EARLY ADOPTION OF E-WAY BILL IN THE GOODS AND SERVICES TAX REGIME

The Government of India has planned for early implementation of the electronic way bill (E-Way Bill) System with effect from 01.02.2018, which is an important element of the goods and services tax (GST) regime in India.

Meaning:

The E-Way Bill is a bill generated from the GST Network (GSTN) which is mandatory for every transporter to carry, for inter-state and intra-state transportation of goods worth more than Rs 50,000 within the country, except in certain cases. The E-Way Bill need not be generated in cases where goods being transported by a non-motorised conveyance; goods 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; and when Consignment value is less than Rs 50,000 among others.

Advantages to the Government:

This Bill is an evidence of the movement of goods, a tool to check that goods being transported comply with the GST Laws, and to check tax evasion.

Validity of the E-Way Bill:

The E-Way Bill once generated would be valid for one day (24 hours) and in exceptional cases, the Commissioner of GST may, upon expiry of the E-Way Bill, generate another E-Way Bill with the details of goods.

Early adoption of the System:

The decision to adopt the E-Way Bill System early may be as a result of the decline in GST revenue in the past few months.

Countrywide E-Way Bill trials:

The Government had conducted nationwide E-Way Bill trials on 16.01.2018. Various industry experts have expressed concern about whether the IT infrastructure would be able to support the large volumes of E-Way Bills generated in the GSTN.

Portal for E-Way Bill:

The National Informatics Centre (NIC), Government’s premier Science and Technology Organisation had created a specific portal (ewaybill.nic.in/) (Portal) to generate an E-Way Bill, which the transporter has to carry along with the invoice of the goods. Reportedly, the E-Way Bill System has been designed to handle around 50 lakhs E-Way Bills per day. The CEO of GSTN has clarified that such online data is protected and that such data is accessible only to the tax payer and the tax officer.

Possible fallouts:

This System may have some fallouts including connectivity issues in small towns, difficulty in operations in case of System/Portal disruption, understanding of such complex mechanism and compliances by small traders and transporters, etc.

Public Reaction:

Many companies and traders have reacted to the early adoption of E-Way Bill System in India stating that a number of businesses are apprehensive that the nationwide implementation of this System may lead to delays in transportation and arbitrary inspections of consignments by the mobile squads; that the Portal may not be able to handle the huge volumes of E-Way Bills generated and so the implementation should be delayed until the Portal works smoothly; that the Government may use quick response (QR) codes to validate the goods being transported instead of E-Way Bills, etc.

Moreover, a few companies have supported this move of the Government stating that the organized section of the long-distance logistics industry may contribute towards the rapid growth of the Indian economy.

Harini Daliparthy

Legal Associate