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As India continues its massive economic growth, the implementation of the Goods and Services Tax (GST) in 2017 represented one of the country’s most monumental fiscal policy moves. This new value-added tax system consolidated a complex web of overlapping central and state taxes into one unified framework.
For businesses operating in India or engaged in trade between states, compliance with GST requirements is now an essential part of operations. One of the most important compliance aspects that companies must get right is the eWay Bill system.
An eWay Bill is essentially a document that must be generated when moving goods worth over Rs. 50,000 in value from one place to another. It is electronically generated through the GST Network’s portal and contains key details about the goods in transit and the vehicle transporting them.
Having a valid eWay Bill is crucial, as transporting goods without one can lead to hefty fines. The fines can be as high as Rs 10,000 and even include confiscation of goods and seizure of vehicles in some cases. Strict compliance is therefore a must.
In this comprehensive guide, we will dive deep into all aspects of the eWay Bill system under GST. We’ll cover when an eWay Bill is required, who must generate it, the process of generating it online, documents needed, and more. We’ll also answer some frequently asked questions and provide tips for staying continually compliant.
With the right knowledge, ensuring your business has valid eWay Bills for all applicable goods movements doesn’t have to be difficult. Our guide will provide the insights you need to master eWay Bill compliance and avoid non-compliance penalties. Let’s get started!
What Exactly is an eWay Bill?
Simply put, an eWay Bill is a document that must be generated whenever goods worth more than Rs. 50,000 are transported from one place to another within India. It is an electronic bill that can only be generated through the Government’s eWay Bill portal.
The eWay Bill portal is managed by the National Informatics Centre. It can be accessed at https://ewaybillgst.gov.in or through the mobile app. Transporters, suppliers, distributors and registered businesses who regularly dispatch and receive goods are required to register on this portal.
The eWay Bill serves a couple of important purposes:
- It ensures that goods being transported comply with GST and avoids possible tax evasion. Authorized officers can inspect the eWay Bill anytime during transit to verify if the materials match the documents.
- It provides a streamlined process for movement of goods between states. Checkposts are notified of the valid movement electronically, smoothing out the transit process.
- It improves operational efficiency by documenting and tracking movement of goods, allowing transporters to plan better.
When an eWay Bill is generated, the portal automatically allocates a unique 12-digit reference number for that specific shipment. This Electronic Way Bill Number (EBN) contains vital details about the goods in transit, including:
- Type of transaction (supply, export, import, job work etc.)
- GSTIN of supplier and recipient
- Value of goods
- HSN code
- Transport details
The EBN can be shared electronically with registered suppliers, recipients and authorized transporters for seamless tracking of shipments. EWay Bills can also be generated or cancelled through SMS, Android App and API integration.
By providing end-to-end tracking of goods and documentation through a centralized online system, the eWay Bill framework improves compliance, prevents tax leakage and enhances logistics efficiency. Businesses must ensure compliance by generating eWay Bills for all applicable goods movements.
When Should an eWay Bill be Issued?
The most important thing businesses need to know is – when is an eWay Bill required to be generated?
Let’s first talk about the value threshold. An eWay Bill needs to be generated whenever goods worth more than Rs. 50,000 are transported via road, air, rail, or ship within India. This applies to all of the following:
- Inter-state movement (between two or more states)
- Intra-state movement (within the same state)
- Supply to or from an SEZ (Special Economic Zone)
This Rs. 50,000 value threshold is for a single invoice, purchase order, delivery challan or bill of supply. So if a single invoice for goods is above Rs. 50,000, an eWay Bill must be generated.
But that’s not all. If a vehicle is transporting multiple invoices or delivery challans, then the aggregate value of ALL the invoices together is considered. If this total aggregate value exceeds Rs.50,000, then also an eWay Bill is required.
For example, say a transporter is carrying 3 separate consignments in one truck:
- Invoice 1 from Agra to Kanpur for Rs. 15,000
- Invoice 2 from Delhi to Kanpur for Rs. 12,000
- Invoice 3 from Gurgaon to Kanpur for Rs. 35,000
Looking at each invoice individually, no eWay Bill seems to be required. But the total aggregate value of all three invoices together is Rs. 62,000 (15,000 + 12,000 + 35,000) which crosses the Rs.50,000 threshold. So this shipment would require an eWay Bill.
Now that we’ve seen the value threshold, let’s look at the situations where an eWay Bill becomes mandatory:
- Inter-state Transportation of Goods for Business Purposes
Any movement of goods between two or more states (or Union Territories) for reasons of business or trade requires an eWay Bill if the value exceeds Rs. 50,000.
For example, if inventory is being dispatched from a warehouse in Haryana to a retail store in Assam worth Rs. 1 Lakh, an eWay Bill must be generated by the supplier.
- Intra-state Transportation for Business Purposes
Similarly for goods moving within the same state, an eWay Bill is compulsory above the threshold. For instance, goods shipped from a factory in Hosur (Tamil Nadu) to a distributor in Chennai (Tamil Nadu) requires an EWB if the value is greater than Rs.50,000.
- Business to Consumer Inter-state shipments
An eWay Bill is required even if the movement of goods is Business to Consumer (B2C) instead of Business to Business. So inter-state shipment of goods from a Delhi warehouse to the end consumer in Jaipur over Rs.50,000 value needs an eWay Bill.
- Movement of Goods for Export/Import
Goods moved for export out of India or import into India also require an eWay Bill just like domestic transactions. For example, goods shipped from Mumbai port to an exporter in the Netherlands.
- Empty Goods Transport for Repairs/Maintenance
This is a commonly missed scenario. Even transport of empty containers or vehicles for repairs or maintenance between states requires an eWay Bill if the value of the empty shipment itself exceeds Rs.50,000.
These are the main situations where businesses must be extremely careful to generate an eWay Bill before transporting goods to avoid penalties. Maintaining up-to-date compliance is crucial.
Who Should Generate an eWay Bill?
Now that we know when an eWay Bill is required, let’s look at who exactly is responsible for generating it in different scenarios.
The responsibility typically falls on the supplier, recipient or transporter depending on the situation. The general guidelines are:
Any registered business that is transporting goods worth more than Rs.50,000 in value is required to generate the eWay Bill. This applies to both inter-state or intra-state movement.
For example, if a mobile phone manufacturer in Uttarakhand is sending a shipment worth Rs. 70,000 to a distributor in Bihar, the manufacturer is responsible for generating the eWay Bill before dispatch.
Unregistered businesses transporting goods inter-state or intra-state over the threshold value have to comply as well. But they can request the recipient (if registered) to generate the eWay Bill on their behalf. The receiver then needs to ensure all compliance requirements are fulfilled.
For instance, if an unregistered cotton farm in Maharashtra sends cotton worth Rs. 55,000 to an apparel manufacturer in Tamil Nadu, the apparel manufacturer would need to generate the eWay Bill on behalf of the unregistered farm.
Transporters or logistics companies transporting goods between states need to generate eWay Bills if the supplier has not already generated one. If the supplier fails to create an eWay Bill, the transporter has to generate it based on invoice details provided to them.
For example, Delhi Transport Co. is transporting machinery from a supplier in Delhi to a buyer in Haryana worth Rs.70,000. If the supplier has not provided an eWay Bill, Delhi Transport Co. will be required to produce one before dispatching the goods.
Table summarizing key responsibilities:
|Must generate eWay Bill for transporting goods >Rs.50,000 (inter or intra-state)
|Can request Registered Recipient to generate EWB on their behalf
|If goods received from unregistered supplier, recipient must generate EWB
|If goods transported inter-state, transporter must generate EWB if not created by supplier
In summary, the key things to note are:
- For registered businesses, the responsibility is on the supplier sending goods to generate the eWay Bill if value exceeds Rs.50,000 before movement of goods.
- Unregistered suppliers can request recipients to create it for them.
- Transporters must generate eWay Bill if the registered supplier fails to create one.
Having clear knowledge of who has to generate the eWay Bill in different scenarios involving registered, unregistered, inter-state, intra-state etc. is important to ensuring smooth compliance.
Cases When an eWay Bill is Not Required
While eWay Bills are mandatory for transportation of goods in most cases, there are some specific scenarios where they are not required.
Some key examples of movements where eWay Bills are not necessary are:
- Goods transported via non-motorized conveyance
If goods are carried via non-motorized transport like a bicycle, handcart, bullock cart etc. where the value exceeds Rs.50,000, eWay Bills are not mandated.
- Goods transported from Customs ports or airports to Container Depots
Goods moving from customs ports, airports, air cargo complexes or land customs stations to Inland Container Depot (ICD) or Container Freight Station (CFS) for customs clearance do not require eWay Bills.
- Goods transported under Customs supervision or bonds
Any goods transported under customs supervision or customs bonds from one custom station to another are also exempt from eWay Bills.
- Transit cargo to and from Nepal/Bhutan
Goods in transit to or from Nepal or Bhutan do not require eWay Bills.
- Transport by Indian Railways
Movement of goods by railways where the consignor is the Central Government, State Government, a local authority or a government department do not need eWay Bills.
- Empty cargo containers
Empty containers being moved for repairs or maintenance purposes are exempt.
- Special state-specific exemptions
Certain states have provided exemptions on eWay Bills under specific conditions. For example, if goods value is less than Rs. 50,000 in Tamil Nadu, eWay Bills are not mandated. Similar exemptions exist in some other states too.
- Certain special goods
183 commodities like milk, vegetables, meat, relief materials, etc. have been exempt from eWay Bills upon state specific notification.
So while eWay Bills are needed in most cases, businesses can refer to these scenarios for exemption during goods movement. However, it is recommended that relevant notifications and circulars are studied carefully to confirm exemption eligibility to avoid hefty fines. When in doubt, generate eWay Bills to stay compliant.
State-wise eWay Bill Rules and Limits
While the eWay Bill requirements are standardized under GST at a national level, certain states have imposed additional rules, thresholds and exemptions. Businesses need to be aware of state-specific rules that may apply to them.
Some examples of state-level deviations are:
- Rs. 50,000 exemption on eWay Bills for goods transported within Kerala for SSI units. Normal limits apply for movement outside Kerala.
- Gold, precious metals and stones are exempt when carried as personal baggage or cargo.
- eWay Bills exempted for goods value below Rs. 50,000 when moved within Tamil Nadu. Normal limits apply for inter-state movement.
- 183 commodities including vegetables, fruits, milk, salt and food grain are exempt within Tamil Nadu upon notification.
- Reduced limit of Rs. 20,000 for eWay Bill applicability on intra-state transportation. Normal Rs. 50,000 applies for inter-state.
- eWay Bill exempted for movement of silk cocoon and cotton within Karnataka.
- Limit of Rs. 50,000 for eWay Bill requirement applies to inter-state and intra-state movement. No additional state rules.
- Gold Jewellery exempt from eWay Bills upon meeting certain conditions.
- No special state-level exemptions. Normal central eWay Bill rules of Rs. 50,000 threshold apply.
- Certain additional documents like GST invoice may be required during transit along with the eWay Bill.
Therefore, businesses will need to ensure they are aware of not just the national eWay Bill requirements, but also any special rules and limits imposed by the states their goods move from, through or to.
Checking your respective state’s eWay Bill notifications is advisable to avoid non-compliance. Consulting with your GST practitioner can help clarify any confusion regarding state-specific compliances.
How to Generate an eWay Bill
Now that we’ve covered when and who has to generate eWay Bills, let’s look at how to actually generate them.
The process to produce eWay Bills is completely online through the eWay Bill portal. Follow these steps:
Step 1) Register on ewaybillgst.gov.in
First, the generator of the eWay Bill (supplier, recipient or transporter) needs to register on the eWay Bill portal. This involves providing business details like GSTIN, trade name, PAN etc.
Step 2) Login to the eWay Bill portal
After registration, you can login with your credentials. Make sure to use the right GSTIN if you have multiple.
Step 3) Enter Part A details
Part A mainly covers the goods details like invoice value, HSN code, tax details, delivery address etc. This needs to be filled carefully and accurately.
Step 4) Enter Part B details
Part B captures the transporter details if known at the time like transporter ID, vehicle number, transport document number and date.
Step 5) Preview and Generate eWay Bill
Preview the eWay Bill details before generation to ensure everything is correct. Then click Generate eWay Bill to produce it.
Step 6) Print or Save eWay Bill
Finally print or save the official eWay Bill that contains the unique 12-digit EBN number. This needs to be carried during transit by the transporter.
Additional Things to Note:
- Multiple eWay Bills can be generated for one invoice if it involves multiple consignments being transported in separate vehicles.
- If Part B details are not available at the time, Part B can be filled later within 72 hours before dispatch.
- eWay Bills can be cancelled if required within 24 hours of generation.
- Consolidated eWay Bills can be generated using Form GST EWB-02 if one vehicle carries multiple small consignments.
Generating eWay Bills via SMS and APIs:
Large transporters and ERP-enabled businesses can also generate and manage eWay Bills via SMS, mobile app or through integration with software using APIs.
For SMS, registered mobile numbers must be linked to the eWay Bill system. APIs allow seamless integration with transport/logistics management systems.
Using SMS or API eWay Bill generation requires prior configuration but offers a convenient automated way to bulk generate and manage eWay Bills.
By providing a step-by-step overview of the entire eWay Bill generation process online, via SMS or APIs, businesses can ensure smooth compliance and avoid rejections or penalties for data errors.
Validity of an eWay Bill
An important aspect of the eWay Bill system is that each eWay Bill has a defined period of validity. The validity is calculated based on the distance travelled by the goods.
The validity durations are:
For Regular Goods:
Up to 100km 1 day
For every additional 100km Additional 1 day
For Over Dimensional Cargo:
Up to 20km 1 day
For every additional 20km Additional 1 day
For example, if regular goods are being transported from Delhi to Mumbai, the distance is about 1400 km. So the eWay Bill for this shipment will be valid for 14 days (1 day for first 100 km + 13 days for additional 1300 km).
If validity is about to expire, transporters have two options:
- Request supplier/recipient to extend the validity period – The generator (supplier or recipient) can extend the eWay Bill validity by updating it on the portal. This can be done before expiry or within 24 hours after expiry.
- Generate a new eWay Bill – If validity cannot be extended, the transporter will have to halt the vehicle and generate a new eWay Bill with renewed validity before continuing the rest of the journey.
To avoid the hassle of extension or regeneration, the validity period should be carefully selected based on realistic travel time. Padding by a few extra days is recommended during generation.
Proper communication between suppliers, transporters and recipients is vital to monitor validity and ensure smooth movement of goods without interruptions enroute. Any delay could mean huge losses and waste in perishable goods.
Businesses should establish internal protocols for timely renewal of eWay Bill validity and monitoring transportation progress to avoid compliance issues. With sound processes, maintaining legitimacy of goods in transit can be effortless.
Documents Required for eWay Bill Generation
To generate error-free eWay Bills, certain documents with updated information are required during the process.
The key documents include:
- Invoice – The tax invoice, bill of supply or delivery challan related to the goods being transported. This provides details like invoice value, GSTIN, place of supply etc. Required for Part A details.
- Packing List – A list specifying contents of the shipment, packages, quantity etc. Helps include accurate details in the eWay Bill.
- Transport Contract – Any contracts or agreements with the transporter carrying the goods. Provides transporter details for Part B.
- Tax Certificates – GST registration certificate to enter GSTINs correctly in the eWay Bill.
- Export/Import Documents – For movement of goods outside India, relevant export or import documents need to be referred.
- Exemption Certificates – Any certificates for exemptions in special scenarios need to be kept handy for verification.
- Authorization Forms – Required if a third party logistics provider is generating eWay Bill on behalf of the supplier.
Keeping these documents prepared and up-to-date well in advance of transporting goods ensures quick and smooth generation of compliant eWay Bills within minutes.
Digitization of documentation through ERP integration further simplifies the process and reduces manual errors in data entry. Proper documentation prevents rejection of eWay Bills due to information mismatch. It also provides evidence of compliant movement of goods if questioned during transit.
With the right documents in hand, eWay Bill generation becomes a breeze allowing businesses to stay worry-free.
Frequently Asked Questions on eWay Bills
Q1. Can multiple invoices be clubbed under one eWay Bill?
No, a separate eWay Bill needs to be generated for each distinct invoice, delivery challan or bill of supply. However, if a vehicle is carrying multiple invoices/documents, a consolidated eWay Bill can be produced using form GST EWB-02. This allows reporting of multiple consignments in one eWay Bill.
Q2. Is an eWay Bill required when transporting goods within 10 km?
Earlier, movement of goods within 10 km did not require an eWay Bill. However, this limit has now been increased to 50 km. Inter and intra-state transport within 50 km is exempt if it does not cross state borders. Beyond 50 km, eWay Bill is required above Rs.50,000 value.
Q3. When should I generate an eWay Bill if the invoice is raised much earlier than actual movement of goods?
The eWay Bill should ideally be generated within 24 hours before the actual movement of goods begins. If the invoice is raised way in advance, the eWay Bill generation can be postponed closer to the dispatch date. Validity of the eWay Bill starts only from the time Part B details are furnished after goods are ready for transport.
Q4. What is the liability of the transporter in the eWay Bill process?
If the supplier fails to generate the eWay Bill, the transporter is liable to produce it before transit based on invoice details. If the transporter defaults too, they can be penalized Rs 10,000 or 100% tax liability, whichever is higher. Their vehicle may also be impounded. Transporters also need to ensure the eWay Bill remains valid throughout the journey.
Q5. How many eWay Bills are required if multiple transporters are involved?
Even if multiple transporters are used to reach the destination, only one eWay Bill needs to be generated for the entire journey. The original generator can assign the eWay Bill to different transporters involved in various legs of the shipment by updating it on the portal. Thus, one eWay Bill can have an audit trail of multiple transporters handling the same consignment.
Q6. What is the value of consignment considered – Is it invoice value or taxable value?
The threshold of Rs.50,000 is based on the total invoice value inclusive of taxes. It excludes only the value of exempt goods if any transported along with taxable goods in the same conveyance.
We hope these commonly asked questions help solve some of the common dilemmas around eWay Bill generation, validity and responsibilities. Please consult a GST professional in case any doubt arises.
Latest Updates in eWay Bill Compliance Requirements
The eWay Bill system aims to improve over time by plugging loopholes based on practical experiences. Here are some key recent updates:
- Blocking for GST non-compliance – From 15th November 2022, taxpayers who have failed to file their GSTR-1 and GSTR-3B for previous tax periods will be blocked from generating fresh eWay Bills. This ensures return filing compliance.
- QR code on eWay Bills – From November 2022, a quick response (QR) code has been added to eWay Bills. This allows faster verification of eWay Bills by scanning the QR code using mobiles instead of entering the EBN manually.
- Reduction in validity – From 1st December 2022, validity period of eWay Bills for long distance transport has been reduced from 20 days to 10 days for better tracking of movement of goods.
- Mandatory IRN on B2B invoices – From April 2023, including the Invoice Reference Number (IRN) generated on B2B invoices will become mandatory while generating eWay Bills for better matching.
- Barcode/RFID tagging – The government intends to mandate unique barcoding/RFID tagging of goods transported to further improve tracking of movements and avoid tax evasion in a phased manner.
- Integration with FASTag – Integration of eWay Bill system with FASTag electronic toll collection is also on the horizon. This would allow automated tracking of vehicle movement between states.
- API based generation – Bulk API-based generation and integration of eWay Bills with GST and ERP software has been made easier through standardized APIs and documentation.
Staying up-to-date with the latest updates and changes in eWay Bill rules is vital for businesses. The added verifications and integrations will improve compliance, transparency and ease of doing business.
Conclusion: Ensuring Proper eWay Bill Compliance is Crucial
In summary, the eWay Bill system is a monumental step forward in improving movement of goods, preventing tax evasion and boosting logistics efficiency in India through digitization. It has made cross-country supply chains easier to manage transparently.
However, to reap the benefits, businesses must ensure compliance by generating valid eWay Bills before transporting any goods exceeding Rs.50,000 in value. Proper documentation, registrations, up-to-date details and monitoring of validity are vital.
Non-compliance can attract hefty fines, goods confiscation and even arrests. Having robust protocols and trained staff helps avoid any compliance slip-ups due to ignorance or oversight.
By mastering eWay Bill generation and staying up-to-date on the changing rules, companies can seamlessly integrate compliance into their logistics operations. Accurate documentation also improves supply chain visibility.
India’s GST and eWay Bill reforms showcase how digitization and process standardization can transform the ease of doing trade. Businesses that embrace the new tech-driven approach will gain efficiency, transparency and thrive in the emerging digital economy. The future looks promising.