Guide to E-way Bill Under GST

What is an E-Way Bill?

The E-Way Bill, also known as the Electronic Way Bill, is a digital document generated on the Portal for the movement of goods. It is mandatory for a GST registered person to obtain an e-way bill when transporting goods in a vehicle with a value exceeding Rs. 50,000 (for a single invoice, bill, or delivery challan).

It can be generated or cancelled through various methods, including the E-Way Bill Portal, SMS, Android App, or site-to-site integration using API. It is important to enter the correct GSTIN (Goods and Services Tax Identification Number) of the parties involved and validate the GSTIN using the GST search tool before using it for generating the e-way bill.

Once the bill is generated, it is assigned a unique E-way Bill Number (EBN), which is accessible to the supplier, recipient, and transporter of the goods. The EBN serves as a reference for tracking and monitoring the movement of goods during transportation.

When is an E-way Bill Issued?

It is required to be generated when goods are being transported in a vehicle or conveyance with a value exceeding Rs. 50,000. This threshold can be reached either for each individual invoice or as an aggregate value of all the invoices in the vehicle or conveyance.

• In connection with a ‘supply’ transaction
• For reasons unrelated to a ‘supply’ transaction (such as a return)
• As a result of receiving an inward ‘supply’ from an unregistered person

For this purpose, a supply can be classified into the following categories:

• A supply made in the course of business in exchange for a consideration (payment).
• A supply made in exchange for a consideration (payment), which may or may not be in the course of business.
• A supply without consideration (without payment). In simpler terms, the term ‘supply’ typically refers to sale of goods and payment made, branch transfers for instance, and where the payment is by goods instead of in money.

In order to facilitate these types of movements, it is mandatory to generate E-way Bills on the common portal. Furthermore, for certain specified goods, the eWay bill must be generated regardless of the consignment value being below Rs. 50,000:

• The inter-state movement of goods from the Principal to the Job-worker can be facilitated by either the Principal or a registered Job-worker.
• A dealer who is exempted from GST registration can engage in the inter-state transport of handicraft goods.

Who Needs to Generate an E-way Bill?

Given below is who needs to generate an E-way Bill according to the rules and regulations of Goods and Services Tax in India:

• Registered Person: It must be generated when there is a movement of goods valued at more than Rs 50,000 to or from a registered person. However, it is optional for both the registered person and the transporter to generate and carry the bill even if the value of goods is less than Rs 50,000.
• Unregistered Persons:Unregistered persons are also obligated to generate e-Way Bills. However, in cases where an unregistered person supplies goods to a registered person, the recipient (registered person) assumes the responsibility of complying with all the necessary requirements as if they were the supplier.
• Transporters:Transporters who are responsible for carrying goods via road, air, rail, etc. are also required to generate the bill if the supplier has not already generated one. In such cases, it becomes the responsibility of the transporter to generate the bill for the goods being transported.

Cases Not Requiring E-way Bill

Given below are some of the cases where it is not mandatory to generate E-way Bill:

• If the mode of transport for goods is a non-motor vehicle, such as a bicycle or handcart.
• When goods are transported from a Customs port, airport, air cargo complex, or land customs station to an Inland Container Depot (ICD) or Container Freight Station (CFS) for Customs clearance.
• For goods that are transported under Customs supervision or under a customs seal, there is no requirement to generate an e-Way Bill.
• When goods are transported under a Customs Bond from an Inland Container Depot (ICD) to a Customs port or from one customs station to another.
• Transit cargo being transported to or from Nepal or Bhutan is exempt from the requirement of generating an e-Way Bill.
• The movement of goods caused by a defence formation under the Ministry of Defense, either as a consignor or consignee, is exempt from the requirement of generating an e-Way Bill.
• The transportation of empty cargo containers does not require the generation of an e-Way Bill.
• When a consignor is transporting goods to or from their place of business to a weighbridge for weighment within a distance of 20 kilometres, and is accompanied by a Delivery Challan.
• When goods are being transported by rail and the Consignor of the goods is either the Central Government, State Governments, or a local authority, there is no need to generate the Bill.
• Goods that are specifically exempted from the requirement of generating an e-Way Bill as per the State/Union Territory GST Rules are not subject to the bill requirements.
• The transport of certain specified goods, which includes goods exempt from supply, goods listed in Annexure to Rule 138(14), goods treated as non-supply according to Schedule III, and goods specified in certain Central tax rate notifications.

Please note that if the distance between the consigner or consignee and the transporter is less than 50 kilometres, and the transportation is within the same state, Part B of the Bill is not required to be filled.

State-wise Rules and Limits

Since its implementation on April 1, 2018, the inter-state movement of goods has witnessed a significant increase in the generation of e-Way Bills. The bill system has been successfully implemented across all states and union territories, with positive responses from businesses.

However, certain states have provided reliefs to their residents by exempting them from generating bills for certain specified items or if the transaction value falls below a threshold amount. For example, Tamil Nadu exempts the generation of bills for items below Rs. One Lakh. To learn more about such reliefs in different states and union territories, you can visit our page on state-wise rules and threshold limits or refer to the respective commercial tax websites of each state or union territory.

Documents Required to Generate E-way Bill

• The invoice, bill of supply, or delivery challan related to the consignment of goods is an essential document required to generate an e-Way Bill. It should contain all the necessary details of the goods being transported, including the description, quantity, value, tax rates, and other relevant information. This document serves as a basis for generating the bill and ensures accurate information about the goods being transported.
• Transport by road – Transporter ID or Vehicle number
• Transport by rail, air, or ship – Transporter ID, Transport document number, and date on the document

What Are the Penalties Associated With the E-way Bill

In the realm of modern logistics and Goods and Services Tax (GST), the electronic waybill, or e-way bill, plays a vital role in ensuring the seamless movement of goods. Compliance with e-way bill regulations is crucial to avoid penalties that could impact business operations. Here are the penalties, providing businesses with essential insights to navigate this aspect of goods transportation and GST compliance.

Understanding E-Way Bill Penalties

Penalties related to e-way bills are designed to enforce adherence to regulations and promote compliance. Violations or non-compliance with rules can result in penalties that range from monetary fines to confiscation of goods.

Types of E-Way Bill Penalties

Several types of penalties can be levied for various e-way bill-related violations. Here are some common scenarios and their associated penalties:

• E-Way Bill Not Generated: If it is not generated for the movement of goods that require it, a penalty equal to the tax amount on the goods being transported or Rs. 10,000 (whichever is higher) may be levied.
• E-Way Bill Not Updated: If the transporter does not update the Part-B details of the e-way bill, a penalty of Rs. 10,000 or the tax amount on the goods (whichever is higher) can be imposed.
• Detention or Confiscation: In cases of non-compliance or discrepancies, authorities have the power to detain or even confiscate the goods until the applicable penalty is paid.
• Incorrect Information: Providing incorrect details in the bill could result in a penalty equal to 10% of the value of goods or Rs. 10,000 (whichever is higher).

Minimising E-Way Bill Penalties

To avoid e-way bill penalties, businesses can adopt the following strategies:

• Thorough Documentation: Ensure accurate and complete documentation when generating e-way bills, including details about the consignment, parties involved, and transportation.
• Timely Generation: Always generate an e-way bill when required and ensure that it is valid for the entire journey.
• Regular Updates: Transporters should promptly update Part-B details of the e-way bill to reflect the actual movement of goods.
• Proactive Compliance: Stay informed about the rules, guidelines, and updates to ensure timely compliance and avoid penalties.

Penalties associated with e-way bills underscore the importance of compliance in the modern logistics and GST landscape. By understanding the types of penalties, adhering to rules, and maintaining accurate documentation, businesses can ensure the seamless movement of goods while avoiding unnecessary financial setbacks. As the GST framework continues to evolve and logistics practices advance, a proactive approach to e-way bill compliance remains integral to efficient goods transportation and successful GST management.