What do we understand by an e-way bill?
E-way bill for the electronic e-way bill is a compliance mechanism that controls the movement of goods. With the help of a digital interface the person who initiates the movement of the goods generates an e-way bill on the GST portal by uploading the relevant information. The generation of e way bills is done before the commencement of the movement of the goods.
What is an E-way bill number (EBN)?
When a person generates an e-way bill the portal gives a unique E-way Bill Number or EBN allocated to him which is readily available with the supplier, transporter and recipient.
The relevance of E-Way Bill
The Goods and Service Tax (GST) is a new law and several complications are in its way. The introduction of the e-way Bill mechanism was made to ensure that the movement of goods can be done without any hassle throughout the country. It acts as an effective tool to track the movement of goods which reduces dummy invoices, controlling tax evasion in the country.
Applicability of e-way bill
The e-way bill system is applicable for both interstate and intrastate transport or supply of goods. In the case of Intra State movement of goods, it can be deferred by the respective state as per GST rules.
The applicability of this system specifies as follows: For supply, a movement of goods in a vehicle or conveyance having a value of more than ₹ 50000 requires the person to generate an e-way bill.
For the purpose of the e-way Bill mechanism the definition of supply as per the CGST Act 2017 includes
- All forms of supply of goods or services or both such as sale, barter, exchange, transfer, rental, lease, licence or disposal,
- Made for consideration in course of business, or
- Made for consideration, not in the course or furtherance of business, or
- Made without any consideration.
Also Read: GST Explained for Everyone
When and who is required to generate an e way bill?
According to CGST rules,
- Every registered person introduces the movement of goods of consignment of value exceeding 50000 rupees (e way bill limits are different for each state in case of intra-state supply),
- In case of supply, or
- delivery of goods other than supply (rule 55 challan) or
- received goods from an unregistered person.
- E-commerce Operator or Courier Agency- A registered person who is liable to generate an e-way bill can authorise an E-Commerce operator or courier agency or transporter to furnish the details and generate an e-way bill.
- Regardless of the consignment value if goods are sent by the principal to the job worker located in another state, the registered principal or the job worker shall generate an e-way bill.
- In the case of handicraft, goods conveyed from one state or union territory to another state or union territory by a person who is not required to register under GST shall generate an e-way bill irrespective of the consignment value.
- Voluntary generation of the e-way bill can be done even if the consignment value is less than 50000 rupees.
Structure of an e-way bill
E-way bill has been bifurcated into two parts namely, Part A and Part B and the details are furnished in FORM GSTEWB-01:
- Part A requires the information of the GSTIN of the supplier and recipient, place of dispatch and delivery, document number, document date, the value of the goods, HSN code and reason for transportation.
- Part B requires a vehicle number for road transport (not for rail and or air or vessels) & document numbers like temporary vehicle registration number or defence vehicle number.
- Part A of the form is filled to an e-way bill by every registered person under GST. Part B of the form is filled by the recipient of the goods or the consignor or the consignee.
- In the case of an unregistered person, the recipient shall generate an e-way bill and complete the rules as if he is the supplier.
Consolidated e-way bill
Form GSTEWB-02 is used to produce a consolidated e-way bill when the transporter is transporting multiple consignments using a single conveyance or vehicle. Prerequisite of generating a consolidated e-way bill that the transporter must have all the individual e-way bills of the goods. The consolidated one can be generated by providing the e-way bill numbers of each consignment.
Documents required to generate an e-way bill
- Invoice or Bill of Supply or Challan related to the consignment of goods
- Transporter ID or vehicle number in case of transportation by road
- Transporter ID, Transport Document number, and document date for transportation by rail, air, or vessels.
The validity period of an e-way bill
The validity period is as follows:
|Type of cargo||Distance||Validity period|
Cargo other than over dimensional cargo on multimodal shipment in which at least one leg involves transport by ship
|Up to 100 km||One day|
|Cargo other than over dimensional cargo on multimodal shipment in which at least one leg involves transport by ship||For every 100 kilometres or part thereafter||One additional day|
|Over dimensional cargo on multimodal shipment in which at least one leg involves transport by ship||Up to 20 kilometre||One day|
|Over dimensional cargo on multimodal shipment in which at least one leg involves transport by ship||For every 20 km and part thereof||One additional day|
According to the latest notification, the validity of the e-way bill may be extended within 8 hours from the time of its expiry.Therefore, the validity period of the consolidated e-way bill cannot be ascertained. The validity period shall be taken as per the individual consignment validity period and the consignment should reach the destination as per the validity period of the individual consignment.
However, it has been clarified by a press release that the validity period of any variable shall start only after the details in part B of the form GSTEWB-01 are updated by the transporter for the first time.
Specification of the cases where an e-way bill is not compulsory to be generated
An e-way bill is not compulsory to be generated in case of the following
- Transport of goods by a non-motorised transport.
- Transportation of goods from port and land customs station to an container depot (inland) or a container freight station for clearance purposes by customs.
- In relation to the movement of goods within those areas which are notified under the rules drafted and followed by the respective state.
- For the goods transported are alcoholic liquor for human consumption (which is out of the purview of the Act) and those which are not recommended by the GST Council namely petroleum, crude oil, high-speed Diesel, motor spirit (commonly known as petrol) natural gas and aviation turbine fuel, is there no requirement.
- For goods that are treated as no supply Schedule III of the CGST Act, 2017.
- For goods other than crude oil being transported and related to exempted goods.
- Transportation of goods by railway where the consignor of goods is the Central Government, State government or local authority.
- Transportation of goods from or to Nepal or Bhutan.
- Transportation of empty cargo containers.
- Where Defence formation ( by Ministry of Defence) is the consignor or the consignee.
Documents required to be carried by the person in charge of a conveyance
A person in charge of a conveyance must carry the following:
- The invoice of goods for supply or the bill of supply (in case of composition dealer) or the delivery challan (in case of no supply)
- A copy of the e-way bill in physical form or for the e-way bill number in electronic form or map to a radio frequency identification device embedded on the conveyance as notified by the Commissioner.
The second point shall not apply in case of movement of goods by rail or by air or vessel.
When Part B of the e-way bill is not required?
According to CGST rules, when goods are transported for less than a distance of 50 kilometres for intra-state supply from the place of business of the originator to the Transporter for further transportation, the supplier or the recipient or the Transporter, whoever is not required to furnish the details of the transport in part B of Form GSTEWB-01.
Acceptance or rejection of an e-way bill
The information of the e-way bill shall be communicated to the supplier or the recipient if registered and such supplier or recipient shall also inform his acceptance or rejection of the goods as mentioned in the e-way bill.
In case if supplier or the recipient does not inform the acceptance or rejection in a period of less than 72 hours or before the delivery of the goods to such place, whichever is earlier, it shall be assumed to be accepted by such supplier on recipient.
Computation of consignment value of the supply for the purpose of e-way Bill generation
- As per the expectation provided by CGST rules, the value of the consignment shall be
- The value declared in the invoice or bill of supply or delivery challan issued in respect of the said consignment
- It shall also include the amount of Central tax state or union territory tax integrated tax and cess
- It shall exclude the value of exempt supply of goods in case if the invoice is issued after considering both the exempt and taxable supply of goods.
Cancellation of e-way bill
E-way bill can be cancelled after its generation only when goods are either not conveyed or not conveyed as per the details given in the e-way bill. it can be cancelled electronically on the common portal either directly or through a facilitation centre notified by the commissioner. The time period of cancellation is within 24 hours of generation of an e-way bill. An e-way bill cannot be cancelled if the same has been verified in transit by the authorities.
Non-compliance of e-way bill
There are legal consequences for non-compliance with the e-way bill. In cases where an e-way bill is a required document but these are not issued in accordance with the rules and provisions specified, the same will be treated as contravention of the rules and non-compliance shall apply as follows:
A taxable person who transports any taxable goods without an E-way bill shall be liable to a penalty of Rs. 10000 or tax sought to be evaded whichever is greater.
Where any person transports in goods or stores any goods which contravenes the provisions of the Act or the rules, such goods shall be liable to detention or seizure along with the conveyance used as a means of transporting the said goods.
Provisions relating to generation of e-way bill in case of Trans -shipment
In cases where a consignment is required to be shipped which involves multiple transporters that are having different Transporter IDs. It is known as trans-shipment. The consignor or the recipient has furnished the details in Part A of form GSTEWB-01, the Transporter will assign the e-way bill number to another registered transporter for updating the information in part B of the same form for the movements of the consignment. Once, reassigned by the transported to another Transporter, the seller cannot make any changes for that particular assigned Transporter. Hence the user has to generate different delivery challans for different Transporter ID and not e-way bills because different e-way bills against a single consignment will create problems in entering data for GSTR-1.
Modes of generating e-way bill
E-way bills can be generated online through the GST portal dedicated for e-way bill generation and it can also be done via SMS. A person who requires to generate a single e-waybill or users who do not have the facility to access the website are given the facility of using SMS for generating an e-way bill.
It is helpful at the time of urgency and for small businesses. Not only generation but the modification, update and deletion of an e-way bill can be done with the use of SMS facility.
For Bill to and Ship to transactions
Place of dispatch shall be the address of the place from where the goods are dispatched for the movement to the recipient.
Bill to shall include the details of the party on whose options the goods are being transported on the place of Ship to.
Ship to the place where the goods are to be disposed of at the will of the registered person who is a Ship to party.
Therefore an E-way bill helps in smooth transportation and tracking of goods on the E-Way Bill System. The procedures for generating an E-Way Bill are easy for even small businesses.Business should use it to follow the law and help in smooth movement of goods.