Everything you need to know about E-Way Bill Generation, Regulations and Compliance

The e-way bill is an electronically produced document that must be generated by businesses in India, while moving goods worth more than ₹ 50,000 from one location to another. Every e-way bill must include detailed information about the goods being transported.

Along with that, the e-way bill can be created or cancelled through SMS, android app, and via site-to-site API integration. After generating an e-way bill a unique E-Way Bill Number (EBN) is allocated and is available to the manufacturer, the receiver and the transporter.

Integration of e-way bill with VAHAN system

The e-way bill portal is now connected with the VAHAN network in February 2020. In Karnataka state, a pilot run has already begun. Now, at the time of the e-way bill generation, the vehicle registration number will be validated.

When e-way bill is issued?

E-way bill will be electronically generated when the movement of goods of value exceeds ₹ 50,000 from one place to another place anywhere in India.

• In relation to a ‘supply’
• For reasons other than a ‘supply’(Send for job work)
• Due to inward ‘supply’ from an unregistered person (purchase from unregistered person)

Who will generate an e-way bill?

Registered Individual – E-way bill must be generated electronically when the transfer of goods to or from an unregistered person is greater than ₹ 50,000 in value. Even if the value of goods is less than ₹ 50,000, a registered person or the transporter can generate and carry the e-way bill.

Unregistered Individuals- Unregistered persons are also required to generate an e-way bill. If an unregistered person makes a supply to a registered person, the recipient would have to ensure that all the compliances are met as if they were the supplier.

Transporter – Transporters transporting goods by road, air, rail, etc. also need to generate an e-way bill if there is no e-way bill generated from the supplier or buyer side.

What are the benefits of having an e-way bill?

The government expects many benefits from the new e-way bill program.

• The old method of inspectors checking on with those carrying goods is paving way to a modern digital interfacing program, leading to the removal of state boundary checkpoints.
• Eventually, the digital interface system can enable the quicker movement of goods, boost truck processing times and benefit the logistics industry by allowing the average distances travelled to increase. Both of those benefits would reduce travel time and travel costs.
• The biggest advantage of the new e-way billing system is its usage as an effective tracking device for the government to check for tax evasion.

What are the documents required for the generation of an e-way bill?

In order to produce an e-way bill, the consignor should provide with the following information:

• Challan invoice, supplier bill or delivery challan
• Transporter ID (if transported by road)
• Vehicle number
• Record number and date of transportation (if transported by rail, air or water vessel)

What are the challenges under e-way bill system?

It is expected the latest e-way billing system will face several challenges which are as follows:

• Analysts explain that as the different states have been given the power to implement their own e-way bill rules; in that case, if different states prepare different rules from each other then no uniformity within the system would be available.
• Because the entire e-way billing system will depend on technology, all transport could come to a standstill if, or when, technical failures arise. Government and companies have already faced technological breakdowns with the e-way bill system, leading to deferment of the introduction of the e-way bill.
• Finally, there are many smaller companies that transport goods that may not be tech-savvy and therefore may find it challenging to abide by the provisions on e-way billing.

What is the validity of an e-way bill?

What are the circumstances when you don’t need an e-way bill?

There is no need to generate e-Way bill in the following cases:

• The mode of transportation is a non-motor vehicle
• Goods transported from Customs Port, Airport, Air Cargo Complex or Land Customs Station to Inland Container Depot (ICD) or Container Freight Station (CFS) for Customs clearance.
• Goods transported under customs oversight or under customs seal Goods transported from IC under customs bond
• Goods transported from ICD to Customs Terminal or from one customs station to another, under Customs Bond.
• Transit cargo transported to or from Nepal or Bhutan
• Goods transported under Customs Bond from ICD to Customs
• Port or from one customs station to another are transported by defence creation under the Ministry of Defence as a consignor or consignee
• If empty Cargo containers are being transported.
• Consignor delivering goods at a distance of 20 km to or from the place of business and a weighbridge for weighing, accompanied by a Transfer challan.
• Goods are transported by rail where the Consignor is the Central Government, State Governments or a Local Authority.
• Goods specified in GST Rules of the respective State/Union territory as exempt from the requirements of the E-Way bill.
• Liquefied petroleum gas for supply to household and non-domestic exempted category customers
• Kerosene oil sold under PDS
• Postal baggage transported by Department of Posts
• Jewellery, goldsmiths’ and silversmiths’ wares and other articles
• Used personal and household effects
• Goods, other than de-oiled cake, being transported are specified in notification No. 2/2017 – Central tax (Rate) dated the 28th June, 2017. Few of the goods that are included in the above notification are as follows:
• Goods being transported are not treated as supply under Schedule III of the Act,

The road ahead

While it does have its benefits, the e-way bill is just another challenge to handle for some of the small businesses. The latest technological trends such as automation and cloud will help lighten any strain related to the e-way bill compliance.