CHAPTER 22

 

Tax Invoice, Credit and Debit Notes

 

Goods

 

Tax invoice of goods – General Rule

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
  • Delivery of goods or making available thereof to the recipient, in any other case issue a tax invoice with the prescribed details according to Rule 7(1)

 

Tax invoice in case of continuous supply of goods

Continuous supply of goods means:

  • A supply of goods which is provided or agreed to be provided
  • Continuously or on a recurring basis
  • Under a contract
  • Whether or not by means of a wire, cable, pipeline or other conduit
  • And for which the supplier invoices the recipient on a regular or periodic basis
  • And includes supply of such goods as the Government may notify.

In case of such 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.

 

Tax invoice when goods sent on approval basis

Where the goods, being sent or taken on approval for sale or return, are removed before the supply takes place, the invoice shall be issued before or at the time of supply or 6 months from the date of removal, whichever is earlier. Bill of supply to be issued at the time of removal of goods.

 

Invoice for transportation of goods in knocked down condition in more than one consignment

Where the goods are being transported in semi knocked down or completely knocked down condition:

  • The supplier shall issue the complete invoice before dispatch of the first consignment
  • The supplier shall issue a delivery challan for each of the subsequent consignments giving reference of the invoice
  • Each consignment shall be accompanied by copies of the corresponding delivery challan along with a duly certified copy of the invoice
  • The original invoice shall be sent along with the last consignment.

 

Delivery challan instead of tax invoice

In the following circumstances, the supplier may issue a delivery challan instead of a tax invoice at the time of removal of goods for transportation:

  1. Supply of liquid gas where the quantity at the time of removal from the place of business is not known.
  2. Transportation of goods for job work.
  3. Transportation of goods for reasons other than by way of supply.
  4. Such other notified supplies.

The delivery challan should contain the following details:

  1. Date and serial number
  2. Name, address and GSTIN of the consignor, if registered
  3. Name, address, GSTIN or UIN of consignee, if registered
  4. HSN code and description of goods
  5. Quantity (provisional where the exact quantity being supplied is not known)
  6. Taxable value
  7. Tax rate and tax amount – CGST, SGST and UTGST, IGST
  8. Place of supply in case of inter-State movement
  9. Signature

Delivery challan to be in triplicate marked as:

  1. Original for consignee
  2. Duplicate for transporter
  3. Triplicate for consignor

 

If tax invoice could not be issued at the time of removal the supplier shall issue a tax invoice after delivery of goods and at least a delivery challan should be issued.

 

Services

A registered taxable 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, the tax charged thereon and such other particulars as may be prescribed.

 

Tax invoice in case of continuous supply of services

Continuous supply of services means:

  • Service which is provided or agreed to be provided
  • Continuously or on recurring basis
  • Under a contract
  • For a period exceeding three months
  • With periodic payment obligations
  • And includes supply of such services as the Government may notify

The supplier shall issue tax invoice as follows:

  1. Before due date of payment – where the due date of payment is ascertainable from the contract, the invoice shall be issued on or before the due date of payment.
  2. When date of payment is not ascertainable from the contract, invoice to be issued before or at the time when supplier receives payment.
  3. When payment is linked with completion of milestones or events – invoice to be issued on or before the date of completion of the milestone.
  4. In case 1 and 2, where advance is received, receipt voucher is required to be issued and not tax invoice.

 

Time Limit for issuing tax invoice for services

  1. In case of taxable supply of services, invoice shall be issued within a period of 30 days from the date of supply
  2. Where the supplier is one of the following, invoice can be issued within 45 days from the date of supply, whether or not serially numbered, whether or not containing the address of the recipient, but containing other prescribed information according to Rule 7(1):
  • Insurer
  • Banking company
  • Financial institution
  • NBFC

Banks, FI, NBFC or telecom company can invoice on a quarterly basis to their branches in other States.

 

Tax invoice of Goods Transport Agency (GTA)

The invoice shall contain the following details:

  1. Gross weight of the consignment
  2. Name of the consignor
  3. Name of the consignee
  4. Registration number of goods carriage
  5. Details of goods transported
  6. Place of origin and destination
  7. GSTIN of the person liable for paying tax whether as consignor, consignee or GTA
  8. Such other information also as prescribed in Rule 7(1) pertaining to a regular tax invoice.

 

 

Ticket issued in case of passenger transportation service is a tax invoice irrespective of whatever name it is called, whether or not it is serially numbered or contains the address of the recipient. It should however, contain the other details prescribed under rule 7(1) of the Invoice Rules.

 

Tax invoice by Input Service Distributor (ISD)

Shall contain the following:

  1. Name, address and GSTIN of the ISD
  2. Consecutive serial number unique for a financial year
  3. Date of issue
  4. Name, address and GSTIN of recipient
  5. Amount of credit distributed
  6. Signature or digital signature of ISD or his authorised representative

Banks, FI, NBFC need not serial number the tax invoice, but should contain all other details prescribed above.

 

Revised invoice

A registered person who has been granted registration with effect from a date earlier than the date of issuance of certificate of registration to him, may issue revised tax invoices in respect of taxable supplies affected during the period starting from the effective date of registration till the date of issuance of Certificate of Registration.

General provisions of tax invoice

According to Invoice Rules 7(1), a tax invoice should contain the following:

  1. Name, address and GSTIN of the supplier
  2. Consecutive serial number unique to financial year
  3. Date of issue
  4. Name, address and GSTIN of recipient

 

  • Name, address of the recipient and address of delivery, along with the name of State and its code, if such recipient is unregistered and where the value of taxable supply is ₹50,000 or more:
  1. HSN code of goods or Accounting Code of Services
  2. Description of goods or services
  3. Quantity and unit in case of goods or unique quantity code thereof
  4. Total value of supply of goods or services
  5. Taxable value of supply of goods or services taking into account discount, etc.
  6. Rate of tax (each tax separately)
  7. Amount of tax (each tax separately)
  8. Place of supply and name of State where IGST is applicable
  9. Address of delivery if different from place of supply
  10. Whether tax is payable on reverse charge basis
  11. Signature or digital signature of supplier/authorised representative

 

Export Invoices

Shall contain:

  1. An endorsement Supply meant for Export on payment of IGST or Supply meant for export under bond or letter of undertaking without payment of IGST
  2. Name and address of the recipient
  3. Address of delivery
  4. Name of the country of destination
  5. Number and date of application for removal of goods for export

 

Bill of supply

A registered taxable person supplying exempted goods or services or paying tax under the composition scheme shall issue a bill of supply instead of a tax invoice containing the following:

  1. Name, address and GSTIN of the supplier
  2. Consecutive serial number unique to financial year
  3. Date of issue
  4. Name, address and GSTIN of recipient
  5. HSN code of goods or Accounting Code of services
  6. Description of goods or services
  7. Value of supply of goods or services taking into account discount, etc.
  8. Signature or digital signature of supplier/authorised rep.

 

Receipt voucher in case of receipt of advance

Shall contain:

  1. Name, address and GSTIN of the supplier
  2. Consecutive serial number unique to financial year
  3. Date of issue
  4. Name, address and GSTIN of recipient
  5. Description of goods or services
  6. Amount of advance taken
  7. Rate of tax (each tax separately)
  8. Amount of tax (each tax separately)
  9. Place of supply and name of State where IGST applicable
  10. Whether tax is payable on reverse charge basis
  11. Signature or digital signature of supplier/authorised rep.

 

Invoice under reverse charge basis

A registered person who is liable to pay tax under reverse charge basis, when supplier is not registered, shall issue an invoice on the date of receipt of goods or services and issue a payment voucher when payment is made.

 

Credit notes

  1. Credit notes cannot be issued for renegotiation of prices or for bad debts
  2. Credit notes issued have to be reported in monthly return or latest by September following the year-end of issue of credit notes or the annual return; whichever is earlier.

 

Debit notes

  1. Issue of debit notes to be reported in the monthly returns.

 

Revised invoice, credit notes and debit notes shall contain the following particulars:

  1. Revised Invoice where applicable indicated prominently
  2. Name, address and GSTIN of the supplier
  3. Nature of the document
  4. Consecutive serial number unique to financial year
  5. Date of issue
  6. Name, address and GSTIN of recipient
  7. Name, address of recipient and address of delivery with name of State and code if recipient is unregistered
  8. Serial number and date of corresponding tax invoice or bill of supply
  9. Taxable value
  10. Rate of tax (each tax separately)
  11. Amount of tax (each tax separately)
  12. Signature or digital signature of supplier/authorised rep.

 

Invoice in triplicate for goods

  1. Original for recipient
  2. Duplicate for transporter
  3. Triplicate for supplier

 

Invoice in duplicate for services

  1. Original for recipient
  2. Duplicate for supplier