Ch 23 - Tax Invoice, Credit and Debit Notes | GST Saral by CA Dhruv Aggarwal PDF Download

 Page 1


CA DHRUV AGRAWAL – National Chairman Taxation Committee-All India Confederation of Small & Micro Industries Association  
 
 
 
 
 
 
 
 
 
 
 
 
CHAPTER 23 - Tax Invoice, Credi t and Debi t Notes 
 
 
 
 
 
CHAPTER 23 
 
Tax Invoice, Credit and Debit Notes 
 
EXECUTIVE SUMMARY 
Tax Invoice, Credit Note and Debit Note 
?   Every Taxable person supplying goods or services or both is required to issue 'tax invoice'. 
?   The Tax Invoice shall contain details as specified in rule 1. 
?   Tax Invoice should have unique consecutive  serial number in one or multiple  services,  including 
alphabets or numericals or special character hypen or dash or slash. 
?   It should contain HSN Code of goods or Accounting Code of services in respect of tax invoices of 
taxable persons having turnover beyond specified limits. 
?   Invoice for export should contain clear endorsement with required details 
?   If value of each invoice is less than Rs 200, consolidated invoice may be issued at end of the day. 
?   Tax Invoice for goods shall be in triplicate with specified marking. 
?   Tax Invoice for supply services shall be issued within 30 days of supply of service. In case of 
banking company, NBFC or FI i nvoice can be issued within 45 days. 
?   Tax Invoice for services shall be in duplicate with specified marking. 
?   In case of banking company, FI, NBFC or telecom operator providing service to their own branch 
in another State, they may issue invoice on quarterly basis. 
?   In case of exempt goods or services or when tax is paid under composition scheme, the supplier 
should issue Bill of Supply instead of Tax Invoice with details specified in rule 4. 
?   When Advance is received, Receipt Voucher should be issued with details as specified in rule 5 of 
Invoice rules. At that stage, GST is payable but recipient cannot avail input tax credit as goods or 
services or both have not been received by him. 
?   Supplementary Invoice, Debit Note or Credit Note should be seria ly numbered and shall contain 
details as specified in rule 6 of Invoice Rules. 
?   Invoice of Input Service Distributors shall contain details as specified in rule 7 of Invoice Rules. 
?   When material is sent for job work, Delivery Challan should be prepared in triplicate containing 
details specified in rule No. 8(1) of Invoice Rules. 
?   If goods are transported in semi-knocked down condition, complete invoice shall be issued before 
despatch  of  first  consignment   and  then  delivery  challan  should   be  issued   for  subsequent 
consignments. Original copy of invoice shall be sent with last consignment. 
23.1 Invoice for supply of goods or services or both 
 
Tax Invoice, Credit and Debit Notes are very important documents in administration of GST. E-documents 
Page 2


CA DHRUV AGRAWAL – National Chairman Taxation Committee-All India Confederation of Small & Micro Industries Association  
 
 
 
 
 
 
 
 
 
 
 
 
CHAPTER 23 - Tax Invoice, Credi t and Debi t Notes 
 
 
 
 
 
CHAPTER 23 
 
Tax Invoice, Credit and Debit Notes 
 
EXECUTIVE SUMMARY 
Tax Invoice, Credit Note and Debit Note 
?   Every Taxable person supplying goods or services or both is required to issue 'tax invoice'. 
?   The Tax Invoice shall contain details as specified in rule 1. 
?   Tax Invoice should have unique consecutive  serial number in one or multiple  services,  including 
alphabets or numericals or special character hypen or dash or slash. 
?   It should contain HSN Code of goods or Accounting Code of services in respect of tax invoices of 
taxable persons having turnover beyond specified limits. 
?   Invoice for export should contain clear endorsement with required details 
?   If value of each invoice is less than Rs 200, consolidated invoice may be issued at end of the day. 
?   Tax Invoice for goods shall be in triplicate with specified marking. 
?   Tax Invoice for supply services shall be issued within 30 days of supply of service. In case of 
banking company, NBFC or FI i nvoice can be issued within 45 days. 
?   Tax Invoice for services shall be in duplicate with specified marking. 
?   In case of banking company, FI, NBFC or telecom operator providing service to their own branch 
in another State, they may issue invoice on quarterly basis. 
?   In case of exempt goods or services or when tax is paid under composition scheme, the supplier 
should issue Bill of Supply instead of Tax Invoice with details specified in rule 4. 
?   When Advance is received, Receipt Voucher should be issued with details as specified in rule 5 of 
Invoice rules. At that stage, GST is payable but recipient cannot avail input tax credit as goods or 
services or both have not been received by him. 
?   Supplementary Invoice, Debit Note or Credit Note should be seria ly numbered and shall contain 
details as specified in rule 6 of Invoice Rules. 
?   Invoice of Input Service Distributors shall contain details as specified in rule 7 of Invoice Rules. 
?   When material is sent for job work, Delivery Challan should be prepared in triplicate containing 
details specified in rule No. 8(1) of Invoice Rules. 
?   If goods are transported in semi-knocked down condition, complete invoice shall be issued before 
despatch  of  first  consignment   and  then  delivery  challan  should   be  issued   for  subsequent 
consignments. Original copy of invoice shall be sent with last consignment. 
23.1 Invoice for supply of goods or services or both 
 
Tax Invoice, Credit and Debit Notes are very important documents in administration of GST. E-documents 
CA DHRUV AGRAWAL – National Chairman Taxation Committee-All India Confederation of Small & Micro Industries Association  
 
 
are permitted, even for transit checks and border posts. 
 
Revised Invoice is also a 'tax invoice' - For purpose of section 31 of CGST Act, The expression "tax 
i nvoice" shall include  any revised  invoice  issued  by the  supplier  in respect  of a  supply  made  earlier  - 
Explanation to section 31 of CGST Act. 
Supplementary   invoice  is Debit  Note -  For the purpose  of CGST Act,  'Debit Note'  shall include  a 
supplementary invoice - Explanation to section 32 of CGST Act. 
Supplier - "Supplier" in relation to any goods or services or both shall mean the person supplying the said 
goods or services or both and shall include an agent acting as such on behalf of such supplier in relation to the 
goods or services or both supplied - section 2(102) of CGST Act. 
Recipient - As per section 2(93) of CGST Act, "Recipient" of supply of goods or services or both means— 
 
(a)   where a consideration is payable for the supply of goods or services or both, the person who is 
liable to pay that consideration, 
(b)   where no consideration is payable for the supply of goods, the person to whom the goods are 
delivered or made available, or to whom possession or use of the goods is given or made available, 
and 
(c)   where no consideration is payable for the supply of a service, the person to whom the service is 
rendered. 
Any reference to a person to whom a supply is made shall be construed as a reference to the recipient of the 
supply and shall include an agent acting as such on behalf of the recipient in relation to the goods or services or 
both supplied. 
Tax invoice may not be issued if value less than  Rs 200 - Tax invoice may not be issued if value goods 
or services or both is less than Rs 200, subject to such conditions and in such manner as may be prescribed - 
section 31(3) of CGST Act, 
23.2 Tax Invoice in respect of goods 
 
A registered person supplying taxable goods sha l, before or at the timeof,- (a) removal of goods for supply to 
the recipient, where the supply involves movement of goods, or (b) delivery of goods or making available 
thereof to the recipient, in any other case,- - issue a tax invoice showing the description, quantity and value of 
goods, the tax charged thereon and such other particulars as may be prescribed - section 31(1) of CGST Act. 
Relaxation  in some cases - Central/State Government may, on the recommendation of the GST Council, by 
notification, specify the categories of goods and/or supplies in respect of which the tax invoice shall be issued, 
within such time as may be prescribed - proviso to section 31(1) of CGST Act. 
This relaxation may be given in case of clearances of sma l value samples or i nvoices by Banks etc., or some 
other peculiar situations. 
Removal - Meaning  - "Removal'', in relation to goods, means — 
 
(a)   despatch of the goods for delivery by the supplier thereof or by any other person acting on behalf of 
such supplier, or 
(b)   co lection of the goods by the recipient thereof or by any other person acting on behalf of such 
recipient - section 2(96) of CGST Act. 
23.2-1 Tax Invoice in case of continuous supply of goods 
 
"Conti nuous  supply of goods" means  a supply of goods  which is provided,  or agreed  to  be  provided, 
continuously or on recurrent basis, under a contract, whether or not by means of a wire, cable, pipeline or 
Page 3


CA DHRUV AGRAWAL – National Chairman Taxation Committee-All India Confederation of Small & Micro Industries Association  
 
 
 
 
 
 
 
 
 
 
 
 
CHAPTER 23 - Tax Invoice, Credi t and Debi t Notes 
 
 
 
 
 
CHAPTER 23 
 
Tax Invoice, Credit and Debit Notes 
 
EXECUTIVE SUMMARY 
Tax Invoice, Credit Note and Debit Note 
?   Every Taxable person supplying goods or services or both is required to issue 'tax invoice'. 
?   The Tax Invoice shall contain details as specified in rule 1. 
?   Tax Invoice should have unique consecutive  serial number in one or multiple  services,  including 
alphabets or numericals or special character hypen or dash or slash. 
?   It should contain HSN Code of goods or Accounting Code of services in respect of tax invoices of 
taxable persons having turnover beyond specified limits. 
?   Invoice for export should contain clear endorsement with required details 
?   If value of each invoice is less than Rs 200, consolidated invoice may be issued at end of the day. 
?   Tax Invoice for goods shall be in triplicate with specified marking. 
?   Tax Invoice for supply services shall be issued within 30 days of supply of service. In case of 
banking company, NBFC or FI i nvoice can be issued within 45 days. 
?   Tax Invoice for services shall be in duplicate with specified marking. 
?   In case of banking company, FI, NBFC or telecom operator providing service to their own branch 
in another State, they may issue invoice on quarterly basis. 
?   In case of exempt goods or services or when tax is paid under composition scheme, the supplier 
should issue Bill of Supply instead of Tax Invoice with details specified in rule 4. 
?   When Advance is received, Receipt Voucher should be issued with details as specified in rule 5 of 
Invoice rules. At that stage, GST is payable but recipient cannot avail input tax credit as goods or 
services or both have not been received by him. 
?   Supplementary Invoice, Debit Note or Credit Note should be seria ly numbered and shall contain 
details as specified in rule 6 of Invoice Rules. 
?   Invoice of Input Service Distributors shall contain details as specified in rule 7 of Invoice Rules. 
?   When material is sent for job work, Delivery Challan should be prepared in triplicate containing 
details specified in rule No. 8(1) of Invoice Rules. 
?   If goods are transported in semi-knocked down condition, complete invoice shall be issued before 
despatch  of  first  consignment   and  then  delivery  challan  should   be  issued   for  subsequent 
consignments. Original copy of invoice shall be sent with last consignment. 
23.1 Invoice for supply of goods or services or both 
 
Tax Invoice, Credit and Debit Notes are very important documents in administration of GST. E-documents 
CA DHRUV AGRAWAL – National Chairman Taxation Committee-All India Confederation of Small & Micro Industries Association  
 
 
are permitted, even for transit checks and border posts. 
 
Revised Invoice is also a 'tax invoice' - For purpose of section 31 of CGST Act, The expression "tax 
i nvoice" shall include  any revised  invoice  issued  by the  supplier  in respect  of a  supply  made  earlier  - 
Explanation to section 31 of CGST Act. 
Supplementary   invoice  is Debit  Note -  For the purpose  of CGST Act,  'Debit Note'  shall include  a 
supplementary invoice - Explanation to section 32 of CGST Act. 
Supplier - "Supplier" in relation to any goods or services or both shall mean the person supplying the said 
goods or services or both and shall include an agent acting as such on behalf of such supplier in relation to the 
goods or services or both supplied - section 2(102) of CGST Act. 
Recipient - As per section 2(93) of CGST Act, "Recipient" of supply of goods or services or both means— 
 
(a)   where a consideration is payable for the supply of goods or services or both, the person who is 
liable to pay that consideration, 
(b)   where no consideration is payable for the supply of goods, the person to whom the goods are 
delivered or made available, or to whom possession or use of the goods is given or made available, 
and 
(c)   where no consideration is payable for the supply of a service, the person to whom the service is 
rendered. 
Any reference to a person to whom a supply is made shall be construed as a reference to the recipient of the 
supply and shall include an agent acting as such on behalf of the recipient in relation to the goods or services or 
both supplied. 
Tax invoice may not be issued if value less than  Rs 200 - Tax invoice may not be issued if value goods 
or services or both is less than Rs 200, subject to such conditions and in such manner as may be prescribed - 
section 31(3) of CGST Act, 
23.2 Tax Invoice in respect of goods 
 
A registered person supplying taxable goods sha l, before or at the timeof,- (a) removal of goods for supply to 
the recipient, where the supply involves movement of goods, or (b) delivery of goods or making available 
thereof to the recipient, in any other case,- - issue a tax invoice showing the description, quantity and value of 
goods, the tax charged thereon and such other particulars as may be prescribed - section 31(1) of CGST Act. 
Relaxation  in some cases - Central/State Government may, on the recommendation of the GST Council, by 
notification, specify the categories of goods and/or supplies in respect of which the tax invoice shall be issued, 
within such time as may be prescribed - proviso to section 31(1) of CGST Act. 
This relaxation may be given in case of clearances of sma l value samples or i nvoices by Banks etc., or some 
other peculiar situations. 
Removal - Meaning  - "Removal'', in relation to goods, means — 
 
(a)   despatch of the goods for delivery by the supplier thereof or by any other person acting on behalf of 
such supplier, or 
(b)   co lection of the goods by the recipient thereof or by any other person acting on behalf of such 
recipient - section 2(96) of CGST Act. 
23.2-1 Tax Invoice in case of continuous supply of goods 
 
"Conti nuous  supply of goods" means  a supply of goods  which is provided,  or agreed  to  be  provided, 
continuously or on recurrent basis, under a contract, whether or not by means of a wire, cable, pipeline or 
CA DHRUV AGRAWAL – National Chairman Taxation Committee-All India Confederation of Small & Micro Industries Association  
 
 
other conduit, and for which the supplier invoices the recipient on a regular or periodic basis and includes 
supply of such goods as the Government may, subject to such conditions, as it may, by notification, specify - 
section 2(32) of CGST Act. 
In case of continuous supply of goods, where successive statements of accounts or successive payments are 
i nvolved, the invoice shall be issued before or at the time each such statement is issued or, as the case may be, 
each such payment is received - section 31(4) of CGST Act. 
23.2-2 Tax Invoice when goods sent on approval basis 
 
Notwithstanding anything contained in sub-section (1), where the goods being sent or taken on approval for 
sale or return are removed before the supply takes place, the invoice shall be issued before or at the time of 
supply or six months from the date of removal, whichever is earlier - section 31(7) of CGST Act. 
Thus, tax invoice must be issued within six months from removal. 
Bill of Supply may be issued at the time of removal of goods. 
23.2-3 Invoice for transportation of goods in knocked down condition in more than one consignments 
 
Where the goods are being transported in a semi knocked down or completely knocked down condition (a) 
the supplier shall issue the complete invoice before dispatch of the first consi gnment (b) the supplier shall issue 
a  delivery  challan  for  each  of  the  subsequent  consignments,  giving  reference  of  the  invoice  (c)  each 
consignment shall be accompanied by copies of the corresponding delivery challan along with a duly certified 
copy of the invoice; and (d) the original copy of the i nvoice shall be sent along with the last consignment - rule 
8(5) of Invoice Rules. 
 
23.2-4 Delivery challan instead of tax invoice for transportation of goods in specific circumstances 
 
For the fo lowing purposes, a delivery challan may be issued by consigner instead of tax invoice - (a) supply of 
liquid gas where the quantity at the time of removal from the place of business of the supplier is not known (b) 
transportation of goods for job work (c) transportation of goods for reasons other than by way of supply, or 
(d) such other supplies as may be notified by the Board - rule 8(1) of Invoice Rules. 
The delivery challan, seria ly numbered should be issued at the time of removal of goods for transportation, 
containing fo lowing details (i) date and number of the delivery challan ( i) name, address and GSTIN of the 
consigner, if registered ( i) name, address and GSTIN or UIN of the consi gnee, if registered (iv) HSN code 
and description of goods (v) quantity (provisional, where the exact quantity being supplied is not known) (vi) 
taxable value (v i) tax rate and tax amount - central tax, State tax, integrated  tax, Union territory tax or 
cess,where  the transportation  is for supply to the consignee  (v i) place  of supply,  in case of inter-State 
movement, and (ix) signature. 
Delivery challan  to be in triplicate - The delivery challan shall be prepared in triplicate, in case of supply 
of goods, with fo lowing marking - (a) the original copy being marked as ORIGINAL FOR CONSIGNEE (b) 
the duplicate copy being marked as DUPLICATE FOR TRANSPORTER; and (c) the triplicate copy being 
marked as TRIPLICATE FOR CONSIGNER - rule 7(3) of Invoice Rules. 
Where goods are being transported on a delivery challan in lieu of invoice, the same shall be declared in 
FORM [WAYBILL] - rule 7(3) of Invoice Rules [seems to be some mistake] 
 
23.2-5 If tax invoice could not be issued at the time of removal 
 
Where the goods being transported are for the purpose of supply to the recipient but the tax invoice could not 
be issued at the time of removal of goods for the purpose of supply, the supplier shall issue a tax invoice after 
delivery of goods - rule 7(4) of Invoice Rules. 
Page 4


CA DHRUV AGRAWAL – National Chairman Taxation Committee-All India Confederation of Small & Micro Industries Association  
 
 
 
 
 
 
 
 
 
 
 
 
CHAPTER 23 - Tax Invoice, Credi t and Debi t Notes 
 
 
 
 
 
CHAPTER 23 
 
Tax Invoice, Credit and Debit Notes 
 
EXECUTIVE SUMMARY 
Tax Invoice, Credit Note and Debit Note 
?   Every Taxable person supplying goods or services or both is required to issue 'tax invoice'. 
?   The Tax Invoice shall contain details as specified in rule 1. 
?   Tax Invoice should have unique consecutive  serial number in one or multiple  services,  including 
alphabets or numericals or special character hypen or dash or slash. 
?   It should contain HSN Code of goods or Accounting Code of services in respect of tax invoices of 
taxable persons having turnover beyond specified limits. 
?   Invoice for export should contain clear endorsement with required details 
?   If value of each invoice is less than Rs 200, consolidated invoice may be issued at end of the day. 
?   Tax Invoice for goods shall be in triplicate with specified marking. 
?   Tax Invoice for supply services shall be issued within 30 days of supply of service. In case of 
banking company, NBFC or FI i nvoice can be issued within 45 days. 
?   Tax Invoice for services shall be in duplicate with specified marking. 
?   In case of banking company, FI, NBFC or telecom operator providing service to their own branch 
in another State, they may issue invoice on quarterly basis. 
?   In case of exempt goods or services or when tax is paid under composition scheme, the supplier 
should issue Bill of Supply instead of Tax Invoice with details specified in rule 4. 
?   When Advance is received, Receipt Voucher should be issued with details as specified in rule 5 of 
Invoice rules. At that stage, GST is payable but recipient cannot avail input tax credit as goods or 
services or both have not been received by him. 
?   Supplementary Invoice, Debit Note or Credit Note should be seria ly numbered and shall contain 
details as specified in rule 6 of Invoice Rules. 
?   Invoice of Input Service Distributors shall contain details as specified in rule 7 of Invoice Rules. 
?   When material is sent for job work, Delivery Challan should be prepared in triplicate containing 
details specified in rule No. 8(1) of Invoice Rules. 
?   If goods are transported in semi-knocked down condition, complete invoice shall be issued before 
despatch  of  first  consignment   and  then  delivery  challan  should   be  issued   for  subsequent 
consignments. Original copy of invoice shall be sent with last consignment. 
23.1 Invoice for supply of goods or services or both 
 
Tax Invoice, Credit and Debit Notes are very important documents in administration of GST. E-documents 
CA DHRUV AGRAWAL – National Chairman Taxation Committee-All India Confederation of Small & Micro Industries Association  
 
 
are permitted, even for transit checks and border posts. 
 
Revised Invoice is also a 'tax invoice' - For purpose of section 31 of CGST Act, The expression "tax 
i nvoice" shall include  any revised  invoice  issued  by the  supplier  in respect  of a  supply  made  earlier  - 
Explanation to section 31 of CGST Act. 
Supplementary   invoice  is Debit  Note -  For the purpose  of CGST Act,  'Debit Note'  shall include  a 
supplementary invoice - Explanation to section 32 of CGST Act. 
Supplier - "Supplier" in relation to any goods or services or both shall mean the person supplying the said 
goods or services or both and shall include an agent acting as such on behalf of such supplier in relation to the 
goods or services or both supplied - section 2(102) of CGST Act. 
Recipient - As per section 2(93) of CGST Act, "Recipient" of supply of goods or services or both means— 
 
(a)   where a consideration is payable for the supply of goods or services or both, the person who is 
liable to pay that consideration, 
(b)   where no consideration is payable for the supply of goods, the person to whom the goods are 
delivered or made available, or to whom possession or use of the goods is given or made available, 
and 
(c)   where no consideration is payable for the supply of a service, the person to whom the service is 
rendered. 
Any reference to a person to whom a supply is made shall be construed as a reference to the recipient of the 
supply and shall include an agent acting as such on behalf of the recipient in relation to the goods or services or 
both supplied. 
Tax invoice may not be issued if value less than  Rs 200 - Tax invoice may not be issued if value goods 
or services or both is less than Rs 200, subject to such conditions and in such manner as may be prescribed - 
section 31(3) of CGST Act, 
23.2 Tax Invoice in respect of goods 
 
A registered person supplying taxable goods sha l, before or at the timeof,- (a) removal of goods for supply to 
the recipient, where the supply involves movement of goods, or (b) delivery of goods or making available 
thereof to the recipient, in any other case,- - issue a tax invoice showing the description, quantity and value of 
goods, the tax charged thereon and such other particulars as may be prescribed - section 31(1) of CGST Act. 
Relaxation  in some cases - Central/State Government may, on the recommendation of the GST Council, by 
notification, specify the categories of goods and/or supplies in respect of which the tax invoice shall be issued, 
within such time as may be prescribed - proviso to section 31(1) of CGST Act. 
This relaxation may be given in case of clearances of sma l value samples or i nvoices by Banks etc., or some 
other peculiar situations. 
Removal - Meaning  - "Removal'', in relation to goods, means — 
 
(a)   despatch of the goods for delivery by the supplier thereof or by any other person acting on behalf of 
such supplier, or 
(b)   co lection of the goods by the recipient thereof or by any other person acting on behalf of such 
recipient - section 2(96) of CGST Act. 
23.2-1 Tax Invoice in case of continuous supply of goods 
 
"Conti nuous  supply of goods" means  a supply of goods  which is provided,  or agreed  to  be  provided, 
continuously or on recurrent basis, under a contract, whether or not by means of a wire, cable, pipeline or 
CA DHRUV AGRAWAL – National Chairman Taxation Committee-All India Confederation of Small & Micro Industries Association  
 
 
other conduit, and for which the supplier invoices the recipient on a regular or periodic basis and includes 
supply of such goods as the Government may, subject to such conditions, as it may, by notification, specify - 
section 2(32) of CGST Act. 
In case of continuous supply of goods, where successive statements of accounts or successive payments are 
i nvolved, the invoice shall be issued before or at the time each such statement is issued or, as the case may be, 
each such payment is received - section 31(4) of CGST Act. 
23.2-2 Tax Invoice when goods sent on approval basis 
 
Notwithstanding anything contained in sub-section (1), where the goods being sent or taken on approval for 
sale or return are removed before the supply takes place, the invoice shall be issued before or at the time of 
supply or six months from the date of removal, whichever is earlier - section 31(7) of CGST Act. 
Thus, tax invoice must be issued within six months from removal. 
Bill of Supply may be issued at the time of removal of goods. 
23.2-3 Invoice for transportation of goods in knocked down condition in more than one consignments 
 
Where the goods are being transported in a semi knocked down or completely knocked down condition (a) 
the supplier shall issue the complete invoice before dispatch of the first consi gnment (b) the supplier shall issue 
a  delivery  challan  for  each  of  the  subsequent  consignments,  giving  reference  of  the  invoice  (c)  each 
consignment shall be accompanied by copies of the corresponding delivery challan along with a duly certified 
copy of the invoice; and (d) the original copy of the i nvoice shall be sent along with the last consignment - rule 
8(5) of Invoice Rules. 
 
23.2-4 Delivery challan instead of tax invoice for transportation of goods in specific circumstances 
 
For the fo lowing purposes, a delivery challan may be issued by consigner instead of tax invoice - (a) supply of 
liquid gas where the quantity at the time of removal from the place of business of the supplier is not known (b) 
transportation of goods for job work (c) transportation of goods for reasons other than by way of supply, or 
(d) such other supplies as may be notified by the Board - rule 8(1) of Invoice Rules. 
The delivery challan, seria ly numbered should be issued at the time of removal of goods for transportation, 
containing fo lowing details (i) date and number of the delivery challan ( i) name, address and GSTIN of the 
consigner, if registered ( i) name, address and GSTIN or UIN of the consi gnee, if registered (iv) HSN code 
and description of goods (v) quantity (provisional, where the exact quantity being supplied is not known) (vi) 
taxable value (v i) tax rate and tax amount - central tax, State tax, integrated  tax, Union territory tax or 
cess,where  the transportation  is for supply to the consignee  (v i) place  of supply,  in case of inter-State 
movement, and (ix) signature. 
Delivery challan  to be in triplicate - The delivery challan shall be prepared in triplicate, in case of supply 
of goods, with fo lowing marking - (a) the original copy being marked as ORIGINAL FOR CONSIGNEE (b) 
the duplicate copy being marked as DUPLICATE FOR TRANSPORTER; and (c) the triplicate copy being 
marked as TRIPLICATE FOR CONSIGNER - rule 7(3) of Invoice Rules. 
Where goods are being transported on a delivery challan in lieu of invoice, the same shall be declared in 
FORM [WAYBILL] - rule 7(3) of Invoice Rules [seems to be some mistake] 
 
23.2-5 If tax invoice could not be issued at the time of removal 
 
Where the goods being transported are for the purpose of supply to the recipient but the tax invoice could not 
be issued at the time of removal of goods for the purpose of supply, the supplier shall issue a tax invoice after 
delivery of goods - rule 7(4) of Invoice Rules. 
CA DHRUV AGRAWAL – National Chairman Taxation Committee-All India Confederation of Small & Micro Industries Association  
 
 
In view of this rule, it can be argued that non-issue of tax invoice at the time of removal is not an offence. 
If it is not possible to issue tax invoice, at least delivery challan should be issued. 
23.3 Tax Invoice in respect of services 
 
A registered taxable person supplying taxable services sha l, before or after the provision of service but within 
a prescribed period, issue a tax invoice, showing the description, value, the tax charged thereon and such other 
particulars as may be prescribed - section31(2) of CGST Act. 
Other document  instead  of tax invoice or tax invoice may not be issued - Central/State Government 
may, on the recommendation of the Council, by notification and subject to such conditions and limitations as 
may be prescribed, specify the categories of services in respect of which (a) any other document issued in 
relation to the supply shall be deemed to be a tax i nvoice, or (b) tax invoice may not be issued - section 32(2) 
of CGST Act. 
Invoice of supplier of service - The i nvoice shall be prepared in duplicate, in case of supply of services, in 
the fo lowing manner:-  (a) the original copy being marked as ORIGINAL FOR RECIPIENT; and (b) the 
duplicate copy being marked as DUPLICATE FOR SUPPLIER - rule 3(2) of Invoice Rules. 
23.3-1 Tax Invoice in case of continuous supply of services 
 
"Conti nuous supply of services" means a supply of services which is provided, or agreed to be provided, 
continuously  or on recurrent  basis,  under a contract,  for a period  exceeding three months  with periodic 
payment obligations and includes supply of such services as the Government may, subject to such conditions, 
as it may, by notification, specify - section 2(33) of CGST Act. 
In case of continuous supply of services, provisions for issue of tax invoice are as below. These provisions are 
subject to section 31(3)(d)  of CGST Act,  which provide  for issue  of receipt voucher  when advance  is 
received - section 31(5) of CGST Act. 
Before due date of payment - Where the due date of payment is ascertainable from the contract, the invoice 
shall be issued on or before due date of payment.  [However,  if advance  is received,  receipt voucher is 
required to be issued and not tax invoice] 
When due date of payment is not ascertainable, date on which payment received - Where the due date 
of payment is not ascertainable  from the contract, the invoice shall be issued before or at the time when 
supplier receives payment [However, if advance is received, receipt voucher is required to be issued and not 
tax invoice] 
When payment  linked with completion  of event i.e. milestones - Where the payment is linked to the 
completion of an event (i.e. milestones as specified in contract), the invoice shall be issued on or before date of 
completion of that event. 
For example, in construction contracts, various milestones (like plinth, first floor, slab etc.) may be prescribed 
for payments. In that case, tax invoice is required to be issued when each such milestone is reached. 
23.3-2 Tax Invoice when supply of services ceases before completion of supply 
 
In a case where the supply of services ceases under a contract before the completion of the supply, the invoice 
shall be issued at the time when the supply ceases and such invoice shall be issued to the extent of the supply 
effected before such cessation - section 31(6) of CGST Act. 
23.3-3 Time limit for issuing tax invoice for services 
 
The i nvoice in case of taxable supply of services, shall be issued within a period of thirty days from the date of 
supply of service - rule 2 of Invoice Rules. 
Page 5


CA DHRUV AGRAWAL – National Chairman Taxation Committee-All India Confederation of Small & Micro Industries Association  
 
 
 
 
 
 
 
 
 
 
 
 
CHAPTER 23 - Tax Invoice, Credi t and Debi t Notes 
 
 
 
 
 
CHAPTER 23 
 
Tax Invoice, Credit and Debit Notes 
 
EXECUTIVE SUMMARY 
Tax Invoice, Credit Note and Debit Note 
?   Every Taxable person supplying goods or services or both is required to issue 'tax invoice'. 
?   The Tax Invoice shall contain details as specified in rule 1. 
?   Tax Invoice should have unique consecutive  serial number in one or multiple  services,  including 
alphabets or numericals or special character hypen or dash or slash. 
?   It should contain HSN Code of goods or Accounting Code of services in respect of tax invoices of 
taxable persons having turnover beyond specified limits. 
?   Invoice for export should contain clear endorsement with required details 
?   If value of each invoice is less than Rs 200, consolidated invoice may be issued at end of the day. 
?   Tax Invoice for goods shall be in triplicate with specified marking. 
?   Tax Invoice for supply services shall be issued within 30 days of supply of service. In case of 
banking company, NBFC or FI i nvoice can be issued within 45 days. 
?   Tax Invoice for services shall be in duplicate with specified marking. 
?   In case of banking company, FI, NBFC or telecom operator providing service to their own branch 
in another State, they may issue invoice on quarterly basis. 
?   In case of exempt goods or services or when tax is paid under composition scheme, the supplier 
should issue Bill of Supply instead of Tax Invoice with details specified in rule 4. 
?   When Advance is received, Receipt Voucher should be issued with details as specified in rule 5 of 
Invoice rules. At that stage, GST is payable but recipient cannot avail input tax credit as goods or 
services or both have not been received by him. 
?   Supplementary Invoice, Debit Note or Credit Note should be seria ly numbered and shall contain 
details as specified in rule 6 of Invoice Rules. 
?   Invoice of Input Service Distributors shall contain details as specified in rule 7 of Invoice Rules. 
?   When material is sent for job work, Delivery Challan should be prepared in triplicate containing 
details specified in rule No. 8(1) of Invoice Rules. 
?   If goods are transported in semi-knocked down condition, complete invoice shall be issued before 
despatch  of  first  consignment   and  then  delivery  challan  should   be  issued   for  subsequent 
consignments. Original copy of invoice shall be sent with last consignment. 
23.1 Invoice for supply of goods or services or both 
 
Tax Invoice, Credit and Debit Notes are very important documents in administration of GST. E-documents 
CA DHRUV AGRAWAL – National Chairman Taxation Committee-All India Confederation of Small & Micro Industries Association  
 
 
are permitted, even for transit checks and border posts. 
 
Revised Invoice is also a 'tax invoice' - For purpose of section 31 of CGST Act, The expression "tax 
i nvoice" shall include  any revised  invoice  issued  by the  supplier  in respect  of a  supply  made  earlier  - 
Explanation to section 31 of CGST Act. 
Supplementary   invoice  is Debit  Note -  For the purpose  of CGST Act,  'Debit Note'  shall include  a 
supplementary invoice - Explanation to section 32 of CGST Act. 
Supplier - "Supplier" in relation to any goods or services or both shall mean the person supplying the said 
goods or services or both and shall include an agent acting as such on behalf of such supplier in relation to the 
goods or services or both supplied - section 2(102) of CGST Act. 
Recipient - As per section 2(93) of CGST Act, "Recipient" of supply of goods or services or both means— 
 
(a)   where a consideration is payable for the supply of goods or services or both, the person who is 
liable to pay that consideration, 
(b)   where no consideration is payable for the supply of goods, the person to whom the goods are 
delivered or made available, or to whom possession or use of the goods is given or made available, 
and 
(c)   where no consideration is payable for the supply of a service, the person to whom the service is 
rendered. 
Any reference to a person to whom a supply is made shall be construed as a reference to the recipient of the 
supply and shall include an agent acting as such on behalf of the recipient in relation to the goods or services or 
both supplied. 
Tax invoice may not be issued if value less than  Rs 200 - Tax invoice may not be issued if value goods 
or services or both is less than Rs 200, subject to such conditions and in such manner as may be prescribed - 
section 31(3) of CGST Act, 
23.2 Tax Invoice in respect of goods 
 
A registered person supplying taxable goods sha l, before or at the timeof,- (a) removal of goods for supply to 
the recipient, where the supply involves movement of goods, or (b) delivery of goods or making available 
thereof to the recipient, in any other case,- - issue a tax invoice showing the description, quantity and value of 
goods, the tax charged thereon and such other particulars as may be prescribed - section 31(1) of CGST Act. 
Relaxation  in some cases - Central/State Government may, on the recommendation of the GST Council, by 
notification, specify the categories of goods and/or supplies in respect of which the tax invoice shall be issued, 
within such time as may be prescribed - proviso to section 31(1) of CGST Act. 
This relaxation may be given in case of clearances of sma l value samples or i nvoices by Banks etc., or some 
other peculiar situations. 
Removal - Meaning  - "Removal'', in relation to goods, means — 
 
(a)   despatch of the goods for delivery by the supplier thereof or by any other person acting on behalf of 
such supplier, or 
(b)   co lection of the goods by the recipient thereof or by any other person acting on behalf of such 
recipient - section 2(96) of CGST Act. 
23.2-1 Tax Invoice in case of continuous supply of goods 
 
"Conti nuous  supply of goods" means  a supply of goods  which is provided,  or agreed  to  be  provided, 
continuously or on recurrent basis, under a contract, whether or not by means of a wire, cable, pipeline or 
CA DHRUV AGRAWAL – National Chairman Taxation Committee-All India Confederation of Small & Micro Industries Association  
 
 
other conduit, and for which the supplier invoices the recipient on a regular or periodic basis and includes 
supply of such goods as the Government may, subject to such conditions, as it may, by notification, specify - 
section 2(32) of CGST Act. 
In case of continuous supply of goods, where successive statements of accounts or successive payments are 
i nvolved, the invoice shall be issued before or at the time each such statement is issued or, as the case may be, 
each such payment is received - section 31(4) of CGST Act. 
23.2-2 Tax Invoice when goods sent on approval basis 
 
Notwithstanding anything contained in sub-section (1), where the goods being sent or taken on approval for 
sale or return are removed before the supply takes place, the invoice shall be issued before or at the time of 
supply or six months from the date of removal, whichever is earlier - section 31(7) of CGST Act. 
Thus, tax invoice must be issued within six months from removal. 
Bill of Supply may be issued at the time of removal of goods. 
23.2-3 Invoice for transportation of goods in knocked down condition in more than one consignments 
 
Where the goods are being transported in a semi knocked down or completely knocked down condition (a) 
the supplier shall issue the complete invoice before dispatch of the first consi gnment (b) the supplier shall issue 
a  delivery  challan  for  each  of  the  subsequent  consignments,  giving  reference  of  the  invoice  (c)  each 
consignment shall be accompanied by copies of the corresponding delivery challan along with a duly certified 
copy of the invoice; and (d) the original copy of the i nvoice shall be sent along with the last consignment - rule 
8(5) of Invoice Rules. 
 
23.2-4 Delivery challan instead of tax invoice for transportation of goods in specific circumstances 
 
For the fo lowing purposes, a delivery challan may be issued by consigner instead of tax invoice - (a) supply of 
liquid gas where the quantity at the time of removal from the place of business of the supplier is not known (b) 
transportation of goods for job work (c) transportation of goods for reasons other than by way of supply, or 
(d) such other supplies as may be notified by the Board - rule 8(1) of Invoice Rules. 
The delivery challan, seria ly numbered should be issued at the time of removal of goods for transportation, 
containing fo lowing details (i) date and number of the delivery challan ( i) name, address and GSTIN of the 
consigner, if registered ( i) name, address and GSTIN or UIN of the consi gnee, if registered (iv) HSN code 
and description of goods (v) quantity (provisional, where the exact quantity being supplied is not known) (vi) 
taxable value (v i) tax rate and tax amount - central tax, State tax, integrated  tax, Union territory tax or 
cess,where  the transportation  is for supply to the consignee  (v i) place  of supply,  in case of inter-State 
movement, and (ix) signature. 
Delivery challan  to be in triplicate - The delivery challan shall be prepared in triplicate, in case of supply 
of goods, with fo lowing marking - (a) the original copy being marked as ORIGINAL FOR CONSIGNEE (b) 
the duplicate copy being marked as DUPLICATE FOR TRANSPORTER; and (c) the triplicate copy being 
marked as TRIPLICATE FOR CONSIGNER - rule 7(3) of Invoice Rules. 
Where goods are being transported on a delivery challan in lieu of invoice, the same shall be declared in 
FORM [WAYBILL] - rule 7(3) of Invoice Rules [seems to be some mistake] 
 
23.2-5 If tax invoice could not be issued at the time of removal 
 
Where the goods being transported are for the purpose of supply to the recipient but the tax invoice could not 
be issued at the time of removal of goods for the purpose of supply, the supplier shall issue a tax invoice after 
delivery of goods - rule 7(4) of Invoice Rules. 
CA DHRUV AGRAWAL – National Chairman Taxation Committee-All India Confederation of Small & Micro Industries Association  
 
 
In view of this rule, it can be argued that non-issue of tax invoice at the time of removal is not an offence. 
If it is not possible to issue tax invoice, at least delivery challan should be issued. 
23.3 Tax Invoice in respect of services 
 
A registered taxable person supplying taxable services sha l, before or after the provision of service but within 
a prescribed period, issue a tax invoice, showing the description, value, the tax charged thereon and such other 
particulars as may be prescribed - section31(2) of CGST Act. 
Other document  instead  of tax invoice or tax invoice may not be issued - Central/State Government 
may, on the recommendation of the Council, by notification and subject to such conditions and limitations as 
may be prescribed, specify the categories of services in respect of which (a) any other document issued in 
relation to the supply shall be deemed to be a tax i nvoice, or (b) tax invoice may not be issued - section 32(2) 
of CGST Act. 
Invoice of supplier of service - The i nvoice shall be prepared in duplicate, in case of supply of services, in 
the fo lowing manner:-  (a) the original copy being marked as ORIGINAL FOR RECIPIENT; and (b) the 
duplicate copy being marked as DUPLICATE FOR SUPPLIER - rule 3(2) of Invoice Rules. 
23.3-1 Tax Invoice in case of continuous supply of services 
 
"Conti nuous supply of services" means a supply of services which is provided, or agreed to be provided, 
continuously  or on recurrent  basis,  under a contract,  for a period  exceeding three months  with periodic 
payment obligations and includes supply of such services as the Government may, subject to such conditions, 
as it may, by notification, specify - section 2(33) of CGST Act. 
In case of continuous supply of services, provisions for issue of tax invoice are as below. These provisions are 
subject to section 31(3)(d)  of CGST Act,  which provide  for issue  of receipt voucher  when advance  is 
received - section 31(5) of CGST Act. 
Before due date of payment - Where the due date of payment is ascertainable from the contract, the invoice 
shall be issued on or before due date of payment.  [However,  if advance  is received,  receipt voucher is 
required to be issued and not tax invoice] 
When due date of payment is not ascertainable, date on which payment received - Where the due date 
of payment is not ascertainable  from the contract, the invoice shall be issued before or at the time when 
supplier receives payment [However, if advance is received, receipt voucher is required to be issued and not 
tax invoice] 
When payment  linked with completion  of event i.e. milestones - Where the payment is linked to the 
completion of an event (i.e. milestones as specified in contract), the invoice shall be issued on or before date of 
completion of that event. 
For example, in construction contracts, various milestones (like plinth, first floor, slab etc.) may be prescribed 
for payments. In that case, tax invoice is required to be issued when each such milestone is reached. 
23.3-2 Tax Invoice when supply of services ceases before completion of supply 
 
In a case where the supply of services ceases under a contract before the completion of the supply, the invoice 
shall be issued at the time when the supply ceases and such invoice shall be issued to the extent of the supply 
effected before such cessation - section 31(6) of CGST Act. 
23.3-3 Time limit for issuing tax invoice for services 
 
The i nvoice in case of taxable supply of services, shall be issued within a period of thirty days from the date of 
supply of service - rule 2 of Invoice Rules. 
CA DHRUV AGRAWAL – National Chairman Taxation Committee-All India Confederation of Small & Micro Industries Association  
 
 
Where the supplier of services is an insurer or a banking company or a financial institution, or NBFC, invoice 
can be issued within forty five days from the date of supply of service - first proviso to rule 2 of Invoice Rules. 
23.3-4 Relaxations to insurance, Bank, FI and NBFC in issuing invoice 
 
Where the supplier of taxable service is an insurer or a banking company or a financial institution or NBFC, 
the said supplier shall issue a tax invoice or any other document in lieu thereof, by whatever name ca led, 
whether or not seria ly numbered, and whether or not containing the address of the recipient of taxable service 
but containing other information as prescribed under rule 1. - rule 7(2) of Invoice Rules. 
23.3-5 Invoice by Bank, FI, NBFC or telecom company to their branch in other State 
 
Where the supplier of services is an insurer or a banking company or a financial institution or NBFC, or a 
telecom operator, or any other class of supplier of services as may be notified by the Government on the 
recommendations of the Council, making taxable supplies of services between distinct persons as specified in 
section 25 as referred to in Entry 2 of Schedule I, may issue the invoice before or at the time such supplier 
records the same in his books of account or before the expiry of the quarter during which the supply was 
made - second proviso to rule 2 of Invoice Rules. 
Thus, Bank, FI, NBFC or telecom company in respect of services provided to their branch in other State can 
issue invoice on quarterly basis. 
23.3-6 Tax Invoice of Goods Transport Agency 
 
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, the said supplier shall issue a tax invoice or any other 
document in lieu thereof, by whatever name ca led, containing the gross weight of the consignment, name of the 
consignor and the consignee, registration number of goods carriage in which the goods are transported, details 
of goods transported, details of place of origin and destination, GSTIN of the person liable for paying tax 
whether  as  consignor,  consignee  or  goods  transport  agency,  and  also  containing  other  information  as 
prescribed under rule 1 of Invoice Rules - - rule 7(3) of Invoice Rules. 
23.3-7 Ticket issued in case of passenger transportation service is tax invoice 
 
Where the supplier of taxable service is supplying passenger transportation service, a tax invoice shall include 
ticket in any form, by whatever name ca led, whether or not seria ly numbered, and whether or not containing 
the address of the recipient of service but containing other information as prescribed under rule 1 - rule 7(4) of 
Invoice Rules. 
23.3-8 Tax Invoice by Input Service Distributor 
 
An ISD i nvoice or an ISD credit note issued by an Input Service Distributor shall contain the fo lowing details:- 
(a) name, address and GSTIN of the Input Service Distributor (b) a consecutive serial number containing 
alphabets or numerals or special characters hyphen or dash and slash symbolised as , "-", "/", respectively, and 
any combination thereof, unique for a financial year (c) date of its issue (d) name, address and GSTIN of the 
recipient to whom the credit is distributed  (e) amount of the credit distributed; and (f) signature or digital 
signature of the Input Service Distributor or his authorized representative - rule 7(1) of Invoice Rules. 
Invoice of ISD of banking,  FI or NBFC  - Where the Input Service Distributor is an office of a banking 
company or a financial institution or NBFC,  a tax invoice shall include any document in lieu thereof,  by 
whatever name ca led, whether or not seria ly numbered but containing the information as prescribed above - 
proviso to rule 7(1) of Invoice Rules. 
23.4 Issue of revised invoices for goods sold during period prior to registration 
 
A registered taxable person may, within one month from the date of issuance of certificate of registration and in