GST: CBIC issues clarification on Applicability of Dynamic QR Code on B2C Invoices [Read Circular]

The Central Board of Indirect Taxes and Customs (CBIC) issued the clarification on the applicability of the Dynamic Quick Response (QR) Code on B2C invoices.

The Board has issued the Notification No. 14/2020-Central Tax, dated 21st March 2020 which requires Dynamic QR Code on B2C invoice issued by taxpayers having aggregate turnover more than 500 crore rupees, w.e.f. 01.12.2020.

Further, vide notification No. 06/2021-Central Tax, dated 30th March 2021, the penalty has been waived for non-compliance with the provisions of notification No.14/2020 – Central Tax for the period from 01st December 2020 to 30th June 2021, subject to the condition that the said person complies with the provisions of the said notification from 1st July 2021. Further, various issues on the Dynamic QR Code have been clarified vide Circular No. 146/2/2021-GST, dated 23.02.2021.

The CBIC said in the circular, “Various references have been received from trade and industry seeking clarification on applicability of Dynamic Quick Response (QR) Code on B2C (Registered person to Customer) invoices and compliance of notification 14/2020-Central Tax, dated 21st March 2020 as amended. The issues have been examined and in order to ensure uniformity in the implementation of the provisions of the law across the field formations, the Board, in the exercise of its powers conferred under section 168(1) of the CGST Act, 2017, clarified the issues”.

The Board has clarified that any person, who has obtained a Unique Identity Number (UIN) as per the provisions of Sub-Section 9 of Section 25 of CGST Act 2017, is not a “registered person” as per the definition of the registered person provided in section 2(94) of the CGST Act 2017. Therefore, any invoice, issued to such a person having a UIN, shall be considered as an invoice issued for a B2C supply and shall be required to comply with the requirement of the Dynamic QR Code.

Given that UPI ID is linked to a specific bank account of the payee/ person collecting money, separate details of bank account and IFSC may not be provided in the Dynamic QR Code.

In cases where the payment is collected by some person, authorized by the supplier on his/ her behalf, the UPI ID of such person may be provided in the Dynamic QR Code, instead of the UPI ID of the supplier.

The Board said that wherever an invoice is issued to a recipient located outside India, for the supply of services, for which the place of supply is in India, as per the provisions of IGST Act 2017, and the payment is received by the supplier in foreign currency, through RBI approved mediums, such invoice may be issued without having a Dynamic QR Code, as such dynamic QR code cannot be used by the recipient located outside India for making payment to the supplier.

In cases, where the invoice number is not available at the time of digital display of dynamic QR code in case of over the counter sales and the invoice number and invoices are generated after receipt of payment, the unique order ID/ unique sales reference number, which is uniquely linked to the invoice issued for the said transaction, may be provided in the Dynamic QR Code for digital display, as long as the details of such unique order ID/ sales reference number linkage with the invoice are available on the processing system of the merchant/ supplier and the cross-reference of such payment along with unique order ID/ sales reference number are also provided on the invoice.

The Board has also clarified that the purpose of dynamic QR Codes is to enable the recipient/ customer to scan and pay the amount to be paid to the merchant/ supplier in respect of the said supply. When the part-payment for any supply has already been received from the customer/ recipient, in form of either advance or adjustment through voucher/ discount coupon etc., then the dynamic QR code may provide only the remaining amount payable by the customer/ recipient against “invoice value”. The details of the total invoice value, along with details/ cross-reference of the part- payment/ advance/ adjustment done, and the remaining amount to be paid, should be provided on the invoice.

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