Can an e-invoice be cancelled partially/fully?

The e-invoice system in India is a government initiative aimed at digitizing the invoicing process for businesses in the country. It was introduced in 2020 as part of the Goods and Services Tax (GST) reforms and is mandatory for companies with an annual turnover of over Rs. 10 crores. Under the GST e-invoice system, businesses are required to generate invoices using a standardized format that is recognized by the GST Network (GSTN). The invoices are then uploaded to the GSTN portal, where they are validated and assigned a unique Invoice Reference Number (IRN) and a QR code. Click here to learn about e-invoice in detail.

What is the mechanism of e-invoice in India?

The e-invoicing technology enhances controls against tax evasion while also automating and simplifying the process of submitting returns. An electronic invoice is prepared according to a set format. Each one is given a distinct Invoice Reference Number (IRN) using a hash-generating mechanism. The period for e-invoice cancellation and alteration is 24 hours. When a customer cancels an order or enters an e-invoice incorrectly or twice, the method to cancel the e-invoice is straightforward and convenient.

Can an e-invoice be cancelled partially/fully?

No. E-Invoices cannot be cancelled partially. They must be fully cancelled.

What is the cancellation period for e-invoice?

The e-invoice method makes it possible to cancel invoices. According to the requirements of GST law, revision and cancellation of e-invoices are permitted on the GST portal, but cancellation on the IRP is only permitted within 24 hours. IRN must receive a report of this within 24 hours. On IRN, cancellations made beyond 24 hours may not be possible; however, manual cancellations of the same are available on the GST portal prior to submitting returns. Additionally, the e-invoice cannot be modified in any way. While submitting GSTR-1, the only way to make changes to the invoice details that have been posted to the IRP is through the GST site. Nonetheless, the appropriate officer will be informed of these changes and may ask the taxpayer for more details.

In which case can e-invoice be cancelled?

The following three situations allow for e-invoice cancellation-

Order cancellation by the buyer
Incorrect entry
Duplicate entry

The step-by-step process for cancellation of e-invoice-

A taxpayer must follow the below-mentioned steps in order to cancel an e-Invoice on the IRP: Step 1: Log in to the e-Invoice portal and choose "e-Invoice". Click on "Cancel". Step 2: On the next page, choose "Ack No." or "IRN," if appropriate, and type the "Ack No." or "IRN" number. Click "Go" to continue. Step 3: The system will show the electronic invoice and prompt the user to choose the cancellation reason. Click "Submit" to reverse the e-Invoice. The invoice has been effectively cancelled, according to the portal. A "Cancelled" marking will be visible on the cancelled e-Invoice. IndiaFilings can assist you in generating e-invoices easily and quickly.

GST Registration

GST LUT Form

Can an e-invoice be cancelled partially/fully?

What is the mechanism of e-invoice in India?