Introduction
Both Central and State
Governments have decided to implement GST from 1st July, 2017 in
place of excise, service, VAT, etc. The GST is said to be ‘One Nation One Tax’.
It is presumed under GST that there will be a free flow of inter-State trade
and commerce. One of the hurdles of levy of CST on inter-State transaction is
subsumed in GST to levy IGST with a benefit of ITC in receiving State. It was
also expected, that since IGST will be levied on each and every inter-state
supply, the check post and e-way bill provisions contained in various State VAT
Laws would be abolished. However, to the surprise of trade and industry, the
GST Act provides for “way bills” and detention, seizure and release of goods
and conveyance in transit and confiscation thereof, etc. The draft e-way
rules are also available in public domain. Although, it is not yet clear that
from which date the provisions of E-Way Bills will be effective and whether in
the same form or in a modified manner, in this article an attempt is made to
discuss provisions of draft e-way bills rules made available as on this day.
Information to be furnished prior to Movement of Goods (Rule
1)
Rule 1 provides for
furnishing of information prior to commencement of movement of goods and
generation of e-way bill. Accordingly, every registered person who causes
movement of goods of consignment value exceeding fifty thousand rupees;-
i) in relation to a supply:;or
ii) for
reasons other than supply; or
iii) due to
inward supply from an unregistered person, shall,
before commencement of movement of
goods, furnish information in Part A of Form GST INS-01.
The form is to be
furnished electronically, on the common GSTN portal.
Generation of E-way Bill by Registered Supplier/ Recipient
The e-way bill is
required to be generated for
transporting goods whether in his own conveyance or hired one and
registered supplier or recipient may generate e-way bill in form GST INS-1
after furnishing information in Part B of Form GST INS-01.
Generation of E-way Bill by Transporter
Where the e-way bill is
not generated as above and goods are handed over to a transporter, the
registered person has to furnish information relating to the transporter in Part
B of FORM GST INS-01. Then transporter shall generate e-way bill on the
basis of information furnished by registered person in Part A of FORM GST
INS-01.
Generation of E-way
Bill for consignment less than Rs. 50000/
It is mandatory to
generate e-way bill for transporting goods valuing more than Rs.50,000/-.
However, it is provided that the registered person or transporter may at his
option generate and carry the e-way bill even where the value of consignment is
less than Rs. 50,000/-.
Supply by unregistered person
Even an unregistered
person or transporter can generate e-way bill. However, under Explanation to
sub–rule 1, it is provided that where the goods are supplied by an unregistered
person to a registered recipient, the movement is deemed to be caused by such
recipient , if it is known at the time of commencement of movement of goods. As
a result of this explanation, in such cases the registered recipient has to
furnish the information and generate the e-way bill.
Unique E-Way bill
Number (EBN)
Upon generation of the
e-way bill on the common portal, a unique e-way bill number ( EBN) shall be
made available to the supplier, the recipient and the transporter on the common
portal.
Transfer of Goods
during Transit
Sub-rule (3) of rule 1
provides that when a transporter transfers goods from one conveyance to another
in the course of transit, he shall generate new e-way bill before such transfer
and further movement of goods specifying the mode of transport.
Multiple Consignments
In case of multiple
consignments in one conveyance, the transporter shall indicate the serial
number of e-way bills generated in respect of each such consignment and a consolidated
e-way bill in Form GST INS-2 shall be generated by him. Where the
consignor has not generated e-way bill and the value of consignment exceeds Rs.
50,000/-, then the transporter shall generate Form GST INS-01 on the basis of
invoice, bill or delivery challan, as the case may be, and also generate
consolidated e-way bill in Form GST INS-02.
Furnishing of Information
The information furnished
in Part A of Form GST INS-01 shall be made available to the registered
supplier on the common portal who may utilise the same for furnishing details
in return Form GSTR-1. In case of unregistered supplier the information
shall be furnished to him through his mobile number or e-mail, if available.
Cancellation of E-way
Bill
Sub-rule (6) to rule 1 provides for cancellation of e-way
bill when goods are either not transported or not transported as per details
given in e-way bill. The e-way bill can be cancelled either directly on GSTN or
through a Facilitation Centre notified by the Commissioner. However, the e-way
bill should be cancelled within 24 hours of its generation. But, it cannot be
cancelled once it is verified by the proper officer.
Validity of E Way-Bill
Sub rule (7) to rule 1
provides validity of e-way bills and form the relevant date as under;-
|
Sr. No.
|
Distance
|
Validity Period
|
|
1.
|
Less
than 100 km.
|
One
day
|
|
2.
|
100
km. or more but less than 300 km.
|
Three
Days
|
|
3.
|
300
km. or more but less than 500 km.
|
Five
Days
|
|
4.
|
500
km. or more but less than 1000 km.
|
Ten
Days
|
|
5.
|
100
km. or more but less than 300 km.
|
Fifteen
Days
|
The commissioner has the
power to extend the validity of e-way bill by notification for certain
categories of goods as may be specified therein.
The relevant date is
defined by way of explanation to the said sub-rule to mean that the date on
which the e-way bill is generated and the period of validity shall be counted
from the time at which it is generated.
Acceptance or
Rejection of Details of E-Way Bill by Recipient
The details of e-way bill
generated shall be made available to registered recipient of goods on common
GSTN portal. The recipient has to communicate acceptance or rejection of
consignment covered by the e-way bill. When he does not communicate his
acceptance or rejection within 72 hours of the communication to him on the
common portal, it is deemed that he has accepted the details. The facility of
generation and rejection of e-way bill may also be made available through SMS.
Documents and Devices to be carried by the Person In-charge
Rule 2 provides for
carrying of following documents and devices by the person in charge of a
conveyance;-
a) The
invoice or bill of supply or delivery challan, as the case may be,
b) A copy
of e-way bill or e-way bill number either physically or mapped to a Radio
Frequency Identification Device (RFID) embedded on to the conveyance in such
manner as may be notified by the Commissioner. The Commissioner may by
notification require the transporter to get the said device embedded on to the
conveyance and map the e-way bill to the RFID before movement of goods.
A registered person may
obtain an Invoice Reference Number by uploading a tax invoice issued by him in Form
GST-INV-1 and produce the same for verification by the proper officer in lieu
of the tax invoice. Such number shall be valid for a period of thirty days
from the date of uploading. When registered person uploads the invoice, the
information in Part A of Form GST INS-01 shall be auto populated on the
basis of the information furnished in Form GST INV-1.
The Commissioner may, by
notification, require the person in charge of conveyance to carry the following
documents instead of e-way bill;-
a) tax
invoice, or bill of supply or bill of entry; or
b) a delivery
challan, where the goods are transported other than by way of supply.
Verification of Documents and Con-veyance
Under rule 3, the
Commissioner or an authorised proper officer may intercept any conveyance to
verify the e-way bill or the e-way bill number in physical form for all intra
or inter-state movement of goods. The Commissioner shall get RFID readers
installed at a place where the verification of movement of goods is carried out
and it shall be verified through such RFID readers where the e-way bills are
mapped with RFID. However, where any information is received for tax evasion
then the authorised proper officer, after obtaining prior approval, physical verification
of conveyance can be carried.
Inspection and Verification of Goods
The proper officer shall
prepare summary report of every inspection of goods in transit and it shall be
recorded on line in Part A of Form GST INS-03 within twenty four hours of
inspection and final report in Part B of Form GST INS-03 shall be
recorded within three days of the inspection. It is also provided that where
the physical verification of goods being transported is done at one place
within the State or any other State, no further verification of the said
conveyance shall be carried out again in the State unless specific information
relating to evasion of tax is made available subsequently.
Facility of Uploading of Information of Detention of Vehicle
It is the policy of the
Government not to detain any vehicle for more than 30 minutes. Therefore, a
provision is made in sub-rule (5) for uploading details by transporter of
information of detention of vehicle for more than 30 minutes in Form GST
INS-04.
Other Miscellaneous
The provision for e-way
bill is applicable to all goods whether taxable or not. Even for transportation
of NIL rated goods also e–way bill is required.
The e-way is applicable
for transportation of goods by unregistered person including agriculturist. However,
in that case the recipient shall have to generate e-way bill if the
unregistered person has not generated it.
E-way bill is required
for each and every movement of goods whether in same city or in a State or
interstate. Also, it is required for movement of goods between the branch of
same person within or outside the State.
The term ‘conveyance’
defined in section 2 (34) of the Act to include a Vessel, an aircraft or
vehicle. Hence the e-way bill is required only when the goods are transported
through defined conveyance.
The term value is not
defined in the draft rule. So it should be transaction value of the goods
supplied by way of sale. In any other case, valuation rule may apply to
determine the value of goods. However, when the goods are supplied for
provision of services that is by way of hire then, no clarity is required to
take value of supply of service and not the value of goods itself.
In case of contravention
of provisions of e-way bill, the goods and vehicle carrying the goods can be
detained and confiscated u/s. 129 of the act. The goods can be released upon
payment of applicable tax and penalty equal to 100% of tax if owner comes
forward for release of goods. In case the owner does not come forward for
release of goods, the payment of tax and penalty equal to 50 % of value of goods is required for release of goods.
In case of exempt goods
for owner, the payment of two percent of value of goods or twenty five thousand
rupees whichever is lower is required to be paid for release of goods. If owner
does not come forward for release of exempted goods, the amount five percent of
goods is required to be paid for release of goods.The goods can be released
upon furnishing a security of the amount payable as provided herein above.
Conclusion
The rules for e-way bills
are not yet finalised. The discussion herein above is based upon draft rules
and it is subject to final rules made in this respect. It seems that an attempt
is being made to check evasion of tax and at the same time minimum interception
is proposed. In most cases, the checking will be made through electronic basis.
In GST, the thrust of the government is to have e-process and e-checking which
may serve the purpose in a better manner than human intervention, and, it may
also ensure free flow of movement of goods. It would have been desirable that
at initial stage the e-way bill provisions are made applicable to tax evasion
prone goods and thereafter made applicable to other goods. The trade,
transporters and industry must be given sufficient time to adjust and adapt the
new provisions of GST law and the e-environment.
