There have been some concerns regarding the collections of revenue under the GST regime. Where the collection of tax in July was Rs 94,000 crore, in October it was Rs 83,346 crores to Rs 80,808 crores in November. This primarily has been due to the rate cuts in tax of around couple of hundred items.

Government is positive that the collection would increase as and when the compliance of the Act increases. Finance minister Mr Arun Jaitely recently said that once the anti-evasion measures are put in place the compliance will increase and so will the collection.

One such major step is E way bill. Electronic Way Bill (E-Way Bill) is a receipt or a document issued by a carrier giving details and instructions relating to the shipment of a consignment of goods and the details include name of consignor, consignee, the   point   of   origin   of   the   consignment, its destination, and route.

Legal provisions relating to E way bill

Chapter XVI and rule 138 of CGST Rules lay down the procedure and other legal provisions regarding the E Way bill.

As per the rule 138:

Every registered person who causes movement of goods of consignment value exceeding fifty thousand rupees—

  • in relation to a supply; or
  • for reasons other than supply; or
  • due to inward supply from an unregistered person,

shall, before commencement of such movement, furnish information relating to the said  goods in Part A of FORM GST EWB-01, electronically, on the common portal.

As it is apparent from the language of rule 138 the E-way bill is required to be generated on the movement of the goods whether in relation to supply or otherwise.

Reading of section 31 and 143 of CGST Act provides us cases where goods are required to be moved before the supply of goods takes place. For example:

1. In case of continuous supply of goods

2. In case of goods been sent or approval for sale or return.

3. In case of goods sent for Job work.

In following cases E way shall be required to be generated even if the value of goods being transported is below Rs 50,000/-

1. Where goods are sent by principal located in one state to a job worker located in another state.

2. Where the goods transported from one state to another state are covered by the expression “handicraft goods” as notified by the Government of India

3. Where the goods are transported by unregistered dealer and the recipient is a registered dealer. Where the goods are supplied by an unregistered supplier to a recipient who is registered, the movement shall be said to be caused by such recipient if the recipient is known at the time of commencement of the movement of goods.

Any transporter transferring goods from one conveyance to another in the course of transit shall, before such transfer and further movement of goods, update the details of conveyance in the e-way bill on the common portal.

Validity of E-way bill

Distance Validity
Upto 100 km One day
For every 100 km thereof thereafter One additional day

For an example:

Distance Validity
100 km Day 1
150 km Day 2
200 km Day 2
250 km Day 3
300 km Day 3

Its worth noting here that where an e-way bill has been generated under this rule, but goods are either not transported or are not transported as per the details furnished in the e-way bill, the e-way bill may be cancelled electronically on the common portal, either directly or through a 96 Facilitation Centre notified by the Commissioner, within 24 hours of generation of the E-way bill.

Exemption from E-Way bill

In following cases no E-way bill is required to be generated:

1. where the goods are being transported by a non-motorised conveyance

2. where the goods being transported are specified under sub rule 14 of rule 138

3. where the goods are being transported from the port, airport, air cargo complex and land customs station to an inland container depot or a container freight station for clearance by Customs;

4. in respect of movement of goods within such areas as are notified

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Author Bio

Qualification: CA in Practice
Company: SAMP & Co.
Location: Delhi, New Delhi, IN
Member Since: 06 Feb 2018 | Total Posts: 2

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2 responses to “E-Way Bill- Legal provisions, Validity and Exemption”

  1. S. Radhakrishnan says:

    I read your article, you have replicated what is been on the web, expected to know something more, going through the ” Heading”.
    The important change on the introduction of EWB through the common portal is this has done away with E1 transaction.

    • samp_mayank says:

      Thank you for reading my article and replying on it. In this article i have tried to summarize the provision of E-Way bill and the logic behind it ,in a very basic language without going into specifications. E1 sales and other issues need a whole new article.

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