Every consignment worth ₹50,000 or more must have an official document known as a waybill, issued by the government, comprising essential details related to the shipment. When generated electronically, the paper is called an e-way bill.
As per the mandate under the Goods and Services Tax (GST) Act, almost all goods must possess this paperwork, apart from a few exemptions.
What is an E-way Bill?
An e-way bill is an electronically generated document essential for a transporter to bear when carrying a consignment worth ₹50,000 or more. It includes vital shipping details like the consignor/consignee's name, the end destination of goods, origin, route, etc. Additionally, it consists of the Goods and Services Tax Identification Number (GSTIN), *challan *details, transporter ID, and other vital codes.
As per the e-way bill rules stated under rule 138 of CGST Rules, 2017, transporters carrying all types of goods except those listed under rule 138 (14) are obligated to file an e-way bill.
An individual can generate the e-way bill from the common portal of the e-way bill.
Why is the E-way Bill Required?
An e-way bill holds information about the shipment and prevents the goods from getting lost during transit. Moreover, the document keeps government officials and authorities in the loop regarding all shipments flowing out of the country, allowing them to check tax evasions. Additionally, the bill ensures that all the goods comply with the GST regulations.
When is an E-way Bill Generated?
The generation of an e-way bill occurs when single or multiple consignments totaling ₹50,000 or more need to be transported from one location to another. The movement of goods may take place due to either of the following reasons:-
- When party A is supplying the goods to party B.
- When party A is transporting goods to party B but not supplying them (for example, in the case of returns).
- When party A is receiving goods from party B, in the case of party B being unregistered under the GST Act.
However, an e-way bill is generated in some cases, even if the goods cost less than ₹50,000. For instance, a handicraft dealer, who has been exempted from GST, transports goods from one state to another.
Who can Generate an E-way Bill?
The following three types of people can generate an e-way bill in most cases.
Registered person: A person registered under the GST Act can generate an e-way bill when supplying or receiving goods worth ₹50,000 or more. Such an individual can create the bill even if the consignment's value is below ₹50,000. However, this isn't mandatory.
Unregistered person: A person not registered under the GST Act must create an e-way bill when supplying goods with a value of ₹50,000 or more. However, suppose an unregistered person supplies such a consignment to a registered person. In that case, it is the latter's responsibility to ensure the shipment meets all the required compliances as if they were the supplier.
Transporter: If the supplier has not generated an e-way bill, it is the transporter's responsibility to develop it. If the Transporter isn't registered, they must enroll on the e-way bill portal, after which they will receive a transporter ID. The ID can be used to generate the bill.
What are the Contents of E-way Bill?
An e-way bill has two primary components--part A and part B.
This section of the e-way bill comprises three subsections:-
- Transaction details: This includes information like the type of supply; type, number, and date of the document; the type of transaction.
- Consignor and consignee’s details: This includes the GSTIN, name, location, address, and pin code of both the sender and the receiver.
- Item details: This subsection comprises further details of the goods like product name, quantity, Harmonized System of Nomenclature (HSN) code, value, and tax rates.
Note: The consignor of the goods must generate part A of the bill, which is only valid for 24 hours. The consignor can cancel the part A slip without letting it get delayed.
The second part of the e-way bill comprises the transporter's details. It includes the transporter ID, name, and vehicle number.
A supplier must fill this section for the successful delivery of goods. However, the transporter will be able to update the details if needed.
> Note: Part B of the bill is valid for 72 hours. It allows the receiver to reject the shipment within 72 hours and let the exporter extend its validity if needed.
What are the Pre-requisites to Generate the E-way Bill?
Here are a few conditions that an individual must fulfill to generate the e-way bill:-
- The applicant must be registered under the GST Act.
- The applicant needs to register at the e-way bill portal. If the transporter isn't registered under the GST Act, they must enroll at the e-way bill portal.
- Whoever generates the e-way bill must have documents like the tax invoice, transporter's ID, bill of sale, vehicle number, and other essential documents
How is an E-way Bill Generated?
An individual registered under the GST Act can generate an e-way bill through the following means:-
- E-way bill portal
- Via an SMS
- Android app
- API (site-to-site integration)
- Bulk e-way bill generation facility
- Goods and Services Tax Suvidha Provider (GSP)
E-way Bill Generation Process
To start with the e-way bill generation process, an individual must first register under the GST Act, and the transporter must complete the transporter's registration.
Here are the steps to do so:-
Step 1: Visit the e-way bill portal and log in by entering the username and password. Step 2: Under the 'E-way bill' drop-down menu, click on the 'generate new' tab. A blank form will appear. Step 3: In the A section, fill out the transaction type. Choose the 'outward' option if you are a supplier and the 'inward' option if you are the consignee or the receiver of the goods. Step 4: Fill in the sections like 'subtype,' 'document type,' and 'document no.' Step 5: Fill out the 'bill from' and 'bill to' sections carefully. As you enter the GSTIN number, the other fields will be filled in automatically. Cross-check before going ahead. Step 6: In the next section, enter the details of the goods. Start by entering the product name and description correctly, as documented in the tax invoice. Step 7: Search for the HSN Code here and fill in the other required tax details.
> Note: An individual must fill the IGST amount if the transport is across different states and the CGST amount if the transport is within the state.
Step 8: Fill in the transportation details like the transporter's name, ID, and the approximate distance to be covered. The distance will determine whether the e-way bill is valid or not. Step 9: Part B of the form comprises details like mode, vehicle type, number, etc.
> Note: Filling part B may not be necessary for the intra-state transport of goods.
Step 10: Double-check all the details and click on the 'submit' button. The screen will display the newly generated e-way bill number, digital form, and QR code.
> Note: The transporter must carry the printed e-way bill along with the consignment until it is given to the consignee.
Validity of an E-way Bill
An individual can calculate the validity of an e-way bill according to the distance traveled. For every 200 km, the validity of the bill is one day.
The following table displays the validity of the e-way bill according to the conveyance and the distance traveled.
Here are a few points regarding an e-way bill’s validity that you must keep in mind:-
- Every e-way bill valid for one day will expire at midnight on the same day.
- The validity period of the bill starts after an individual enters the part B details for the first time.
- If the validity expires before the consignment is delivered, the responsible individual must generate a new e-way bill, with the exception mentioned in the point below.
- The transporter can extend the validity if the shipment is delayed due to unusual circumstances like natural calamities, issues related to law and order, accidents, and trans-shipment delays.
> Note: The transporter can only extend the validity eight hours before the expiry up to eight hours after the expiry.
Following is a list of the documents that an individual must have while generating an e-way bill:
- Supply bill, challan, or the invoice of the goods to be shipped.
- Transporter ID in case of shipment by road and both the ID and the transport document number for shipment via air/rail/ship.
Verification of Documents and Supplies
The transporter may have to verify the documents and goods they are carrying.
In case an authorized officer halts the vehicle to verify the documents, a copy of the e-way bill will be sufficient for the verification. The concerned officer can also verify the e-way bill through the Radio Frequency Identification Device (RFID).
> Note: Once an official conducts the physical verification of the transport in the same state or any other state, they will not conduct further verification.
In some cases, the consignor or the transporter need not generate an e-way bill. These exemptions include:-
- If the consignment comprises goods mentioned in the GST chapter 16 E-way Bill Rules 138 (14) Annexure.
- The goods are delivered by a non-motor conveyance.
- When the consignment is transported from a customs land station, air cargo, airport, or port to a container freight station or an inland container depot ICD for further clearance by a customs official.
- The consignment is transited under a customs seal or special supervision.
- Goods are transported from ICD to another customs port under a customs bond or between different customs stations.
- Any transit cargo shipped to or from Nepal and Bhutan, as stated by the Union Finance Ministry.
- Goods moved under the Ministry of Defense.
- If the cargo containers being transferred are empty.
- In case the transporter has a delivery challan to move goods to or from the location of the business within a distance of 20 km.
- When the mode of transportation is by rail under official bodies like the central government, state government, or any local authority.
- If the consignment value is below ₹50,000.
Status of Implementation across India
Since the release of notification from the tax department of India on 1st April 2018, the generation of e-way bills has become compulsory for the interstate transfer of goods. For transfer of goods within the state or intrastate, the notification was released on 3rd June 2018. For Delhi, it was released on 16th June.
However, a few state governments have provided relief for the intrastate transfer of goods.
- The Bihar government has increased the requirement of an e-way bill for goods valued above ₹2,00,000.
- Gujarat Commissioner of Tax has removed the e-way bill requirement for goods like fabric, yarn, and garments. Moreover, the bill is required only for 19 types of goods, as stated by the Institute of Cost Accountants of India (ICMAI).
- In Goa, one must generate an e-way bill only for 22 goods like iron, tiles, timber, and others, as stated in the ICMAI list.
- Himachal Pradesh requires an e-way bill only for 17 types of goods, and Madhya Pradesh only for 11.
- In West Bengal and Tamil Nadu, an e-way bill must be generated only for goods valued over ₹1,00,000.
FAQs on E-Way Bill
1. How to extend e-way bill validity?
The transporter can extend the e-way bill validity from the portal. Under the e-waybill section, choose the extend validity button and enter the e-way bill number in the box that appears. Follow the prompts and state the reason for the extension. Next, the individual can enter the details in part B of the form. Enter the required information and generate the new e-way bill number.
2. What are the penalties associated with the e-way bill?
According to the CGST Act 2017, chapter XIX, section 122, any taxable individual carrying a consignment without the necessary documents, including the e-way bill, must pay ₹10,000 as the penalty. Alternatively, the person in charge may have to pay an amount equivalent to the evaded tax if that is greater than ₹10,000.
3. What is the penalty for an e-way bill?
The minimum penalty for not filing the e-way bill is ₹10,000. The individual must pay the amount equal to the tax evaded if that is greater than ₹10,000.
4. What is the exemption limit for e-way bill?
The exemption limit for the e-way bill is ₹50,000. If the aggregate value of the goods being shipped is ₹50,000 or higher, an e-way bill becomes mandatory by law.
5. What is SKD CKD in the e-way bill?
Semi Knocked Down (SKD) and Completely Knocked Down (CKD) refers to a condition wherein the goods to be shipped are separated into multiple parts for ease of conveyance. In either of these cases, the consignor must create a single consolidated invoice for all the goods. They can then generate individual e-way bills for each vehicle carrying the consignment.
6. What is the assessable value in the E-WAY bill?
The total operating value of goods, including production, freight, and insurance plus 1% of the total amount, refers to the assessable value. It helps determine the amount of tax to be paid.
7. What is a part-A slip?
Part A slip is the number that an individual will get on filling the upper half of the e-way bill form. They can save their progress and log in with the number to continue later.
8. Can the e-Way Bill be modified or edited?
No, once generated, an e-way bill cannot be modified or edited. However, a transporter can extend its validity and update part B of the form. Another option is to cancel the bill within 24 hours of its generation and reapply for a fresh one. But if it has already been verified as per the CGST provisions of rule 138B, it cannot be canceled.
9. What if the goods of one invoice are being moved into multiple vehicles simultaneously?
If the goods are SKD or CKD, the consignor must create separate e-way bills for each vehicle through the same invoice number. The consignor must also provide the transporters with the respective challan for every vehicle.