B2B software such as ERP (Enterprise Resource Planning) and CRM (Customer Relationship Management) is commonly purchased in India as:
SaaS subscription (cloud, monthly/annual)
Perpetual/on-prem license (one-time license + AMC)
Hybrid (on-prem core + cloud add-ons)
This article explains:
What ERP/CRM companies operate in India (Indian + global)
How ERP/CRM software companies generally register/operate legally in India
Norms you must follow as a buyer (GST, invoicing, data protection, security)
How to “claim” (primarily GST Input Tax Credit / ITC, and audit-ready documentation)
On what grounds to procure ERP/CRM (business justification + compliance + security)
Note: This is a practical IT + compliance guide (not legal advice). Always confirm with your CA/tax consultant for your exact transaction type and state-specific requirements.
Tally Solutions (TallyPrime, ERP-style accounting & compliance)
Zoho (Zoho One, Zoho CRM, Zoho Books, Zoho People, etc.)
Busy (Busy accounting/ERP for SMEs)
Marg ERP (retail/distribution/pharma ERP)
Focus Softnet, Ramco (ERP suites for multiple industries)
Industry-focused ERPs (manufacturing, pharma, retail, logistics) via Indian vendors/partners
SAP (SAP S/4HANA, SAP Business One)
Oracle (Oracle ERP Cloud, NetSuite)
Microsoft (Dynamics 365)
Salesforce (CRM platform)
HubSpot, Freshworks (Freshsales CRM), Infor, Epicor, Odoo (open-source + partners)
Buyer reality: most global vendors sell via Indian subsidiaries, authorized partners, or registered resellers, so your invoice and GST compliance depends on who invoices you (India GSTIN vs foreign entity).
Sources on GST/ITC and SaaS compliance are referenced below.
Indian Company (Private Limited/LLP/OPC)
Incorporated through MCA (Registrar of Companies) using SPICe+ and related forms.
Indian Subsidiary of a Foreign Company
Indian entity invoices Indian customers with Indian GSTIN.
Foreign Company + Indian Reseller/Partner
Reseller invoices in India (preferred for simpler GST ITC).
Foreign Company Directly Invoicing Indian Customer
Usually treated as import of services (tax/compliance can involve GST reverse charge, and additional tax considerations depending on structure).
PAN/TAN, bank account, statutory registrations
GST registration if liable (for taxable supplies in India)
Contracting: MSA, SLA, DPA (data processing), support terms, audit clause
Data/privacy: obligations under India’s DPDP framework (Digital Personal Data Protection).
Minimum invoice checks (practical):
Supplier legal name matches contract and GST registration
Supplier GSTIN is valid (if invoicing from India)
Invoice contains: invoice number/date, place of supply, taxable value, GST rate/amount
Your company name, address, your GSTIN (if registered) is correct
SAC/HSN classification as applicable for software/services
GST ITC is fundamentally governed by Section 16 conditions and timing/eligibility rules.
In practice, ensure:
You have a valid tax invoice
You received the service
Supplier has filed correctly so the invoice appears in GSTR-2B
You pay the supplier within contractual terms (retain proof)
If ERP/CRM handles personal data (customers, employees, leads):
Sign a DPA / privacy addendum
Define retention, deletion, access controls, breach notification
Identify roles: Data Fiduciary vs Data Processor responsibilities
Ask about consent management support where relevant
(Framework guidance references).
MFA/SSO options, role-based access control, audit logs
Encryption in transit (TLS) and at rest
Backup policy + restore testing
Vulnerability management, incident response, support SLAs
Use these grounds to justify selection and purchase (useful for internal approvals and audits):
Standardizing workflows (sales → order → invoice → collections)
Real-time inventory, production planning, procurement control
Faster closing and accurate MIS/analytics
Reduced manual errors and compliance rework
Segregation of duties (maker-checker)
Audit trails for approvals, pricing, credit limits
Data retention and export for statutory audits
GST-ready invoicing and reporting workflows
E-invoicing/e-way bill integration (if applicable to your turnover and use case)
DPDP-aligned access and retention controls (where personal data exists)
Centralized identity, logging, backups
Reduced spreadsheet/email data leakage risk
Vendor security posture and contractual accountability
Modules: Sales, Purchase, Inventory, Finance, HR, Projects, Helpdesk
Volume: users, branches, GSTINs, warehouses, items, invoices/day
Integrations: Tally, Busy, payment gateways, WhatsApp, e-invoice APIs, e-commerce
Output: Requirements + data fields + integration list.
Create a structured evaluation matrix.
Evaluation areas:
- Fitment (modules, Indian tax workflows)
- Security (MFA/SSO, logs, encryption)
- Compliance (GST, audit trail, DPDP readiness)
- Integrations (APIs, webhooks, connectors)
- Commercials (TCO, renewals, support)
- Exit (data export, deletion SLA)
MSA + SLA (uptime, support response)
Data ownership + export format (CSV/JSON/SQL dump)
Incident/breach notification timeline
Sub-processor disclosure (for SaaS)
Audit rights (at least for logs and access history)
Confirm whether invoice will be raised by:
Indian GSTIN entity (simpler ITC workflow), OR
Foreign entity (import of services — additional compliance may apply)
Ask vendor for a proforma invoice and verify fields match your GST profile
Ensure your purchase is tagged as business use (cost center/project)
Data migration: masters (customers, vendors, items), opening balances
Role design: Admin, Accounts, Sales, Purchase, Store, Approver
Workflows: quotation → order → invoice; PO → GRN → purchase invoice
Reports: GST registers, debtor aging, stock valuation, profitability
Example: Basic migration mapping (CSV → ERP)
Enable MFA for all users
Restrict admin roles
Turn on audit logs and export schedule
Daily backup and monthly restore drill (document results)
Most buyers mean one or both of the following by “claim”:
Claim GST Input Tax Credit (ITC) (for GST-registered businesses)
Maintain audit-ready proof (invoice + contract + usage evidence)
You must be GST registered
Software must be used for business purposes
You must have a valid tax invoice
Invoice should reflect in GSTR-2B for ITC claim (operational requirement linked to Section 16 conditions).
Collect invoice + proof of service activation (email/license key/admin portal screenshot)
Ensure vendor GSTIN and invoice details are correct
Check GSTR-2B: invoice must appear
Post entry in accounting/ERP with correct GST component
Claim ITC in GST return (via your GST workflow / CA process)
Common blocker: invoice not showing in GSTR-2B → usually supplier filing issue.
This can be treated as import of services and may involve reverse charge GST and other tax handling depending on exact facts (entity, contract, place of supply). Use your CA for final treatment. (Up-to-date SaaS GST discussions referenced).
India’s equalisation levy rules have seen changes in recent years; credible reporting indicates the 2% levy was removed in Aug 2024 and the 6% ad levy proposed/removed effective Apr 1, 2025 (policy context).
(Always confirm latest applicability for your transaction type.)
Symptoms: You have invoice, but ITC is missing in 2B.
Fix:
Ask vendor to file/rectify GSTR-1 correctly
Re-check next 2B cycle
Maintain email trail and reconciliation notes
References: 2B/ITC operational guidance and Section 16 linkage.
Fix:
Get credit note + reissue invoice (or corrected invoice as per vendor process)
Do not claim ITC until corrected documents exist
Fix:
Ensure contract clearly states: term, renewal, cancellation, data export, support coverage
Maintain renewal tracker (especially for AMC-style renewals)
Fix:
Role-based training + SOPs
Lock down uncontrolled Excel processes
Weekly MIS review + issue tracker for 4–6 weeks
Enforce MFA for all users; disable shared accounts
Use least privilege roles; separate admin and finance roles
Enable audit logs and keep retention aligned with policy
Encrypt exports; restrict who can export customer/employee data
Vendor risk review: sub-processors, breach history, certifications (if available)
DPDP alignment: documented retention, deletion, access request workflow
Prefer India GSTIN invoicing when possible for smoother ITC workflow
Monthly GSTR-2B reconciliation for all SaaS and digital services
Keep a single “Software Compliance Folder”:
Contract + SLA + DPA
Invoices + payment proofs
Access logs export schedule (or screenshots)
Vendor support tickets for critical changes
Maintain a renewal calendar and cost-center tagging
Define exit plan: data export + deletion confirmation
ERP/CRM procurement in India is not just an IT decision—done correctly it is a control + compliance + security program. The most common success pattern is:
choose a product that fits Indian workflows,
contract for auditability and data protection,
implement with roles/logs/backup discipline, and
run a clean GST ITC process (invoice correctness + GSTR-2B matching + documentation).
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