E-WAY BILL

E-way bill

TABLE OF CONTENTS
INTRODUCTION OF E –WAY BILL .......................... 2
OBJECTIVES OF E-WAY BILL ................................ 4
GENERTAION OF E-WAY BILL ............................... 5
COMPONENTS OF E-WAY BILL ............................. 6
METHODS OF GENEARTING E-WAY BILL ............ 7
STAKEHOLDERS INVOVLED ................................ 12
IMPACT OF IMPLEMENTING E-WAY BILL ........... 13
BENIFTS AND UTILITES OF E-WAY BILL ............ 15
CONCERN OF E-WAY BILL ................................... 16
CONCLUSION ......................................................... 17
REFRENCES ........................................................... 18

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E-way bill
INTRODUCTION
The introduction of GST (Goods and Service tax) w.e.f 1st July 2017 is landmark steps in
improving indirect tax collection across the country. However after a monthly Rs. 90,000
crore-plus inflow in the GST’s first three months, revenue in October drop to just over
Rs. 83,000 crore. Thus government decide to roll out the next set of GST features, such
as e-way bills and matching of invoices, will make tax evasion difficult and bump up
collections. Government has decided to implement E- WAY bill, for inter-state it will
commence from February 2018 and for intra-state from June 2018. The government,
while proposing the idea of incorporating provisions of e-Way Bill within the ambit of
GST, had said that this will provide various benefits to the industry such as:

 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, fall in transportation costs and reduction in transportation
lead time.

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E-WAY BILL SYSTEM

Waybill under Earlier VAT system
Each consignment under VAT regime shall be accompanied by a ‘Delivery Note’ which
was issued from the VAT offices to the taxpayer. At the end of every month the taxpayer
had to submit a utilization statement of the forms issued. The intention of the tax office
was that to control the tax evasion being done by few of the tax payers. The taxpayer was
also put a great deal of hardship while seeking the blank Delivery Notes. He/she would
have to make several visits to the tax office. At check-posts the trucks, would get detained
for a long time on frivolous grounds. Thus, it was lose lose situation for the trade as well
as the government.
E-Waybill under GST system
Electronic Way Bill (E-Way Bill) is basically a compliance mechanism wherein by way
of a digital interface the person causing the movement of goods uploads the relevant
information prior to the commencement of movement of goods and generates e-way bill
on the GST portal .E-way bill is pre-signed order for transport of goods that is obtained
electronically through the GSTN (Goods and Services Tax Network). A consignment,
which is worth INR 50,000 in value and minimum distance of 10k.m.cannot, be
transported without an e-way bill. When an e-way is generated, a unique e-way bill
number (EBN) is allocated and is available to the supplier, recipient, and the transporter.
All accepted e-Way Bills will be reconciled automatically in GSTR-1 during return filing.
This will curb the black economy as transportation of goods without a valid invoice and
raising of tax invoices without actual movement of goods will no longer be possible.

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Objectives of E-Way Bill

Single e-Way Bill for movement of the goods throughout the country.

To Prevent Evasion of tax.

Hassle free movement of goods across India

Tracking the movement of the goods with E-WAY bill number.

Easier Verifiction of the E-WAY bill by officers with previous verification of record.

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Generation of E-Way Bill

Generation of E-WAY Bill involves some question like When will E-way Bill is
generated , who should generate E-WAY Bill, components of E-WAY Bill and Methods
of generating E- way Bill.

When E-WAY Bill is generated?

E-way bill will be generated when there is movement of goods –
 In relation to a ‘supply’.
 For reasons other than a ‘supply’ (a return).
 Due to inward ‘supply’ from an unregistered person.
In this case, a supply can either be:

1. Sale – sale of goods and payment

made

2. Transfer – branch transfers for instance

3. Barter/Exchange – where the payment

is by goods instead of in money

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Who should Generate E-WAY Bill?

 E-way bill is to be generated by the consignor or consignee himself if the

transportation is being done in own/hired conveyance or by railways by air or by

Vessel.

 If the goods are handed over to a transporter for transportation by road, E-way bill

is to be generated by the Transporter.

 Where neither the consignor nor consignee generates the e-way bill and the value

of goods is more than Rs.50, 000/- it shall be the responsibility of the transporter to

generate it.

Components of E-WAY Bill

E-way bill is an electronic document generated on the GST portal evidencing movement
of goods. It has two Components-Part A comprising of details of GSTIN of recipient,
place of delivery (PIN Code), invoice or challan number and date, value of goods, HSN
code, transport document number (Goods Receipt Number or Railway Receipt Number
or Airway Bill Number or Bill of Lading Number) and reasons for transportation; and
Part B comprising of transporter details (Vehicle number).

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METHOD OF GENERATING E-WAY Bill:

E-Way Bill can be generated through E- way bill portal after furnishing details there. An
e-way bill contains two parts- Part A to be furnished by the person who is causing
movement of goods of consignment value exceeding Rs.50,000/- and part B (transport
details) to be furnished by the person who is transporting the goods. A Registered person
or the transporter may choose to generate and carry e-way bill even if the value of goods
is less than Rs 50,000. Unregistered persons or their transporters may also choose to
generate an e-way bill. This means that an e-way bill can be generated by both registered
and unregistered persons. However, where a supply is made by an unregistered person to
a registered person, the receiver will have to ensure all the compliances are met as if they
were the supplier. However Person can generate, modify and delete E-Way Bill through
SMS Facility. There are a set of SMS codes defined which can be used to work on the e-
way bills generation/ cancellation.

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People who can generate E-WAY BILL:

Who Time Annexure Part Form

Registered person in GST Ahead of Goods Complete Part A Form

Movement GST
INS-1

Registered person is consignee or Ahead of Goods Complete Part B Form

consignor Movement GST
INS-1

Registered person is consignor or Ahead of Goods Complete Part A & B Form

consignee and goods are transferred Movement GST
over to the transporter of goods INS-1

Transporter of Goods Ahead of Goods Complete Form GST –

Movement INS-1 if consignor
does not

Recipient is registered to the Recipient Undertakes – –

unregistered person compliance assuming
as supplier

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How GST E-way Bill Circulates

 Traders X delivers all the goods to Traders Y through the transporting company
LMN transporters

 In this handling of goods, Traders X have furnished all the related details of the
stock in the Part – A while remaining details of transporters in the Part – B form of
GST INS 01

 So according to the details which are furnished by the Traders X in Part A of form
GST INS 01, the LMN transporters will be generating the e-way bill from GSTN
portal, which is to be carried with the logistics vehicle.

 Just after the generation of the e-way bill, there will a unique e-way bill number
also noted (EBN) sent to all the three parties involved, Traders X, Traders Y and
the LMN transporters for the security purpose.

 Apart from this, all the designated details of the e-way bill will be sent to the
Traders Y for the validation for their acceptance and further proceedings.

Acceptance of GST E-way Bill

The generated e-way bill gets acceptance in the following cases:
 The consignment of available e-way bill is accepted by the recipient who is registered
on common portal
 If in case the recipient doesn’t respond to the available E-way bill details within 72
hours, then it is considered that the e-way bill is accepted by the recipient.

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Cancellation of E-Way Bill

Where an e-way bill has been generated, but goods are either not transported or are not
transported as per the details furnished in the e-way bill, the e-way bill maybe cancelled
electronically on the common portal, either directly or through a Facilitation Centre
notified by the Commissioner, within 24 hours of generation of the e-waybill. However,
an e-way bill cannot be cancelled if it has been verified in transit in accordance with the
provisions of rule.

Validity of E-Way Bill

The validity of e-way bill depends on the distance to be travelled by the goods. For a
distance of less than 100 Km thee-way bill will be valid for a day from the relevant date.
For every 100 Km thereafter, the validity will be additional one day from the relevant
date. The “relevant date” shall mean the date on which the e-way bill has been generated
and the period of validity shall be counted from the time at which the e-way bill has been
generated and each day shall be counted as twenty-four hours.

Documents to be carried by the person in

charge of conveyance
The person in charge of conveyance shall carry:

 Invoice or bill of supply or delivery challan .

 A copy of the E-way bill or the E-way bill number, either physically or mapped to
a Radio Frequency Identification Device (RFID) embedded on to the conveyance
in such manner as may be notified by the Commissioner.

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Stakeholders
The following are four key stakeholders of the e-Way Bill:

 Suppliers – Generate the e-Way Bills and reject the e-Way Bills
generated by other party against his/her name, if it does not belong to
him/her.

 Recipients - Generate the e-Way Bills and reject the e-Way Bills
generated by other party against his/her name, if it does not belong to
him/her.

 Transporters - Generate the e-Way Bills, consolidated e-Way Bills

and update the vehicle numbers for the e-Way Bills assigned to him
for transportation by the taxpayers

 Department Officers – Verify the e-Way Bills and consignments

carried with the e-Way Bills

The suppliers, recipients and transporters want to see that the consignment moves from
source to destination without any hurdles and tax officers want to see that the
consignment is accounted by the supplier and recipient.

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IMPACT of implementing E-WAY Bill in Present

Form
The provisions of E-Way Bills as per ‘E-Way Rules’ have certain significant provisions
impacting the industry and the transportation and logistics sector.

1) Issue of validity of E-way bill:

A report by EY and RAI published in December 2013 clearly states that the average
speed of Indian truck drivers is 20-40 km/hour, and the average distance covered daily is
250-400 kms. Compare this to the average speed of 60-80 km/hour and daily distance of
500-800 kms that truck drivers cover in developed countries and the problem becomes
apparent. Besides, truck industry is very fragmented and rid with theft and driver
downtime. Considering the deficient transportation infrastructure in most parts of India,
this validity period appears unrealistic and many assesses may find themselves renewing
the e-Way Bill frequently, increasing the compliance burden.

2) Change in Mode of Transport:

E-com retailers use several modes of transport to ensure that goods reach their required
destination from the warehouse or the manufacturer’s location. Thus they end up
generating large numbers of E-way bills. Many a times customers end up cancelling
orders even while the goods are in transit, or return goods already purchased. Fresh e-way
bills have to be generated each time this happens. E-com retailers who use third party
logistics will be able to generate E-Way Bills only when the transporter also uploads
details on the GSTN, which can cause potential delays in shipment.

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3) IT infrastructure of the Country:

E-Way Bill needs to be generated for every consignment exceeding INR 50,000 in value,
subject to certain exemptions. Previously, the Goods and Services Tax Network (GSTN)
portal struggled to cope up with the increased traffic during return filings. The addition of
e-Way Bill system to the portal without adequate strengthening of the back-end
infrastructure may result in further delays and difficulties for businesses. Also the E-
literacy and internet coverage is major issues which will affect the implementation of E-
way bill.

4) Increase in Additional cost to Transporter:

A certain class of transporters may be required to embed a unique Radio Frequency

Identification Device (RFID) on their conveyance and map the e-Way Bill to the RFID.
This will result in additional cost for the transporters and there is a possibility of raising
queries and harassment by the authorities on any anomaly.

5) More Empowerment to Authorities:

The e-Way Bill rules empower the Commissioner to authorise interception of any
conveyance to verify the e-Way Bill. Such a significant power to the Commissioner
contradicts the government’s commitment to abolish check-post system and can
potentially result in harassment from tax officials.

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Benefits and utilities of E-way Bill:

 E –Way may help move unorganised Transport companies to more organised form.
It helps in curbing malpractices and brings standardization of processes and bring
transparency in the system.
 Self-policing by traders. A trader while uploading gives the identification of the
buying trader who will also account the transaction automatically.
 All accepted e-Way Bills will be reconciled automatically in GSTR-1 during return
filing. This will curb the black economy as transportation of goods without a valid
invoice and raising of tax invoices without actual movement of goods will no
longer be possible.
 E-WAY Bill may bring freight costs down by reducing the freight time. As the
purpose of the bill is hassle free movement across the country results in fast
delivery of goods and service across the country.
 It may help in reduction of India Logistic cost to GDP ratio currently very high
compared to other nation. A study by Assocham-Resurgent India (2016) stated that
the country can save $50 billion if logistics costs reduce from 14 per cent to 9 per
cent of GDP. Reduced logistics costs would bring down prices of products.
 Digitization of the documentation process will ensure accountability and easier
Verification.
 E-way bill can lead to overhaul transport economics.
 E-way Bill helps in better tracking of transported goods with mechanism like
RFTG.

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Concern of E-Way Bill:

The implementation of e-Way Bill is deferred due to various reasons such as:

 Inadequate back end Information Technology (IT) infrastructure.

 Unorganised nature of the logistics sector in the country.
 There is fix time limit for e-way bill to be expired, hence the merchant have to ship
that consignment within those time period, else they have to generate new E-way
bill.
 Create a problem for e-commerce firm. They have to generate e-way bill each time
they change the dealer for shipment. If the customer in the meantime, cancels the
order before it reaches him, another e-way bill will have to be generated.
 In certain cases where the seller does not generate an e-way bill, it is the
transporter which has to do it. This implies that the logistics firm needs to gather
all the information about the products, including price, to be mentioned in the bill.
This could lead to delay in shipment.
 Under the VAT regime, there was no such process for intra-state movements.
Hence business needs to adapt to new mechanism.

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CONCLUSION
Way bill had been a nightmare for the suppliers in the pre-GST regime as compliance
around waybills had caused restricted movement of goods across states. This problem
is expected to be rectified via E-way bill. Most states have dismantled the border
check posts that operated previously, thereby reducing the time needed for movement
of goods across states. Generation of E way bill will be technology driven with little
human intervention. This will ensure better accountability and easier verification.
However, such reporting requirements will definitely take a toll on small traders and
unorganized transporters who are less acquainted with digital mode of working and
will lead to their harassment at the hands of tax officials. Technological aspects such
as internet coverage and e-literacy will have to be taken care of. If implemented
wisely, E way bills have the potential to make transportation of goods easier and
faster.

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References
 Electronic Way Bill in GST – CBEC Manual
 Cleartax.in blogs on E-way bill.
 News report published in The HINDU, Financial Express etc.
 E-Way Bill User manual published by NIC.
 Image source : The Indian express, draft annexure B by GSTN

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