GST E-invoicing – Consequences of Non-Compliance
As per the recent mandate, all the registered taxable persons whose aggregate turnover exceeds INR 20 crores in any previous financial years are required to generate an e-invoice under GST for all B2B and export supplies from April 1, 2022. But the question arises, what will be the consequences and penalties of non-compliance with GST e-invoicing provisions. So, in this blog, we will try to cover all the possible consequences and penalties of e-invoicing provision non-compliance.
| Important Note All the notified taxable persons whose aggregate turnover exceeds INR 20 Crores in any previous financial year are required to generate an e-invoice under GST from April 1, 2022. |
Non-generation of an e-invoice
As per the GST e-invoicing system, all the notified taxpayers need to intimate all the B2B and export transactions to the government by uploading the invoice generated on the invoice registration portal (IRP). It shall be noted that the process of the invoice generation will remain the same but it has to be generated on the schema prescribed (GST INV-01) by the government.
Under GST, the non-generation of an e-invoice will infer that the taxpayer does not want to intimate the supply to the government.
Moreover, as per the GST law, any invoice issued by the notified taxpayer without generating the IRN is considered invalid. In simple words, the non-generation of an e-invoice will be treated as a non-issue of invoice and attracts various penalties that will be discussed in the later section. Therefore, the notified taxpayer needs to upload the invoice on the IRP.
Failure to generate e-invoice IRN
As per rule 48(5) of the CGST rules, failure to generate IRN will imply failure of issuance of invoice. Moreover, the non-generation of an e-invoice will be treated as a non-issue of invoice and attracts various penalties that will be discussed in the later section. Therefore, the notified taxpayer needs to upload the invoice on the IRP and obtain IRN along with a signed QR code.
Penalties for non-compliance of GST e-invoicing Provisions
Under GST, non-issuance of e-invoice is an offense and attracts penalties. Here are some of the penal consequences of non-compliance with GST e-invoicing provisions:
| S.No. | Particular | Penalty |
| 1. | Non-issuance of the invoice including Non-generation of invoice Failure to generate IRN | 100% of the tax due or INR10,000 (Whichever is higher) |
| 2. | Incorrect Invoicing | INR 25,000 |
Other consequences of non-compliance of GST e-invoicing Provisions
Apart from the aforementioned penalties, there are certain other consequences of non-compliance with GST e-invoicing Provisions:
- Transporting goods without a valid e-invoice may cause the detention of goods and vehicles by the tax officer.
- Recipients may not acknowledge the goods or make the payment without a valid e-invoice as this would hamper the eligibility of the recipient to avail Input Tax Credit (ITC).
Moreover, the Government is planning to implement a check that would confine the e-way bill generation without a valid e-invoice.
How can we help you avoid penalties?
GSTrobo is one of the leading GSPs providing e-invoicing software that seamlessly integrates with all the major ERPs such as SAP, Microsoft Navision, Oracle, and so forth. You can stay GST compliant and avoid all manual errors by generating interoperable professional-looking e-invoices in a few clicks using our e-invoicing software.
