What it means
If what you sell is exempt from GST, or you are in the composition scheme, you cannot issue a tax invoice, because no tax is being charged. Rule 49 asks for a bill of supply instead. It shows: your name, address and GSTIN; a serial number of up to 16 characters, unique for the year; the date; the buyer’s name, address and GSTIN if registered; HSN or SAC; description; value after discount; and a signature. A composition dealer also prints a line saying it is a composition taxable person not eligible to collect tax.
Example
A Mysuru vegetable wholesaler sells fresh tomatoes, which are exempt, worth ₹12,000 to a hotel.
| Line | Amount |
|---|---|
| Tomatoes, 400 kg at ₹30 | ₹12,000 |
| GST | nil |
| Total | ₹12,000 |
The document is titled “Bill of supply”, not “Tax invoice”. If the same trader also sells packed goods that are taxable, those go on a tax invoice.
Common mistakes
- Printing “Tax invoice” with a GST column showing zero.
- A composition dealer adding GST to the bill.
- Not reporting exempt sales in GSTR-1 and GSTR-3B; they still go in the nil-rated and exempt tables.
In MyRecords
When a sale carries no tax, the POS receipt prints as a bill of supply rather than a tax invoice. A sales invoice prints as the GST tax invoice; a bill-of-supply layout for it is not built yet. Exempt and nil-rated sales go into the nil table of the GSTR-1 file and table 3.1 of GSTR-3B.