E-Way Bill Under GST In Karnataka
An e-way bill is a document that transporters need to carry when moving goods worth more than ₹50,000. For interstate transport, the e-way bill system was launched in India on April 1, 2018, while for intra-state transport it was launched on April 15, 2018, once the systems were stabilised.
Karnataka was part of the first phase of GST and E-Way Bill implementation across India. In this article, we will discuss the current e-way bill rules in Karnataka, as well as the system that existed before the implementation of GST and e-way bills.
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The System Before GST and E-Way Bills Were Introduced in Karnataka
Before the introduction of GST, Karnataka had a system called “e-Sugam” to keep track of the movement of goods. This system required sellers or dealers to generate an online transit document if the value of the goods being transported was above INR 20,000, whether the goods were being moved within or outside of Karnataka. To use this system, dealers had to register on a common portal provided by the Karnataka government and create a unique username and password to access the online platform. Once logged in, dealers could generate e-Sugam documents online or even through SMS using their registered mobile numbers. This service was called “m-Governance mobile-based Sugam”.
Each generated e-Sugam document had a unique number, which had to be quoted to the Check Point Officer (CPO) at the check post as a passport. The Officer would verify whether the information in the document matched the goods being transported. If no discrepancy was found, then the transport was approved. Otherwise, the officer had to record the discrepancy in the system and take appropriate legal action.
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For certain notified goods that were being transported out of Karnataka, the system of C-Form existed alongside e-Sugam.
Brief about ‘e-SUGAM’ – Prevalent During VAT Era
e-SUGAM was an online system used during the VAT era in Karnataka to report the movement of goods within and outside the state. Businesses transporting goods over a specified value or quantity had to upload details of the consignment to the e-SUGAM portal before transportation. A unique acknowledgment number was generated, which transporters carried along with the goods. This system helped the government monitor tax compliance and curb tax evasion. However, it was state-specific and had limited applicability compared to the current GST-based E-way Bill system, which applies nationwide for seamless goods transportation.
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Are C-Forms Still Required for Goods Moving Out of the State?
No, C-Forms are no longer required under the GST regime. C-Forms were used in the VAT and CST era to claim reduced tax rates for interstate transactions. With GST replacing VAT and CST, interstate transactions are taxed uniformly at the applicable GST rate, and input tax credit (ITC) is available. This eliminates the need for C-Forms. However, businesses must ensure they comply with GST regulations, including generating E-way Bills for the interstate movement of goods if the value exceeds the prescribed threshold.
Does the Movement of Goods Within, In, and Out of Karnataka Need E-Way Bill Today?
Yes, E-way Bills are mandatory in Karnataka for transporting goods valued above ₹50,000, whether moving within the state, into, or out of the state. The E-way Bill must be generated on the GST portal, providing details of the goods, consigner, consignee, and vehicle. Certain goods, like precious metals, have lower value thresholds for mandatory E-way Bills. However, exemptions apply in specific cases, such as transporting goods through non-motorized conveyance or when the goods fall under exempted categories. Karnataka follows the standard GST E-way Bill rules applicable nationwide.
Cases When E-Way Bills Are Not Required
E-way Bills are not required in the following cases:
- Goods transported for personal use without consideration.
- Goods moved by non-motorized conveyance like bicycles or handcarts.
- Exempted goods under GST include fresh fruits, vegetables, and milk.
- Transported distance is less than 50 km for intra-state movement between consignor and transporter.
- Goods transported under customs bond or sealed containers.
- Transit cargo to or from Nepal or Bhutan.
- These exemptions reduce the compliance burden for specific scenarios while maintaining overall GST guidelines.
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Transitioning to E-Way Bill System in Karnataka
When GST was implemented on 1st July 2018, it subsumed all the indirect taxes that existed under the previous tax regime, like VAT, Excise Duty etc. This allowed for standardisation of taxes across the country, as now the entire country paid only a single tax. To take it one step further, the e-way bill system was introduced, but it was only implemented on 1st April, 2018, as it had to go through many changes and revisions before it was ready to be used.
In the meantime, changes were made regarding the C Form. With the introduction of GST, the Central Sales Tax (CST) of 2% was subsumed by GST, but it still applies to certain non-GST goods. The goods mentioned below fall in this category, and the C Form is still required for these goods:
- High-speed diesel
- Petroleum crude
- Natural gas
- Motor spirit (also known as petrol)
- Alcoholic liquor for human consumption
- Aviation turbine fuel
It’s important to note that the C Form is only needed if these goods are used for resale, manufacturing, processing, telecommunications network, mining, electricity generation or distribution, or any other power-related purposes.
How to Sign Up and Start Producing E-Way Bills?
Users need to register on the e-way bill portal before they can start generating e-way bills.
Thereafter, you can follow our step-by-step guide to generate e-way bills on the GST Portal.To generate e-way bills quickly and easily without going to the GST Portal, try BUSY E-Way Bill Software. You only need to set it up once, and then you can generate single as well as multiple e-way bills automatically, with just one click. It is by far the most convenient way to generate e-way bills without disrupting your workflow.
Who should Produce E-way bills and When?
Only when the value of the consignment exceeds Rs. 50,000 must the person in charge of the vehicle carrying the shipment of goods carry an e-way bill.
When calculating the value of the shipment, the following factors should be taken into account-
When a bill is produced for both a taxable and an exempt supply, it includes the IGST or the CGST and SGST, depending on the situation, but excludes the value of the exempt supply of goods transported. An e-way bill, which must be carried by the person in charge of the consignment of goods for delivery to the buyer’s location and be in either physical or electronic form, must be created by the seller before transferring items.
Other situations when e-way bills must be generated include the following:
When purchasing goods from an unregistered seller—the transporters—and having them transported by road in a vehicle with multiple orders, even when each order or invoice is less than Rs. 50,000, the recipient, buyer, or consignee, depending on the situation, must produce an e-way bill. First, e-way bills (EWB-01) must be created against individual Invoices, and then a consolidated e-way bill (EWB-02) must be designed for the consignment.
Various techniques for producing E-way bills
The e-way bill portal allows users to generate e-way bills online. If you don’t have internet access, or need to quickly generate only one e-way bill, you can use SMS to generate and manage e-way bills as well. Users of Karnataka’s e-way bill must text the code to the cellphone number 97319 79899.
But the easiest and fastest way to generate single as well as bulk e-way bills is through using an e-way bill software like BUSY, so you can save time and effort by generating the e-way bills automatically without going to the GST Portal.
I am a chartered accountant with over 14 years of experience. I understand income tax, GST, and balancing financial records. I analyze financial statements and tax codes effectively. However, I also have a passion for writing, which is different from working with numbers. Recently, I started writing articles and blog posts. My goal is to make finance easier for everyday people to understand.
Frequently Asked Questions
- Is the E-Way Bill mandatory in Karnataka?Yes, the E-Way Bill is mandatory in Karnataka for transporting goods valued above the specified limit. It applies to all inter-state and intra-state movements of goods, ensuring compliance with GST laws.
- What is the minimum value of goods for which an E-Way Bill is required in Karnataka?An E-Way Bill is required for goods worth ₹50,000 or more in Karnataka. However, certain exceptions apply, such as for exempted goods or special cases notified by the government.
- What are the documents required to generate an E-Way Bill in Karnataka?The required documents include an invoice or bill of supply, transporter ID or vehicle number, and relevant GST registration details. These ensure proper tracking of goods during transit.
- What is the validity period of an E-Way Bill in Karnataka?The E-Way Bill is valid for one day for every 200 kilometers of travel for regular vehicles. The validity depends on the distance covered and the type of transport used.
- Are there exemptions from generating an E-Way Bill in Karnataka?Yes, exemptions exist for goods like agricultural produce, newspapers, and goods transported by non-motorized vehicles. Specific cases notified by the government also qualify for exemptions.
- What are the penalties for non-compliance with E-Way Bill rules in Karnataka?Non-compliance can lead to penalties, including a fine of ₹10,000 or the value of the tax evaded, whichever is higher. Goods and vehicles may also be detained.
- What is the process for extending an E-Way Bill in Karnataka?To extend an E-Way Bill, update the details on the GST portal before expiry. Provide reasons for extension and expected travel time, ensuring uninterrupted compliance.
- What are the technological options for generating an E-Way Bill in Karnataka?E-Way Bills can be generated through the GST portal, mobile apps, SMS, or APIs provided by GST Suvidha Providers. These options offer flexibility and ease of use.
