Module 4

TAX INVOICE & RETURNS

INVOICE MEANING
Invoice in simple terms is nothing but a document specifying list of goods
sent or services provided and a statement of the sum due against those
items. Invoice is often understood as ‘proof of sale’.

A tax invoice is an invoice sent by the registered dealer to the purchaser

showing the amount of tax payable. It includes the description, quantity,
value of goods and services and the tax charged.

Every registered taxable person under GST supplying Goods or services is

required to issue a tax invoice for all supplies effected. The word “Every
registered Taxable person” clearly specifies that issuing Tax Invoice is
compulsory under GST law.
 Issue of tax invoices (sec 31)
Any supplier of goods or services or both is liable to issue a tax invoice as insisted
in the section 31 of the Act. The following are the provisions of the Act in this
respect –

1) A registered person supplying taxable goods shall, before or at the time, of, —

Removal of goods for supply to the recipient, where the supply involves
movement of goods; or

EXAMPLE: A manufacturer in Delhi supplies goods to a buyer in Mumbai. The

goods are dispatched from Delhi.- Invoice timing: Invoice should be issued before or
at the time of removal of goods from Delhi.
 Delivery of goods or making available thereof to the recipient, in any other case,

EXAMPLE: A seller hands over goods directly to a buyer at the seller's warehouse.- Invoice
timing: Invoice can be issued at the time of delivery or making goods available to the
buyer.

2) A registered person supplying taxable services shall, before or after the provision of
service but within a prescribed period; issue a tax invoice, showing the description, value,
tax charged thereon and such other particulars as may be prescribed:

3. a) Newly registered person may issue a revised invoice against the one already issued
during the period between the effective date of registration and the date of issuance of
certificate of registration. Such revised invoice shall be issued within a period of one
month of issue of certificate of registration.

b) A registered person need not issue a tax invoice if the value of the goods or services
supplied is less than Rs 200
b) A registered person supplying exempted goods or services or paying composition
tax under section 10 shall issue a ‘bill of supply’ instead of a tax invoice,
containing the prescribed details. Bill of supply is not required if the value of
goods or service is less than Rs 200.

c) A registered person shall, on receipt of advance payment with respect to any

supply of goods or services, issue a receipt voucher or any other document
evidencing receipt of such payment.

d) After issuing a receipt voucher for advance payment, if no supply is made a

refund voucher may be issued against such payment.

e) A registered person who is liable to pay reverse charge shall issue an invoice in
respect of goods or services or both received from unregistered persons.

f) A registered person who is liable to pay a reverse charge shall issue a payment
voucher at the time of making payment to the supplier.
4. In case of continuous supply of goods, where successive statements of accounts or
successive payments are involved, the invoice shall be issued before or at the time each
such statement is issued or each such payment is received.

Invoice timing :issue invoice before or at the time each monthly statement is issued or
each payment is received

5. In case of continuous supply of services,-

a) If the due date of payment is ascertainable the invoice shall be issued on or before
the due date of payment eg. Telephone bill

b) Where the due date of payment is not ascertainable from the contract, the invoice
shall be issued before or at the time when the supplier of service receives the
payment eg .Gas bill
c) Where the payment is linked to the completion of an event, the invoice shall be
issued on or before the date of completion of that event. Eg Contracts
6. In a case where the supply of services ceases before the completion
of the supply as an agreement, the invoice shall be issued at the time
when the supply ceases.

7. Where the goods are sent on sale or return basis, the invoice shall be
issued before or at the time of supply or six months from the date of
removal of goods, whichever is earlier.
Rules relating to tax invoice (Rule 46)
Name, address and Goods and Services Tax Identification Number of the supplier;

A consecutive serial number not exceeding sixteen characters, in one or multiple series,
containing alphabets or numerals or special characters- hyphen or dash and slash and any
combination thereof, unique for a financial year;

Date of its issue;

Name, address and Goods and Services Tax Identification Number or Unique Identity
Number, if registered, of the recipient;

Name and address of the recipient and the address of delivery, along with the name of the
State and its code, if such recipient is un-registered and where the value of the taxable
supply is fifty thousand rupees or more;
 If the recipient is unregistered and the value of taxable supply is less than ₹50,000, then
Name and address of the recipient along with the delivery address.- Include the name of
the State and its code.-

Condition: This is required if the recipient requests that these details be recorded in the
tax invoice.

Harmonised System of Nomenclature code for goods or services;

Description of goods or services;

Quantity in case of goods and unit or Unique Quantity Code thereof;

Total value of supply of goods or services or both;

Taxable value of the supply of goods or services or both taking into account discount or
abatement, if any;

Rate of tax (central tax, State tax, integrated tax, Union territory tax or cess);
 Amount of tax charged in respect of taxable goods or services
(central tax, State tax, integrated tax, Union territory tax or cess);

Place of supply along with the name of the State, in the case of a
supply in the course of inter-State trade or commerce;

Address of delivery where the same is different from the place of

supply;

Whether the tax is payable on reverse charge basis; and

Signature or digital signature of the supplier or his authorised

representative:
Receipt voucher

GST receipt voucher is a commercial document and evidence for

advance payment for the supply of goods or services.
 Receipt Voucher for advance payment -Contents
Whenever a person registered under GST receives an advance payment for supply of any goods or
services, a GST refund voucher has to be issued with the following details:

• Name, address and GSTIN of the supplier.

• Consecutive serial number not exceeding sixteen characters, in one or multiple series,
containing alphabets or numerals or special characters-hyphen or dash and slash,
unique for a financial year.

• Date of its issue of receipt voucher.

• Name, address and GSTIN of the person making an advance payment, if registered. If
the person making an advance payment is not registered under GST, then name,
address and state of supply.

• Description of goods or services.

• Amount of advance paid.

• Rate of tax (CGST, SGST, IGST and Cess) applicable on the transaction.

• Amount of tax charged in respect of taxable goods or services shown

under heads such as CGST, SGST, IGST and GST Compensation Cess.

• Place of supply along with the name of the state and its code, in case of
an interstate supply.

• If tax is payable on the reverse charge basis

• Signature or digital signature of the supplier or his authorised

representative.
Tax invoice in the case of input service distributor -contents
An input service distributor invoice or credit note issued by an input service distributor
shall contain the following details.

a)Name ,address and GSTIN of the input service distributor

b) A consecutive serial number not exceeding sixteen characters, in one or multiple

series, containing alphabets or numerals or special characters- hyphen or dash and
slash symbolised as “-” and “/” respectively, and any combination thereof, unique for a
financial year;

c) Date of its issue;

d) Name, address and GSTIN of the recipient to whom credit is distributed.

e) Amount of the credit distributed

f) Signature or digital signature of the input service distributor or representative.

 Credit Note
Credit note in GST is defined under section 34(1) of the CGST act 2017. It is a
document issued by the supplier of goods or services to the recipient where –
A tax invoice has been issued for any supply of goods or services or both and:
– Taxable value or tax charged in the invoice exceeds the taxable value
or tax payable in respect of such supply
– Goods supplied are returned by the recipient
– Goods or services supplied are found to be deficient
In the event any of the above cases, the registered supplier of goods or services
may issue a credit note to the recipient.
Example -

Kapoor Pvt Ltd supplied goods worth Rs. 1,00,000 to M/s Sharma Traders on April
1,2017. A tax invoice of an equivalent amount was issued to M/s Sharma Traders on
the same day. M/s Sharma traders made payment against the invoice. However,
M/s Sharma later realized that certain goods were of poor quality and hence
decided to return the goods. Goods worth Rs. 20,000 were returned to Kapoor Pvt
Ltd on April 20, 2017. Since, goods were returned, Kapoor Pvt Ltd needs to raise a
credit note in favour of M/s Sharma Ltd.
Such a credit note would notify M/s Sharma traders that a credit needs to be made
in their account of an amount equal to the goods returned by them. This document
is a proof that M/s Sharma Traders should reduce the amount it owes to Kapoor Pvt
Ltd Rs. 20,000 under the terms of original invoice.
Debit Note
Debit note is a document issued by a supplier under Section 34(3)of
CGST Act, 2017, when there is a need of increase in taxable value or
increase in GST charged in invoice. The tax liability of the supplier will
increase, as and when the Debit Note is issued by the supplier.

Example Mr X supplied goods to Mr. Y the cost was Rs 100000 but

wrongly billed as Rs 10000. Mr. X will later issue a debit note to Mr Y
for Rs 90000
Under GST, only supplier can issue the debit note.
The person who supplies the goods shall issue a debit note in the
following cases:

• When the value of invoice is less than the actual value of goods
or services.

• When the taxable amount or GST charged is at a lower rate

than what is applicable for such goods or services.
 Furnishing of Returns

Registered persons have to strictly observe the provisions in the GST Act
and rules in connection with the preparation and filing of returns.

In fact the most crucial aspect of GST regime is provision for online
filing of different returns and their real time matching. The different
provisions in this respect are briefed as-
Outward Supplies (Section 2(73)

“Outward Supply” in relation to a person, shall mean supply of goods or

services, whether by sale, transfer, barter, exchange, licence, rental,
lease or disposal or any other means made or agreed to be made by
such person in the course or furtherance of business;”
 Details of outward supplies (Section 37)
1) All registered persons, except:
- Input Service Distributors
- Non-resident taxable persons
- Persons paying tax under Section 10, 51, or 52 shall furnish,
electronically, in such form and manner as may be prescribed,
the details of outward supplies of goodsth or services or both effected
during a tax period on or before the 10 day of the month succeeding
the said tax period
and such details shall be communicated to the recipient of the said
supplies within such time and in such manner as may be prescribed:
❖ Provided that the registered person shall not be allowed to furnish
the details of outward supplies during the period from the eleventh
day to the fifteenth day of the month succeeding the tax period:
*section10-composition levy
*section 51-TDS *section 52-TCS
❖ Provided further that the Commissioner may, for reasons to be recorded in
writing, by notification, extend the time limit for furnishing such details for
such class of taxable persons as may be specified therein:
❖ Provided also that any extension of time limit notified by the Commissioner
of State tax or Commissioner of Union territory tax shall be deemed to be
notified by the Commissioner.
2. Registered persons who receive communicated details under:
- Section 38(3) (inward supplies)
- Section 38(4) (Input Service Distributor's inward supplies)
- Action Required: Accept or reject the communicated details
shall either accept or reject the details so communicated, on or before
the seventeenth day, but not before the fifteenth day, of the month
succeeding the tax period
3. Any registered person, who has furnished the details under
sub-section (1) for any tax period and which have remained unmatched
under section 42 or section 43,
shall, upon discovery of any error or omission therein, rectify such
error or omission in such manner as may be prescribed, and shall
pay the tax and interest, if any, in case there is a short payment of
tax on account of such error or omission, in the return to be
furnished for such tax period:
** section 42- matching ,reversal,reclaim of ITC
**section 43- matching, recersal, reclaim of output tax liability
Form and manner of furnishing details of
outward supplies (Rule 59)
Every registered person, other than a person referred to in section 14
of the Integrated Goods and Services Tax Act, 2017 (13 of
2017),required to furnish the details of outward supplies of goods
or services or both under section 37, shall furnish such details in
FORM GSTR-1 for the month or the quarter, as the case may be,
electronically through the common portal, either directly or through
a Facilitation Centre as may be notified by the Commissioner.
 The details of outward supplies of goods or services or both furnished in FORM GSTR-1 shall
include the -

(a) Invoice wise details of all –

(i) Inter-State and intra-State supplies made to the registered persons; and

(ii) Inter-State supplies with invoice value more than Rs 250000 made to the unregistered
persons;

(b) consolidated details of all –

(i) Intra-State supplies made to unregistered persons for each rate of tax; and

(ii) State wise inter-State supplies with invoice value upto Rs 250000 made to unregistered
persons for each rate of tax;

(c) Debit and credit notes, if any, issued during the month for invoices issued previously.
Inward Supply

“Inward supply” in relation to a person, shall mean receipt of goods or

services or both whether by purchase, acquisition or any other means
with or without consideration;
 Details of inward Supplies (Sec 38)
Every registered person, other than an
-Input Service Distributor or
-a non-resident taxable person or
- a person paying tax under the provisions of section 10 or section 51 or section 52,
shall verify, validate, modify or delete, if required, the details relating to outward supplies
and credit or debit notes communicated under sub-section (1) of section 37
to prepare the details of his inward supplies and credit or debit notes and may include
therein, the details of inward supplies and credit or debit notes received by him in respect of
such supplies that have not been declared by the supplier under sub- section (1) of section
37.
 Every registered person, other than

-an Input Service Distributor or

- a non-resident taxable person or

- a person paying tax under the provisions of section 10 or section 51

or section 52,

- shall furnish, electronically, after the tenth day but on or before the
fifteenth day of the month succeeding the tax period, shall furnish
the following details-
a. The details of inward supplies of taxable goods or services or both,

b. The details of inward supplies of goods or services or both on which

the tax is payable on reverse charge basis under this Act

c. The details of inward supplies of goods or services or both taxable

under the Integrated Goods and Services Tax Act
d. The details of credit or debit notes received in respect of such
supplies during a tax period
 Manner of Furnishing Details of Inward Supplies (Rule 60)
• Every registered person, other than a person referred to in section 14 of the
Integrated Goods and Services Tax Act, 2017,
• required to furnish the details of inward supplies of goods or services or
both received during a tax period under sub-section (2) of section 38 shall,
• on the basis of details contained in Part A, Part B and Part C of FORM
GSTR-2A,
• prepare such details as specified in sub-section (1) of the said section and
furnish the same in FORM GSTR-2 electronically through the common
portal, either directly or from a Facilitation Centre notified by the
Commissioner, after including therein details of such other inward supplies,
if any, required to be furnished under sub-section (2) of section 38.
2. Every registered person shall furnish the details of unmatched
supplies electronically in FORM GSTR-2.

He shall also specify the inward supplies in respect of which he is not

eligible, for input tax credit in FORM GSTR -2.

He shall declare the quantum of ineligible input credit on supplies non-

taxable or for purposes other than business and cannot be determined
at the invoice level, in FORM GSTR -2.
3. The invoice details submitted by:-
Non-resident taxable persons in their GSTR-5 return (Rule 63) are available to
credit recipients in Part A of GSTR-2A. Recipients can include these details in
their GSTR-2.
Input Service Distributors (ISD) in their GSTR-6 return (Rule 65) are available to
credit recipients in Part B of GSTR-2A. Recipients can include these details in
their GSTR-2.
Context- GSTR-2A: Auto-populated statement showing inward supplies for ITC.
- GSTR-2: Recipient's return for reporting inward supplies (now largely
auto-populated concepts apply via GSTR-2B).-
- Common Portal: GSTN facilitates data availability.
5. The details of TDS furnished by the deductor under section 39 (3) in
FORM GSTR -7 shall be made available to the deductee in Part C of
FORM GSTR -2A through the common portal and the deductee may
include the same in his FORM GSTR -2.

6. The details of tax collected at source furnished by an e-commerce

operator under section 52 in FORM GSTR -8 shall be made available to
the concerned person in Part C of FORM GSTR 2A through common
portal and such person may include the same in his FORM GSTR -2.
Annual return (Section 44)

The Annual GST Return is a summary of the monthly/quarterly returns filed

by a taxable person. It is basically a comprehensive return containing all the
transactions that occurred and reported in the periodical returns filed during
the financial year.

Every registered person shall furnish an annual return for every financial year
electronically in such form and manner as may be prescribed on or before
the 31st day of December following the end of such financial year.

Every registered person who is required to get his accounts audited shall
furnish electronically, the annual return along with a copy of the audited
annual accounts.
 Rules relating to Annual Return (Rule 80)
1. Every registered person shall furnish an annual return as specified under
sub-section (1) of section 44 electronically in FORM GSTR-9 through the
common portal either directly or through a Facilitation Centre notified by
the Commissioner.

2.Every person paying tax under section 10shall furnish the annual return
in FORM GSTR9A.

3. Every electronic commerce operator required to collect tax at source

under section 52 shall furnish annual statement referred to in sub-section
(5) of the said section in FORM GSTR -9B.
4. Every registered person whose aggregate turnover during a financial
year exceeds two cr. rupees shall get his accounts audited as specified
under sub-section (5) of section 35 and he shall furnish a copy of
audited annual accounts and a reconciliation statement, duly certified,
in FORM GSTR-9C, electronically through the common portal.
 Types of returns under GST

1.GSTR – 1( Return for Outward Supplies)

GSTR-1 is a monthly return of outward supplies undertaken by a normal
registered taxpayer under GST. In other words, this monthly return
showcases the sales transactions of a business in a particular month.
2.GSTR-2 -It is a monthly return of inward supply of goods and services as
agreed by the recipient of the goods and services. In other words, GSTR-2
contains details with regards to the purchases made by the recipient in a
particular month. The information contained in GSTR-2 is auto-populated
with the details contained in GSTR-2A.
 3 .GSTR-2A - It is a read only document. This document gets
auto-populated once the supplier uploads the details in GSTR-1. In
other words, GSTR-2A enables the recipient to verify the details
uploaded by the supplier in GSTR 1. Also the recipient could accept,
reject, modify or keep the invoices pending using the said details.
However, such changes are made by the recipient in GSTR 2.

4.GSTR – 3B (Summary of Inward and Outward Supplies) GSTR 3B is a

simplified monthly summary return of inward and outward supplies. It
is a self declaration showcasing the summary of GST liabilities of the
taxpayer for the tax period in question. Moreover, it helps the taxpayer
to discharge the tax liabilities in a timely manner.
5. GSTR – 4 (Return For Composition Dealers)

GSTR-4 is a quarterly return that needs to be filed by a registered taxpayer who has signed up for the
Composition Scheme. Under this scheme, small taxpayers having a turnover of upto Rs 1.5 Crs. need to
pay tax at a fixed rate and file quarterly return. This is unlike the normal registered dealer who files
three returns every month including GSTR-1, GSTR-2 and GSTR-3B.

6.GSTR – 5 (Return For Non-Resident Taxable Persons)

GSTR-5 is a monthly return filed by every non-resident taxable person. This return includes details
pertaining to:

• inward supplies

• outward supplies

• any interest, penalty, fees

• tax payable or tax paid or

• any other amount payable under the act

7. GSTR – 6( Return For Input Service Distributors)

GSTR 6 is a monthly return that an Input Service Distributor files every calendar
month. This return provides information of all the invoices on which credit has
been received and are issued by an ISD.

8. GSTR – 7 (Return For Taxpayers Deducting TDS)

GSTR 7 is a monthly return that is required to be filed by the deductors who are
required to deduct TDS under GST. Such a return consists of the details regarding:
• tax deducted at source,
• the liability towards TDS,
• TDS Refund claimed if any
• Interest, late fees etc. paid or payable
9.GSTR – 8 ( Return For E-Commerce Operators Collecting TCS)
GSTR 8 is a monthly return furnished by every electronic commerce operator
who is required to deduct Tax Collected at Source under GST.
10.GSTR – 9 ( Annual Return For Normal Registered Taxpayer Under GST)
Section 44(1) requires that, Every registered person shall furnish
electronically an annual return for every financial year in the prescribed
form.
11.GSTR – 9A( Annual Return For Composition Dealers)
GSTR 9A is the annual return that every registered person opting for
composition levy needs to file every financial year. This return is in addition
to the quarterly returns filed by a composition dealer during a financial year.
12. GSTR – 9B (Annual Return For E-Commerce Operators Collecting
TCS)
Every electronic commerce operator required to collect tax at source
under section 52 shall furnish annual statement in FORM GSTR -9B.
13. GSTR – 9C( Return For Registered Persons Getting Accounts
Audited From Charted Accountants)
Every registered person having an aggregate turnover of more than Rs.
2 cores during a financial year must get his accounts audited by a CA or
cost accountant. Furthermore, he needs to submit the annual return, a
copy of the audited accounts and a reconciliation statement.
14. GSTR – 10 (Return For Registered Person Whose GST Registration
Gets Cancelled)
GSTR-10 is a final return required to be filed by a registered person
whose GST Registration gets cancelled.
15. GSTR – 11( Return For UIN (Unique Identification Number) Holders)
GSTR-11 is a return to be furnished by a person who has been allotted
a Unique
Identification Number (UIN). UIN is issued so that the registered person
obtaining the same can claim refunds for GST paid on goods and
services purchased by them in India
Electronic Way Bill (E-Way bill)

E-Way Bill is an Electronic Way bill for movement of goods to be

generated on the e-Way Bill Portal. A GST registered person cannot
transport goods in a vehicle whose value exceeds Rs. 50,000 (Single
Invoice/bill/delivery challan) without an e-way bill that is generated on
ewaybillgst.gov.in.
Provisions for e- way bill

1.Form GST EWB-1 is an e- way bill form. It has part A, where the details of
the goods are furnished, and part B contains vehicle number.
2.E way bill can be generated even for consignments of value less than Rs
50000, thought it is not compulsory in such cases.
3.When multiple consignment are transported in one vehicle, the transporter
should generate a consolidated e-way bill in the FORM GST EWB -02 and
separately indicate the serial number of e- way bill for each of the
consignment.
4.Upon generation of the e- way bill, on the common portal, a unique e
–way bill number called EBN will be made available to the supplier, the
recipient and the transporter.
 5.When goods are transferred from one vehicle to another vehicle in
the course of transit, the transporter needs to update the details of
conveyance in the e –way bill on the common portal before
transferring the goods to another vehicle

6.If goods are transported for a distance less than 10 kilometres within
the state or union territory from the place of business of the
transporter finally to the place of business of the consignee, updating
the details of conveyance in the e-way bill is not mandatory.

7. The e –way bill can be cancelled electronically on the common portal

within 24 hours of its generation. This would be required if goods are
not transported after generating e- way bill.
8.The recipient of goods should communicate acceptance or rejection of the
consignment covered by the e- way bill , within 72 hours of the details being
made available. If the recipient of goods does not communicate acceptance
or rejection within 72 hours, it will be deemed as accepted by the recipient.

9. If there is any incorrect information or a mistake in the e –way bill, then it

cannot be corrected or edited . In case of any error in the e-way bill ,the only
option is to cancel the e- way bill and generate a new e- way bill with correct
details