Banks & Insurance Cos to issue Consolidated Monthly Invoice: GST Council Amends Rules

Banks and Insurance Companies need to issue consolidated monthly invoices after the GST Network crashed at peak filing time last month.

The Goods and Services Tax (GST) Council has approved rule changes in this regard.

This was caused by overloading due to returns being filed with separate invoices for each transaction, vastly exceeding the network's capacity.

"Banks and insurance companies have several transactions with the same client... These can be reflected in a single invoice like it has been done until now," said a government official aware of the development.

In the earlier service tax regime, some sectors were allowed to report transactions in a single invoice every one and half months.

GSTN had discussed the issue with banks and insurers prior to the rollout of GST on July 1. Banks were amenable to the idea, but sought legal comfort under the new tax framework.

Since the GSTN has been designed with the capacity to handle up to 50,000 invoices per second, this meant all other users were denied access. Though the system was rectified soon after, a permanent solution was needed to prevent a reoccurrence.

The council has extended the deadline for filing returns for July and August to help businesses get familiar with the system. Businesses were classified into two categories — below Rs 100 crore and over Rs 100 crore — and allowed those below the threshold to file returns in the first 10 days and the rest after that.