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Under the GST regime, for quick and easy movement of goods within states in India without any hindrance, all the check posts across the country are abolished. However, in order to monitor the movement of goods for controlling any tax evasion, e-way bill system has been introduced – for inter-State movement of goods with effect from 01.04.2018 and for Intra- State movement of goods in a phased manner. This article describes the E-Way Bill System under GST.
Under this system, a registered taxable person prior to movement of goods via a conveyance would inform each transaction’s details to the tax department. After this, you will obtain an acknowledgement number for having thus informed, and then use this acknowledgement number as a valid document accompanying the conveyance carrying goods. The idea is that the taxpayer is made to upload the details of each transaction to a common portal through the Internet, and once uploaded; the common portal would automatically generate a document which can be tracked and verified easily by any concerned persons.
An Electronic Way Bill (E-Way Bill) is a receipt or a document issued by a registered person giving details and instructions relating to the movement of goods and details include the name of the consignor, consignee, the point of origin of consignment, its destination, and route.
E-Way Bill is 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. In other words, E-Way Bill is an electronic document generated on the GST portal evidencing movement of goods.
The Pre-requisite for the generation of E-Way Bill is that the person who generates E-Way Bill should be a registered person on GST Portal and he should register on the E-Way Bill portal.
If the Transporter is not a registered person under GST, it is mandatory for him to get enrolled on E-Way Bill portal generation of the E-Way Bill.
Whenever there is a movement of goods of consignment value exceeding Rs. 50,000:
The registered person causing such movement of goods shall furnish the information relating to the said goods as specified in Part A of Form GST EWB-01 before the commencement of such movement.
If the supplier is registered and undertakes to transport the goods, movement of goods is caused by the supplier. If the recipient arranges transport, the movement is caused by him. If goods are supplied by an unregistered supplier to a registered known recipient, the movement shall be caused by such recipient
It is important to note that “information is to be furnished prior to the commencement of movement of goods” and is to be issued whether the movement is in relation to supply or for reasons other than supply. In many cases, goods transit through another State while moving from one area in a State to another area in the same State.
It is important to note that E-way bill generation is not dependent on whether a supply is inter-State or not, but on whether the movement of goods is inter-State or not. Therefore, if the goods transit through a second State while moving from one place in a State to another place in the same State, an e-way bill is required to be generated [Circular No. 47/21/2018 GST dated 08.06.2018]
Consignment value of goods shall be the value:
As discussed, in case of movement of goods for reasons other than supply, the movement is occasioned by means of delivery challan which has necessarily contained the value of goods. The value given in the delivery challan should be adopted in the E-Way Bill
The answer to the above question is yes. In the following situation even if the value of consignment is less than Rs50000, E-Way Bill will be required:
Where goods are sent by a principal located in one State or Union territory to a job worker located in any other State or Union territory, the e-way bill shall be generated either by the principal or the job worker, if registered, irrespective of the value of the consignment [Third proviso to rule 138(1)].
Where handicraft goods are transported from one state or union territory to another state or union territory by a person who has been exempted from the requirement of obtaining registration, the E-Way Bill shall be generated by the said person irrespective of the value of the consignment.
E-Way Bill in case of ‘Bill to Ship to ‘Model
In this model of supply, there are three persons involved in a transaction, namely:
‘A’ is the person who has ordered ‘B’ to send goods directly to ‘C’
‘B’ is the person who is sending goods directly to ‘C’ on behalf of ‘A’
‘C’ is the recipient of goods
In the complete scenario, two suppliers are involved and accordingly, two tax invoices are required to be issued:
Invoice 1 which would be issued by ‘B’ to ‘A’.
Invoice-2 which would be issued by ‘A’ to ‘C’
It is clarified that as per the CGST Rules 2017[1], either A or B can generate the E-Way Bill but it may be noted that only one E-Way Bill will be generated.
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Soniya is a dedicated legal professional with a flair for reading & writing to keep herself updated with the latest economical developments. She has worked on projects related to IPR & Corporate laws which have given her diversity in work and a chance to blend her subject knowledge with its real-time implementation, thus enhancing her skills.
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