Indirect Tax

e-invoicing for turnover exceeding 100 Cr Notification 88/2020

In pursuance of the Notification No. 88/2020 – Central Tax dated 10th November, 2020, the Central Government has made further amendment to the Notification No. 13/2020 dated 21st March, 2020 whereby with effect from 1st day of January, 2021, for the words five hundred crore rupees the word one hundred crore rupees shall be substituted.

In the Notification  No. 13/2020 – Central Tax dated 21st March, 2020 it was notified that registered person, other than those referred in sub-rules (2), (3), (4) and (4A) of rule 54 of the said rules, whose aggregate turnover in a financial year exceeds one hundred crore rupees, as a class of registered person who shall prepare invoice and other prescribed documents, in terms of sub-rule(4) of rule 48 of the said rules in respect of supply of goods or services or both to a registered person.

As per Rule 54 of the Central Goods and Service Tax (CGST) Rules, 2017 sub-rules (2), (3), (4) and (4A) covers: –

(2) Where the supplier of taxable service is an insurer or a banking company or a financial institution, including a non-banking financial company,

(3) Where the supplier of taxable service is a goods transport agency supplying services in relation to transportation of goods by road in a goods carriage

(4) Where the supplier of taxable service is supplying passenger transportation service

(4A) A registered person supplying services by way of admission to exhibition of cinematograph films in multiplex screens

(5) The provisions of sub-rule (2) or sub-rule (4) shall apply, mutatis mutandis, to the documents issued under rule 49 or rule 50 or rule 51 or rule 52 or rule 53.

As per Rule 48 on Manner of issuing invoices: –

(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.

(5) Every invoice issued by a person to whom sub-rule (4) applies in any manner other than the manner specified in the said sub-rule shall not be treated as an invoice.

(6) The provisions of sub-rules (1) and (2) shall not apply to an invoice prepared in the manner specified in sub-rule (4).]

Standard Operating Procedure (SOP) to be followed by the exporters

  1. Through the Circular No.131/1/2020-GST dated 23rd January, 2020 Central Board of Indirect Taxes and Customs has communicated that several cases of monetisation of credit fraudulently obtained or ineligible credit through refund of Integrated Goods & Service Tax (IGST) on exports of goods have been detected in past few months. On verification, several such exporters were found to be non-existent in a number of cases.
  2. In all these cases it has been found that the Input Tax Credit (ITC) was taken by the exporters on the basis of fake invoices and IGST on exports was paid using such ITC.
  3. To mitigate the risk, the Board has taken measures to apply stringent risk parameters-based checks driven by rigorous data analytics and Artificial Intelligence tools based on which certain exporters are taken up for further verification. The refund scrolls in such cases are kept in abeyance till the verification report in respect of such cases is received from the field formations. Further, the export consignments/shipments of concerned exporters are subjected to 100 % examination at the customs port.
  4. Exporters whose scrolls have been kept in abeyance for verification would be informed at the earliest possible either by the jurisdictional CGST or by Customs.
  5. To expedite the verification, the exporters on being informed in this regard or on their own volition should fill in information in the format attached as Annexure ‘A’ to the Circular and submit the same to their jurisdictional CGST authorities for verification by them.
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