cancellation of e-invoice under GST

The e-invoicing system adds more automation and ease to the process of filing returns while also improving controls against tax evasion. we take a look at the amendment and cancellation of e-invoice in GST.

I have made a mistake in the invoice and have already generated an e-invoice.

Can I modify the e-invoice?

I entered incorrect or incorrect data; can I change the e-invoice and correct the details?

These are some of the frequent everyday situations that some of us must have encountered since e-invoicing was introduced.

No matter how careful you are when invoicing, mistakes happen, and you may have to edit or modify the e-invoice. While situations seem to happen, the vital question is whether e-invoices can be altered or edited after IRN and QR codes are already generated.

'No,' is the answer.

Once an invoice's IRN has been generated, the e-invoice cannot be modified, amended, or deleted.

You may wonder what to do now that the e-invoice details are incorrect and cannot be changed.

Are there any other possibilities? 

Yes, there are alternatives to modifying the e-invoice to correct the e-invoice details before generating the IRN inside your ERP or invoicing App

The system of e-invoicing brings further automation and ease to the process of filing returns while also improving the controls against tax evasion. But, first, let us look at the amendment system and cancellation of e-invoice in GST.

The e-Invoicing system for B2B transactions has now been extended to those with an annual aggregate turnover of more than Rs.10 crore up to Rs.20 crore starting from 1st October 2022, vide notification no. 17/2022.

Is it possible to cancel an e-invoice?

There is a 24-hour window for e-invoice amendment and cancellation. The E-invoice cancellation process is quite simple and proves convenient in case of cancellation of the order by the buyer or incorrect or double entry of the e-invoice.

GST portal e-invoice cancellation

 On the government portal, there are two e-Invoice cancellation procedures.

Cancel a single bill

  1. Sign in to the e-Invoice portal and select Cancel from the sidebar.
  2. Enter the Acknowledgement number or the IRN and press the Go button.
  3. Select the e-Invoice, enter the Cancellation Reason, and click Submit.

Cancel e-Invoice in GST in Bulk

  1. Navigate to the e-Invoice portal. Then, go to Help-Tools-Bulk Generation Tools.
  2. Download the offline utility e-Invoice Cancel by IRN - JSON Preparation.
  3. Click Validate after entering the IRN, Reason for Cancellation, and Cancel Remarks.
  4. Once the file has been validated, click Prepare JSON.
  5. Log in to the e-Invoice portal, select e-Invoice, then Bulk IRN Cancel, and then upload the JSON file.

Partial cancellation of an e-Invoice is not possible. Only the entire invoice may be cancelled. Furthermore, no changes to the e-invoice are permitted. If any changes to the invoice details uploaded on the IRP are required, they can only be made through the GST portal while filing GSTR-1. However, these changes will be forwarded to the appropriate officer, who may request additional information from the taxpayer.

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IRP Functions: A Quick Overview

IRP amendments in e-invoice under GST

Before delving into the Amendment and cancellation of e-invoice in GST, it is important to understand that an e-invoice is created using a prescribed schema and that each such invoice is assigned a unique Invoice Reference Number (IRN) using a hash generation algorithm. The taxpayer can either generate the IRN or upload the invoice to the IRP, which will generate the IRN. If the taxpayer generates the IRN, the IRP must validate it.

The IRP is the entity in charge of authenticating e-invoices by determining whether the invoice adheres to the prescribed schema and mandatory parameters, whether the IRN is unique, and so on. As a result, the websites of an IRP and the GST portal are distinct. When an IRP validates an e-invoice, it sends the information to the GST portal.

What is the IRP Amendment and Cancellation

IRP amendment and cancellation IRPs will process each invoice individually. On the other hand, the IRP will have a lean and focused system to ensure that this process is not slowed down due to the server burden. One of the measures that will be used to achieve this is that the IRP will not be required to store e-invoices for more than 24 hours. As a result, an e-invoice can only be cancelled on the IRP within 24 hours.

Furthermore, the entire invoice must be cancelled because partial cancellation is impossible. Therefore, changes to an e-invoice cannot be made on the IRP.

What is GST portal amendment and cancellation?

While cancellation on IRP is only permitted within 24 hours, Amendment and cancellation of e-invoices are allowed on the GST portal by GST law. This implies that amendments and cancellation of e-invoicing in GST will continue to be made while reporting in Form GSTR-1.

cancellation of e-invoice in GST

In which cases cancellation of e-Invoice in GST done

Cancel your e-invoice

In all cases where an e-invoice must be modified, the only option is to cancel the IRN generated with incorrect information. Simply put, you must cancel the e-invoice in GST that was generated with incorrect information.

Then,  create a new invoice with the correct information and upload it to generate a new IRN. Remember, you cannot use the same invoice number; it must be a new number, and cancellation is permitted 24 hours from when the IRN is generated.

Debit and credit notes

After the time limit for cancelling an e-invoice has passed, you must use the debit or credit note to nullify the invoice information. Next, create a new invoice and a new IRN.

How to Adjust Credit Note In GSTR 3B Filing

GST Portal Modification

The IRP cannot be modified, but necessary changes to the invoice details reported on the IRP can be made via the GST portal when filing GSTR-1. Because the IRP systems are linked to the GST system, as soon as an e-invoice is generated, the invoice details are auto-populated in GSTR-1, which can be modified.

The options listed above can be used to modify the e-invoice. In addition, you can modify the e-invoice details using any options depending on the nature of the modification and the situation.

Cancellation of e-Invoice in GST and Amendment update

important updates in IRP

E-invoice amendment or cancellation must be reported to the IRN within 24 hours, as the IRN portal will not be able to cancel or amend the invoice after that time, as it is an e-invoice cancellation time limit.

However, after these 24 hours, the cancellation can be made manually on the GST portal before filing the returns. Next, we'll learn how to cancel an invoice after 24 hours and whether an invoice can be amended in the GST portal.

  • When an IRN is cancelled, the same invoice number cannot be used to generate another IRN. If it is used again, the IRP will reject the invoice when it is reported. This is because IRN is a unique reference number for invoices generated based on the GSTIN, document/invoice number, type of document, and the financial year it was issued.
  • If an e-way bill for an IRN has been generated, the IRP will not allow the cancellation of the IRN.
  • If an IRN is cancelled, the GSTR-1 will be automatically updated with the 'cancelled' status.
  • Taxpayers must do so manually if an invoice must be cancelled after 24 hours on the GST portal before filing their GST returns.
  • According to GST law, only changes to the e-Invoice can be made through the GST portal.

Article need to focus:

e-Invoice Generation & IRP Portal User Management Guide

e-Invoicing under GST: Auto-population into GSTR-1

Conclusion

With the exception that e-invoices can be cancelled on the IRP within 24 hours, the scope for Amendment and cancellation of e-invoice in GST has not changed since the introduction of the e-invoicing system.

E-Invoicing and GST Returns Filing Made Simple with GSTHero

Without a doubt, there are some challenges to overcome to implement the e-Invoicing system fully.

These obstacles, however, are not too difficult to overcome.

A proper strategy, feasible IT infrastructure, and coordination between the taxpayer and the IRP portal can assist you in generating e-Invoices smoothly.

Businesses should try to automate their GST Returns filing process as much as possible.

This allows them to remain compliant with the ever-changing GST laws while protecting their working capital.

GSTHero can help you with every step of the GST Returns filing process, including e-Invoice generation, e-Way Bill generation, and Digital Signing.

Request a free demo now, and an expert will contact you shortly!

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e-Way Bill Generation: Integration With e-Invoicing & The Effects of the Changes


Sameep Mohite

About the author

Sameep Mohite is a computer engineer with a passion for GST. He has written many articles on GST, Finance, and Technology topics.

He is a GST expert who writes for GSTHero. He wants to ensure you know what you're paying for and why.

He enjoys explaining complex technical terms in primary, easy-to-understand language.

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