There is now no system in place for the government to prevent tax fraud because there is no correlation between invoices and the real movement of commodities. This has also led to a decrease in real tax collection in comparison to the budget.

To combat tax fraud and improve trade monitoring, the GST Council had agreed to introduce the E-way Bill.

The proposed bill was the first step toward connecting E-way bill information with transaction data in GST returns, providing authorities with trade-level intelligence and reducing tax evasion.

So, how does the new E-Bill affect business? This article will guide you through what an E-Bill is and how to generate the same.

TABLE OF CONTENTS

• What is an E-Way Bill?
• When Should an E-Way Bill Be Listed?
• Who Can Generate an E-Way Bill?
• What is the Procedure for Creating an E-way Bill?
• When is an E-Way Bill not Required?
• FAQs
• Summing Up

Learn online GST courses from our expert

What is an E-Way Bill?

The government implemented the E-way bill, also known as the Electronic Way Bill, on February 1, 2018, to ease the seamless flow of commodities within and between states.

When the value of products and services exceeds 50,000 INR, an e-way bill is created on the e-way bill portal. The movement of goods cannot take place in the absence of an e-way bill in the event of a registered person whose worth exceeds 50,000 INR.

When the e-way bill is successfully generated, a unique E-way Bill Number (EBN) is generated and made available to the supplier, receiver, and carrier.

The E-way law will apply to both inter-state and intra-state transit of products.

The e-way bill allowing interstate goods transportation, on the other hand, went into effect on February 1, 2018. The intra-state rules, on the other hand, will be implemented between February 1 and June 1, 2018.

E-way bills may also be produced or canceled by SMS, Android App, and site-to-site connectivity via API.

When Should an E-Way Bill Be Listed?

When there is a movement of goods in a vehicle/conveyance with a value of more than Rs. 50,000 (either per invoice or in aggregate of all invoices in a vehicle/conveyance) an eWay bill will be created.

• About supply
• Other than a 'supply' (say a return)
• As a result of a 'supply' from an unregistered individual.
• A supply for this purpose might be one of the following:
• A supply is provided in the course of business for consideration (payment).
• A supply supplied in exchange for a consideration (payment) that may or may not be in the course of business.
• A provision made without thought (without payment)

In layman's terms, the term 'supply' typically refers to a:

• Selling - the sale of commodities and the receipt of payment
• Transfer – for example, branch transfers
• Barter/Exchange – where payment is made in products rather than money

As a result, eWay Bills for all of these sorts of movements must be created on a single platform.

Even if the value of the consignment of Goods is less than Rs. 50,000, an E-way bill must be created for specific designated Goods:

• Inter-state movement of products by the Principal to the Job-worker by the Principal/registered Job-worker
• Inter-state transportation of handicraft items by a dealer exempt from GST registration

Who Can Generate an E-Way Bill?

When there is a movement of items worth more than Rs 50,000 to or from a registered individual, an E-way bill must be created.

• Even if the value of the products is less than Rs 50,000, a registered person or carrier may opt to produce and carry an E-way bill.
• Unregistered individuals must also create an e-Way Bill. When an unregistered person makes a supply to a registered person, the receiver is responsible for ensuring all compliances are satisfied as if they were the provider.
• Transporters who transport products by road, air, rail, or other means must also create an e-Way Bill if the supplier has not done so.

Note: If a transporter is conveying many consignments in a single conveyance, they can utilize the GST EWB-02 form to generate a consolidated e-way bill by supplying the e-way bill numbers for each consignment.

If neither the consignor nor the consignee has established an e-way bill, the transporter can do so * by completing PART A of FORM GST EWB-01 using the invoice/bill of supply/delivery challan provided to them.

What is Necessary to Create an E-way Bill?

• Invoice/Bill of Supply/Challan for a shipment of commodities
• Road transportation - Transporter Identification Number (ID) or Vehicle Identification Number (VIN)
• Transportation through train, air, or ship — Transporter ID, Transport document number, and document data

What are the Exceptions to the Requirement for an E-way Bill?

• Transportation of certain items.
• A non-motor vehicle is used as a form of transportation.
• Goods are carried from a port, airport, air cargo complex, or land customs station to an Inland Container Depot (ICD) or Container Freight Station (CFS) for Customs clearance.
• Part B of the e-Way Bill does not need to be filled out if the distance between the consigner or consignee and the transporter is less than 10 kilometers and the shipment is intra-state.

You may also like this:

• What is GSTR1 and How to File it?
• What are the types of GST in India?
  What is the Validity of an E-way Bill?
  

The e-way bill's validity period is determined by the distance traveled while transporting products from one location to another.

The e-way bill is valid for one day if the trip is less than 100 kilometers. Furthermore, the validity period is extended by one day for every extra 100 kilometers or portion thereof.

What is the Procedure for Creating an E-way Bill?

The first step is to log in to the e-way bill system (ewaybillgst.gov.in). After the login, fill in the details:

• Username
• Password
• Captcha
• Next, click on Login.

Learn online GST courses from our expert:-

The next step is to create a new e-way bill. Navigate to the e-way bill area and click "Generate New." This option is located on the dashboard's left side.

An input form will show on the screen after producing a new e-way bill. You must now complete all of the fields on the entry form. Under this you will have two options:

• Transaction Type: Select outward if you are a consignment provider and inward if you are a consignment recipient.
• Sub Type: Choose a sub kind based on the type of transaction.
• SKD stands for Semi Knocked Down, while CKD stands for Complete Knocked Down.
• Document Type: This category includes papers such as invoices, bills, challans, credit notes, and bills of entry.
• Document No. : Enter the document/invoice number here.
• Document Date: Enter the document's date.
• From/To: This element must be completed depending on whether the person is a supplier or a beneficiary.

Enter URP in the GSTN box if the individual is not registered.

• Item Specifics: Enter the item's information, such as the Product name and Description.
• Quantity Unit Value/Taxable Value HSN Code
• CGST, SGST, or IGST tax rates ( percent )
• Cess tax rates ( percent )

While filing a return on the GST site, some entries in the GST Return might be auto-populated.

Transporter Specifications: This section contains the method of transportation (road/rail/ship/air), as well as the approximate distance, traveled (Kms).

Furthermore, any of the following information should be provided:

Transporter Name/Transporter ID/Transporter Doc No. & Date OR Vehicle No. in which consignment is carried (Format: AB12AB1234/AB12A1234 /AB121234/ABC1234)

In the event of frequently used items, clients/customers, suppliers, and transporters, the 'My masters' part of the login dashboard should be updated first.

Click "Submit" to finish submitting the e-way bill. Immediately, the details will be validated and highlighted. If there are no mistakes, the request is processed, and an e-way bill in Form EWB-01 with a 12-digit unique number is created.

After printing the e-way bill, the person responsible for conveying the items must take it with them.

Another step launched by the government to control the transportation of products between and between states is the E-way bill. Hopefully, the government will be able to complete all of its e-way bill projects.

When is an E-Way Bill not Required?

It is not essential to produce an e-Way Bill in the following situations:

• The mode of transportation is a non-motorized vehicle.
• Goods moved from a Customs port, airport, air cargo complex, or land customs station to an Inland Container Depot (ICD) or Container Freight Station (CFS) for Customs clearance.
• Goods carried under Customs control or with a Customs stamp
• Goods carried under Customs Bond from the ICD to the Customs port or from one customs station to another.
• Cargo moved to or from Nepal or Bhutan in transit
• Goods movement generated by defense formations under the Ministry of Defence as a consignor or consignee
• Empty Cargo containers are being transported Consignor delivering goods to or from a weighbridge for weighment at a distance of 20 kilometers, escorted by a Delivery challan
• Goods are delivered by rail if the consignor is the Central Government, a state government, or a municipal government.
• Goods listed in the various State/Union territory GST Rules as exempt from E-Way bill requirements.
• Transportation of certain specified commodities- Includes a list of exempt supplies of goods, an annexure to Rule 138(14), items considered as no supply under Schedule III, and a schedule to Central Tax Rate notifications. (List of Goods in PDF format).

Part B of the e-Way Bill does not need to be completed if the distance between the consigner or consignee and the transporter is less than 50 kilometers. It is also if the transport is within the same state.

FAQs

1.What steps should be taken if the e-way bill's validity expires?

If the e-way bill expires, the products cannot be moved any further. However, the commissioner of state may prolong the validity at his discretion. The method for this will be communicated later.

2.Is there a backup available in the portal if the invoices are accidentally deleted?

The e-way bill will be accessible through the GST portal. The same may be checked against the trader's GSTIN.

3.Is it possible to produce an e-way bill for a free sample/product?

So. Yes, an e-way bill can be produced for a free sample or goods. Simply type "Zero" in the quantity and value fields.

4.How many e-way bills should be created if two consignments with values of 50,000 INR and more are carried using the same LR Number?

When the value of the shipment exceeds 50,000 INR, an e-way bill must be generated. However, a person may also produce an e-way bill for 50,000 INR.

5.What is the transporter's obligation and liability under the E-Way bill system?

Transporters transporting products by road, air, rail, and other modes of transportation must also issue an e Way Bill if the supplier has not generated one for whatever reason.

Create an e-way bill based on the information provided by the suppliers/consignors regarding the invoice/challan.

For further information, see our article on 'Transporter Compliance with e-Way Bills.'

If the transporter fails to generate in the aforementioned conditions when necessary, he may face a penalty of Rs 10,000 or the tax attempted to be avoided (whichever is bigger), whichever is greater, as well as confiscation of goods and seizure of the vehicle.

Summing Up

E-way bills are a technique for ensuring that products being carried conform with the GST Law. They are an excellent instrument for tracking the flow of commodities and detecting tax fraud.

If you're ready to tackle GST and its components, the E-way bill is your ticket to the next level. We hope that this article has improved your understanding of the E-way bill's features and creation process.

If you found this blog useful, or if there was something we missed that you'd want to learn more about, please let us know in the comments section below.