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GST E- WAY BILL

India has just announced the launch of another major reform under the GST regime. The government has  successfully rolled out the E-way bill system for tracking goods movement under the Goods and Services Tax (GST) from April 1, 2018.

Way bill is not a new phenomenon. It was prevalent in most states under the erstwhile VAT regime in the name of road permit, way bill, etc. It was used to monitor movement of goods to/ from a state in order to check tax evasion. A way bill is typically required to accompany goods on their movement from consignor to consignee.

Earlier, way bills were subject to state-specific rules and had to be generated through different state-specific portals.

Under GST, E-way bill is governed by a uniform set of rules applicable throughout the country. It is generated electronically on the e-way bill portal.

The e-way bill system creates a facility for transporters to raise complaints, in case a vehicle is detained for more than 30 minutes. However, some features of the new E-way bill vis-à-vis VAT way bill such as mentioning HSN on the E-way bill, limited validity etc. are not welcomed by businesses.

• The government, while proposing the idea of incorporating E-way bill under GST, had the intention of creating an effective tool for tracking movement of goods and ensure various benefits to the industry.
  

  The steps included:

• Abolition of check-posts
• Seamless movement of goods within a state and across different state borders
•  Boost to India’s logistics ecosystem resulting in lesser traffic on major transportation routes
• Reduction in transportation costs and lead time by replacing physical check posts with mobile squads.

For every shipment of goods of the value of more than Rs.50,000/- whether interstate or intra state an e way bill must be generated through an online portal, before the goods are shipped and it should include specified details of goods, their consignors, recipients and transporters.

An effective and user friendly e-way bill system has the potential to suppress black marketing and check tax evasion. With a daily capacity of 75 lakh e way bills on the portal, the lead time for businesses should come down.

However, e- way bills have already started generating litigation.

Allahabad High Court recently held seizure of goods by tax authorities untenable just because details of transport company and vehicles were hand written after downloading the e way bill. Kerala High Court also held that mere procedural infractions should not lead to detention by tax authorities.

SALIENT FEATURES OF THE SYSTEM

• • The consignor or consignee, as a registered person or a transporter of the goods, can generate the e- way bill. The unregistered transporter can enrol on the common portal and generate the E-Way bill for movement of goods for his clients, according to the Central Board of Excise and Customs (CBIC).

• The prerequisite for generation of the e-way bill is that the person who generates the E-Way bill should be a registered person on the GST portal and should register on the E-Way bill portal, according to CBIC’s website –  cbic.gov.in.
• The documents such as tax invoice or bill of sale or delivery challan and the transporter’s ID must be available with the person who is generating the e way bill.
• The e-way bill is required to transport all the goods except exempted under the notifications or rules. The movement of handicraft goods or goods for job-work purposes under specified circumstances also requires E-Way bill even if the value of consignment is less than Rs. 50,000.
• The validity of the e-way bill depends upon the distance that the goods which have to be transported across the states, will cover.
• The validity period of the e-Way bill is calculated based on the ‘approximate distance’ entered while generating the e-Way bill. For every 100 kilometres, a validity period of one day is calculated as per rules.
• Once generated-way bill cannot be edited or modified. Only Part-B can be updated. However, if e-way bill is generated with wrong information, it can be cancelled and generated afresh.
• Any person can verify the authenticity or the correctness of the e-way bill by entering EWB No, EWB Date, Generator ID and Doc No in the search option on the EWB Portal.
• If multiple invoices are issued by the supplier to recipient, that is, for movement of goods of more than one invoice of same consignor and consignee, multiple EWBs have to be generated. That is, for each invoice, one EWB has to be generated, irrespective of the fact whether same or different consignors or consignees are involved.
• If validity of the E-Way bill expires, the goods are not supposed to be moved. However, one can extend the validity of the E-Way bill if the consignment is not reaching the destination within the validity period due to exceptional circumstances such as natural calamity, law and order issues, trans-shipment delay, accident of conveyance, etc.

E- way Bill Exempted Goods List