It is to apprise you that recently the Goods and Services Tax (‘GST’) portal has issued new FAQs on e-invoices. One of the FAQs is as under:
“Question: Do you need to upload RCM Invoices also?
Answer: Yes, if you are eligible for e-Invoicing, all the invoices including RCM invoices issued by the Supplier need to be registered.”
From the above FAQ, GST portal is suggesting to mandatorily issue an e-invoice for RCM transactions from un-registered suppliers.
| Comments
- Although one may issue e-invoice for RCM transactions as a conservative approach. In our view, legally, there is no such requirement of preparing e-invoice for RCM transaction. The basis of our view is explained in ensuing points.
- Notification No. 13/2020-Central Tax, dated March 21, 2020, provides that a registered person having specified turnover shall prepare an e-invoice “in respect of supply of goods or services or both to a registered person or for exports”. [Emphasis Supplied]
- The above emphasised words clearly show that e-invoice is applicable in respect of following supplies:
- Supply of goods or services or both to a registered person; or
- Exports
- Kindly note that under Section 31 of the CGST Act (pertaining to invoice), supply of goods or services to a registered person [Section 31(1) & (2)] is differentiated from supply received from an unregistered supplier [Section 31(3)(f)].
- Therefore, if the intention of Government was to apply e-invoicing provision to RCM self-invoices, it would have clearly specified the same in the above-mentioned notification.
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