What happens when your business fails to generate an e-invoice?

When the Government of India first implemented e-invoicing in October 2020, they were very lenient towards businesses that were not prepared to adopt e-invoicing.

They even issued extensions in timelines to help companies adapt and integrate e-invoicing in their systems.

These extensions were an issue because adopting an e-invoicing system takes time. It needs organizations to upgrade their systems, adopt suitable technology, integrate technology suites, and train their staff on e-invoicing authentication.

However, once the extension period was over, the Government enforced that businesses who did not adhere would face the applicable penalties.

So, what happens if your business cannot adhere to e-invoicing?

As per sub-rules 4, 5, and 6 of rule 48 of GST laws, firms (eligible to adopt e-invoicing) need to report all their B2B transactions to the invoice registration portal.

Therefore, any invoice that the invoice registration portal has not authenticated will be considered invalid. Additionally, companies won’t be able to claim ITC while filing GST returns.

This can also attract penalties. For example, an organization that fails to adhere to GST laws and does not authenticate a…