custom (CBIC) gave relief by deciding implementation of requirement of Dynamic QR Code on B2C (Business to Customer) invoices deferred to December 30. Earlier, the implementation date was October 1.

Related Topics
comment COMMENT NOW