Research and Analysis on Generation of IRN and QR Code after the date of Invoice
Ever since the concept of E-invoicing was approved by the GST council, the buzz around Einvoicing has gained importance among the business community. In the 37th meeting, GST council approved a standard E-invoice which was held on 20/09/2019 and accordingly a notification was issued bearing ‘No. 68/2019-CT to 72/2019-CT on 13.12.2019’ which lays the legal road map for E-invoice. The E-invoices under GST are the introduction of Digital invoice for Goods & Services provided by the business firms which will be generated at the Government GST Portal.
Hence to understand it one needs to refer to different provisions of CGST Act, 2017 which is stated below in this study.

Query:
The subject matter under consideration is whether IRN number and QR code be generated after the Date of Invoice?

Analysis and Facts:

In order to further analyze the query, it is imperative to quote the relevant provisions of law under CGST Act, 2017 at this juncture-

Definition of E-Invoicing:-
As per Rule 48(4) of CGST Rules, notified class of registered persons have to prepare invoice by uploading specified particulars of invoice (in FORM GST INV-01) on Invoice Registration Portal (IRP) and obtain an Invoice Reference Number (IRN).

After following above ‘e-invoicing’ process, the invoice copy containing inter alia, the IRN (with QR Code) issued by the notified supplier to buyer is commonly referred to as ‘e-invoice’ in GST. Because of the standard e-invoice schema (INV-01), ‘e-invoicing’ facilitates exchange of the invoice document (structured invoice data) between a supplier and a buyer in an integrated electronic format. ‘E-invoice’ in ‘e-invoicing’ doesn’t mean generation of invoice by a Government portal.

There is not much difference between the present system and E-invoicing. Registered persons will continue to create their GST invoices on their own Accounting/Billing/ERP Systems. These invoices will now be reported to ‘Invoice Registration Portal (IRP)’. On reporting, IRP returns the e-invoice with a unique ‘Invoice Reference Number (IRN)’ after digitally signing the e-invoice and adding a QR Code. Then, the invoice can be issued to the receiver (along with QR Code).

A GST invoice will be valid only with a valid IRN.

Notification No. (Central Tax) 68/2019 dated 13-12-2019

• Central Goods and Services Tax (Eighth Amendment) Rules • Inserted below new sub-rules in Rule 48 of CGST Rules, 2017: (4) The invoice shall be prepared by such class of registered person 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.

Validity of Invoice/CDN/DBN (required to be reported to IRP by notified person) without IRN:-
As per Rule 48(4), notified person has to prepare invoice by uploading specified particulars in FORM GST INV-01 on Invoice Registration Portal and after obtaining Invoice Reference Number (IRN). As per Rule 48(5), any invoice issued by a notified person in any manner other than the manner specified in Rule 48(4), the same shall not be treated as an invoice.

So, the document issued by notified person becomes legally valid only with an IRN.

However, in the initial period of operation, Government has given a relaxation that invoices raised by notified taxpayers during October, 2020 without following e-invoice procedure (i.e. uploading invoice details on e-invoice portal (IRP), obtaining IRN and issuing invoice with QR Code) will be deemed to be valid and no penalty will be there if the IRN for such invoices is obtained within 30 days of date of invoice.

It was also specified that no such relaxation would be available for the invoices issued from1st November 2020.

Printing QR Code on the invoice:-

The QR code (containing, inter alia, the IRN) which comes as part of signed JSON from IRP, shall be extracted and printed on the invoice. This is one of the mandatory particulars of invoice under Rule 46 of CGST Rules.
However, printing of QR code on separate paper is not allowed.

Penal provisions for not issuing invoice in accordance with GST Law/Rules:-
The penal provisions are provided in Section 122 of CGST/SGST Act read with CGST Rules.

Conclusion:

We have been informed that the vendors have raised invoice on particular date and IRN has been generated after two or more days, so in this case looking at the provisions of the law the aforesaid invoice is not proper as per Rule 48(4), notified person has to prepare invoice by uploading specified particulars in FORM GST INV-01 on Invoice Registration Portal and after obtaining Invoice Reference Number (IRN).
As per Rule 48(5), any invoice issued by a notified person in any manner other than the manner specified in Rule 48(4), the same shall not be treated as an invoice. So, the document issued by notified person becomes legally valid only with an IRN.

Disclaimer:
Our conclusions are based on the completeness & accuracy of the facts stated therein & assumptions, which if not entirely complete or accurate, should be communicated to us, as the inaccuracy or incompleteness could have a material impact on our conclusions. The conclusions reached & views expressed in the note are based on our understanding of the law & regulations prevailing as of the date of this note as well as our past experience with the tax and / or regulatory authorities. However, there can be no assurance that the tax authorities or regulators will concur with our views.
Legislation, its judicial interpretation & the policies of the tax and / or regulatory authorities are subject to change from time to time & these may have a bearing on the advice that we have given. Accordingly, any change or amendment in the law or relevant regulations would necessitate a review of our comments & recommendations contained in this note. Unless specifically requested, we have no responsibility to carry out any review of our comments for changes in laws or regulations occurring after the date of this note.

Without prior permission of DMCGLOBAL SERVICES LLP, the contents of this study / note may not be quoted in whole or in part or otherwise referred to in any documents. This document is for the specific purpose and we accept no responsibility or liability to any party.