E-invoice Digital Signature

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E-invoicing is the proposed system where business-to-business (B2B) invoices are digitally prepared in an e-invoicing format and authenticated by the Goods and Services Tax Network (GSTN).  Today, an invoice generated by the seller needs to be prepared and reported to two different systems i.e., GST Portal and e-Way Bill.  The reason why e-invoicing is getting popular is that, with e-invoicing, fields will be pre-populated while filing returns, which avoids discrepancies during data entry and reconciliation.  


Defining DSC 

DSC abbreviated from Digital Signature Certificate.  Digital Signature Certificates are electronic formats of physical or paper certificates.  It also used for proof of identity of an individual for a specific purpose.  Certificates serve as a proof of identity of an individual for a certain purpose. It is legally admissible in a court of law. DSCs are issued by a licensed Certifying Authority (CA)granted license under Section 24 of the Indian IT-Act 2000.  

Requirement and Applicability of Digital signature 

JSON of the invoice has to be uploaded in the IRP to generate e-invoice with the digital signature which is one of the optional parameters.  On validation, the IRP will digitally sign and generate a QR code.  A Supplier should get this QR code, Digital Signature and IRN printed on the physical copy distributed to the recipient. These are not interchangeable and has to be disclosed separately.  

Use of DSC Before e-invoicing system 

As per the rules of CGST, all the invoices are to be physically signed by an authorised representative of the entity.  Still, it becomes mandatory to place the digital signature on it, if it is bound by the Information Technology Act, 2000. 

Use of DSC Under e-invoicing system  

The IRP has to be uploaded with the JSON of the invoice.  And digital signature is also an optional parameter of the JSON.  IRN will be generated and JSON will be digitally signed by the portal. An e-Invoice generated will be forwarded to the GSTN & e-way bill system by the IRP.  A Valid e-Invoice can be used by the seller for his business transactions.  If the digitally signed JSON is meddled with, then the e-invoice would become invalid and the digital signature would stand cancelled. 

The provisions of Rule 46 of the Central Goods and Services (CGST) Rules, 2017 apply here. According to Rule 46, the signature/digital signature of the supplier or his authorised representative is required while issuing invoices. However, a proviso to Rule 46 states that the signature/digital signature shall not be required in the case of issuance of an electronic invoice that is in accordance with the provisions of the Information Technology Act, 2000. 

Hence, it has been interpreted that in the case of e-invoices, a supplier will not be required to sign/digitally sign the document. 

What is a digitally signed e-invoice? 

Digitally signed e-invoice is nothing but the invoice authenticated by the IRP with a digital/electronic signature.  This can be clarified as that it is a kind of Government authentication on the genuineness of the invoice details submitted/registered by the taxpayer. 

How to attach DSC to e-invoice? 

Make sure that the software required for scanning the DSC is available and also the ‘emSigner’ tool provided by the GST portal is installed and running in the system. 

Step 1: There are certain different ways of generating an invoice in the specified JSON format. Some of them are: 

  1.  Offline utilities 

  1.  Mobile apps 

  1. Online websites etc. 

 After doing so, we have to log in to the IRP and attach the JSON. 

Step 2: By clicking on the button “Verify using DSC”, a dialogue box will appear on the screen which will show the available digital signatures. 

Step 3: Then, we can select the appropriate Digital Signature and click on “Sign”. Also, verify whether the DSC belongs to the Authorised Signatory as registered on the GST portal. Give in the DSC password when the utility prompt us to type it. 

Step 4: A Success message will appear on the screen, indicating the successful attachment of the DSC. Press OK/proceed to digitally affix the sign. 

Author : Adithi

Date     : 24-Jun-2022