Features of E-Invoice System


Features of E-Invoice System
Feb, 2020
By Vikash Dhanania
Resource E-invoicing            

The Format of Unique Invoice Reference Number (IRN):

The unique IRN will be based on the computation of hash of GSTIN of the generator of the document (invoice or credit note or debit note), Financial Year, Document Type and Document number like an invoice number. This hash will be as published in the e-invoice standard and unique for this combination. This way hash will always be the same irrespective of the registrar who processes it.

To ensure deduplication, the registrar will be required to send the hash to Central Registry of GST System to confirm whether the same has been reported already. In case it has been reported by another registrar (as and when more registrars – IRPs – are added) and the Central Registry already has the same IRN, then the registrar will reject the registration and inform the sender by sending appropriate error code. Only unique invoices from a taxpayer will be accepted and registered by the registrar.

Digital Signing by e-Invoice Registration Portal:

The invoice data will be uploaded on the IRP (Invoice Registration Portal), which will also generate the hash (as the IRN) and then digitally sign it with the private key of the IRP. The IRP will sign the complete e-invoice JSON payload (that includes the IRN/hash). Thereafter, this e-invoice signed by the IRP will be a valid e-invoice for the seller and can be used by the seller for his business transactions. The IRP will also push this signed e-invoice to the GST and the E-Way bill systems.

QR Code:

The IRP will also generate a QR code containing the unique IRN (hash) along with some important parameters of invoice and digital signature so that it can be verified on the central portal as well as by an Offline App. This will be helpful for tax officers checking the invoice on the roadside where the Internet may not be available all the time. The seller will be returned a signed JSON with all details including a QR code. The QR code will consist of the following e-invoice parameters:

a. GSTIN of supplier

b. GSTIN of Recipient

c. Invoice number as given by Supplier

d. Date of the generation of invoice

e. Invoice value (taxable value and gross tax)

f. Number of line items.

g. HSN Code of main item (the line item having highest taxable value)

h. Unique Invoice Reference Number (hash)

Note: It is the signed QR code which will be easily verifiable by taxpayers as well as Tax Officers to validate whether the e-invoice has been reported to the IRP and accepted by it, as it will contain both the IRN as well as the Digital Signature of IRP as proof of having received and registered the e-invoice. If the signed JSON is tampered, then e-invoice will become invalid and the digital signature will fail.

An offline app will be provided for anyone to download to authenticate the QR code of the e- invoice offline and its basic details. The facility to view the e-invoice will be provided to buyers or tax officers, on the GST System / E-way bill system.

Note: The facility of e-invoice verification is planned to be made available only through the GST System and not the IRP. This is because the IRP will not have the mandate to store invoices for more than 24 hours. In order to achieve speed and efficiency, the IRP will be a lean and focused portal for providing invoice registration and verification service, IRN and the QR codes. Hence, storing of the invoices will not be a feature of the IRP.

Multiple Registrar for IRN System:

Multiple registrars (IRPs) will be put in place to ensure 24X7 operations without any break. To start with, NIC will be the first Registrar. GST System will also provide IRP services in due course of time. Based on experience, more registrars (IRPs) will be added.

Standardization of E-Invoice:

A technical group constituted by the GST Council Secretariat has drafted standards for e-invoice after having industry consultation. The e-invoice schema and template, as approved by the GST Council, are available at h ttps://www.gstn.org/e-invoice/. The same has been notified by the Govt of India vide Notification No. 02/2020 dated 01st Jan 2020.