Consultant Bill

[Asked by Guest]

Dear Sir,

We hired a person as a consultant, We paid to him fixed amount on monthly basis. Recently he has submitted a bill in letter format, Not proper invoice format. Also he has mentioned, his FY 2016-17 income below 10Lacs.

My question is below.

Why required proper invoice for bill passing/payment ??

Please explain.

Thanks & Regards,

Sanjay Vasava

AI Summary

Service invoice requirements: proper invoices required; advocate services exempt and recipient pays tax under reverse charge.
A consultant's letter-format bill without prescribed particulars does not qualify as a proper invoice. Under Rule 4A, invoices must state provider and recipient details, nature of service, amounts, tax, invoice date/number, registration number, and be signed, stamped and dated. Advocates are generally exempt and, where the reverse charge mechanism applies, the recipient pays tax via challan and may claim CENVAT credit; non-exempt consultants must comply with invoicing rules.