Chapter 6: Tax Invoicing

The Tax Invoice is the most critical document under GST — it serves as evidence of supply, determines tax liability, and enables recipients to claim Input Tax Credit (ITC).

Statutory Reference: Section 31 of the CGST Act, 2017 read with Rules 46 to 55 of the CGST Rules, 2017.

When to Issue a Tax Invoice

Mandatory Contents of a Tax Invoice

As per Rule 46, every tax invoice must contain:

Name, address, and GSTIN of the supplier

Consecutive serial number (unique for a financial year)

Date of issue

Name, address, and GSTIN (if registered) of the recipient

Description, quantity, and value of goods/services

HSN code / SAC as notified

Rate and amount of CGST, SGST, IGST, or UTGST

Place of supply and State name (in case of inter-State supply)

Signature or digital signature of supplier

Additional Notes:

Separate invoice required for taxable and exempt supplies.

For B2C supplies < ₹200, consolidated invoices may be issued daily.

Tax invoice can be issued in physical or electronic form.

E-Invoicing under GST is a system of digital authentication of B2B invoices through the Invoice Registration Portal (IRP) managed by the GSTN. It ensures real-time reporting and seamless flow of data into GSTR-1 and e-way bill systems.

Legal Reference: Rule 48(4) of CGST Rules and Notification No. 13/2020 – CT dated 21.03.2020 (and subsequent amendments).

Applicability (Turnover-Based Thresholds)

Process of E-Invoicing

1️⃣ Supplier prepares invoice in accounting software (as per prescribed schema). 2️⃣ JSON file uploaded to the Invoice Registration Portal (IRP). 3️⃣ IRP validates details and generates a unique Invoice Reference Number (IRN). 4️⃣ QR Code and digitally signed invoice returned to the supplier. 5️⃣ Details auto-populate in GSTR-1 and e-way bill portal.

Benefits of E-Invoicing

Eliminates fake invoice frauds.

Ensures real-time tax reporting.

Reduces manual errors in return filing.

Simplifies reconciliation between supplier and recipient.

Under Section 34 of the CGST Act, Debit and Credit Notes are issued to adjust tax liability in case of post-supply changes.

(a) Credit Note

Issued by supplier when:

Taxable value or tax charged is higher than actual.

Goods are returned or services cancelled.

Post-supply discount is granted.

Key Points:

Must contain reference to original invoice.

Can be issued any time before 30th November following the end of financial year or before filing annual return, whichever earlier.

Tax liability reduced accordingly.

(b) Debit Note

Issued by supplier when:

Taxable value or tax charged is less than actual.

Price escalation after supply.

Key Points:

Same timeline for reporting as credit note.

Debit note increases output tax liability.

Rule 53 – Contents: Debit/Credit Note must contain:

Name, address, GSTIN of supplier and recipient

Nature of document

Serial number, date, and reference to original invoice

Taxable value, rate, and amount of tax

Signature or digital signature of supplier

(a) Receipt Voucher

When advance payment is received for supply of goods or services, the supplier must issue a Receipt Voucher as per Rule 50.

Contents Include:

Name, address, GSTIN of supplier and recipient

Serial number and date

Description of goods/services

Amount of advance and applicable tax rate

Place of supply (if inter-State)

Signature or digital signature

If the supply does not materialize, a Refund Voucher must be issued to return the advance amount.

(b) Bill of Supply

When a registered person supplies goods or services exempt from GST or opts for the Composition Scheme, they must issue a Bill of Supply instead of a tax invoice.

Rule 49 – Mandatory Details:

Name, address, GSTIN of supplier

Consecutive serial number and date

Description of goods/services

Value of supply

Signature/digital signature

Mention: “Composition taxable person, not eligible to collect tax on supplies” (if applicable)

Example: A composition dealer selling goods worth ₹50,000 will issue a Bill of Supply without charging GST.

Type of Supply	Time of Issue
Goods (with movement)	Before or at the time of removal of goods
Goods (without movement)	Before or at the time of delivery or making available to recipient
Services	Before or after provision of service, but within 30 days (45 days for banks/NBFCs)

Effective Date	Applicable to Taxpayers Having Turnover Above
1 Oct 2020	₹ 500 crore
1 Jan 2021	₹ 100 crore
1 Apr 2021	₹ 50 crore
1 Apr 2022	₹ 20 crore
1 Oct 2022	₹ 10 crore
1 Aug 2023	₹ 5 crore
1 Aug 2025 (proposed expansion)	₹ 1 crore (expected next phase)

Document Type	Purpose	Relevant Rule/Section
Tax Invoice	Evidence of supply; enables ITC	Sec. 31, Rule 46
E-Invoice	Digital authentication for B2B invoices	Rule 48(4)
Credit Note	Reduce tax liability	Sec. 34(1), Rule 53
Debit Note	Increase tax liability	Sec. 34(3), Rule 53
Receipt Voucher	Record of advance received	Rule 50
Refund Voucher	Refund of advance when supply not made	Rule 51
Bill of Supply	For exempt/composition supplies	Rule 49