In the complexity of India's taxation system, staying up-to-date with the latest regulations is crucial, especially for tax professionals, accountants, and chartered accountants (CAs). One such key element is the Eway Bill, which has restructured the field of logistics. We clarify the complexities surrounding the Eway Bill in this thorough guide by going over its fundamentals, creation procedure, regulations, and everything in between.
What Is An Eway Bill?
The Eway Bill, or Electronic Way Bill is an electronic document required for the movement of goods valued at over INR 50,000 within India. It serves as a digital permit to ensure seamless transportation while allowing authorities to monitor and regulate the movement of goods. The Eway Bill, generated electronically, contains crucial information about the consignment, including its origin, destination, and route.
When To Generate?
Knowing when to generate an Eway Bill is important for businesses moving goods. Let's classify in simple terms.
1. When the Value Crosses Rs. 50,000
The Eway Bill kicks in when you're moving goods, and the total value is more than Rs. 50,000. This could be for each invoice or the sum of all invoices in a single vehicle.
- For Any 'Supply': If you're moving goods because of a sale, return, or any other transaction (what we call a 'supply'), and it's worth more than Rs. 50,000, you need an Eway Bill.
- Non-Supply Movements: Even if you're moving goods for reasons other than a direct sale (like returns), an Eway Bill is required if the value is over Rs. 50,000.
- Goods from Unregistered Person: If you're receiving goods from someone not registered for GST, and the value surpasses Rs. 50,000, you still need an Eway Bill.
2. Understanding the Above Case 'Supply'
'Supply' covers different scenarios:
- Regular Business Transactions: The usual buying and selling where money is involved – that's a 'supply.'
- Business-Like Transactions Outside Regular Business: Even if it's not your typical business deal but money is still part of the picture, it's a 'supply.'
- Exchange Without Money: If you're swapping goods without money changing hands (like bartering), that counts as a 'supply.'
3. Special Cases Requiring Eway Bill, No Matter the Value
Certain goods need an Eway Bill, even if they're less than Rs. 50,000:
- Sending Goods to a Job-Worker in Another State: If you're the boss sending things to an assistant in another state, you need an Eway Bill, regardless of the value.
- Handicraft Goods Moving Between States: If you're a crafty seller moving goods to another state and you don't have to register for GST, an Eway Bill is a must, no matter the value.
Understanding these simple rules helps keep your goods moving smoothly. Following them ensures your business stays on the right side of the law and avoids unnecessary hiccups in transportation. So, remember – when moving goods, know when to Eway Bill!
Also Read: e-Invoice Limit for Indian Taxpayers
Who Should Generate An Eway Bill?
Both transporters and businesses need to know who is in charge of creating an Eway Bill. Let's break it down in straightforward terms.
1. Registered Person
- When to Generate: A registered person must generate an Eway Bill when moving goods worth more than Rs 50,000 to or from another registered person.
- Optional for Lower Value: Even if the value of the goods is less than Rs 50,000, a registered person or the transporter can still choose to generate and carry an Eway Bill.
2. Unregistered Persons
- Requirement for Eway Bill: Unregistered persons are also required to generate an Eway Bill when moving goods.
- Compliance Responsibility: If an unregistered person supplies goods to a registered person, the receiver (registered person) takes on the responsibility of ensuring all compliance measures are met as if they were the supplier.
3. Transporter
- When to Generate: Transporters carrying goods by road, air, rail, etc., need to generate an Eway Bill if the supplier hasn't generated one.
- Exemption for Low-Value Consignments: However, transporters don't need to generate an Eway Bill (as Form EWB-01 or EWB-02) if each consignment is individually less than or equal to Rs 50,000. The exemption doesn't apply when the aggregate value of all documents put together exceeds Rs 50,000.
- Documents: When we say "document," we mean a Tax Invoice, Delivery Challan, or Bill of Supply.
Unregistered Transporters
- Enrollment Process: Unregistered transporters can enroll on the Eway Bill portal to receive a Transporter ID.
- Generating Eway Bills: Once enrolled, unregistered transporters can generate Eway Bills for the goods they transport.
Also Read: Understanding e-Invoicing Under GST: Applicability, Limits & Implementation Date
Cases When Eway Bill Is Not Required
In certain situations, the eWay Bill is not required, even though it is an essential document for the transportation of goods. In order to clarify the situations in which an eWay Bill is not necessary, let's examine these cases.
1. Non-Motor Vehicle Transport
When It Applies: If the goods are being transported using a non-motor vehicle, an eWay Bill is not necessary.
2. Customs Clearance Movements
Scenario: 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.
3. Customs Supervision or Seal
Situation: Goods being transported under Customs supervision or with customs seals.
4. Customs Bonded Movements
Circumstances: Goods moved from an ICD to a customs port or between customs stations under a customs bond.
5. Transit Cargo to Nepal or Bhutan
When Applicable: Movement of goods to or from Nepal or Bhutan under transit cargo.
6. Defense Formation Movements
In Cases Involving: Movement of goods by defense formations under the Ministry of Defence, whether as a consignor or consignee.
7. Empty Cargo Container Transport
Situation: When empty cargo containers are being transported.
8. Weighment at a Distance of 20 kms
Scenario: When the consignor is transporting goods to or from their place of business to a weighbridge for weighment, and the distance is within 20 kms. This must be accompanied by a Delivery Challan.
9. Government Consignor by Rail
Applicability: Goods being transported by rail where the consignor is the Central Government, State Governments, or a local authority.
10. Exemptions as per State/Union Territory GST Rules
Goods Exempted: Goods specified as exempt from e-Way Bill requirements as per the respective State/Union Territory GST Rules.
11. Transport of Specified Goods
Including: Exempt supply of goods, Annexure to Rule 138(14), goods treated as no supply as per Schedule III, and certain items mentioned in Central tax Rate notifications.
By being aware of these scenarios, businesses and transporters can determine when an eWay Bill is not required, which saves time and guarantees compliance with relevant laws. Always be mindful of the particular circumstances that, in certain situations, prevent you from creating an eWay Bill.
How to Generate Eway Bill
The process of generating an Eway Bill involves a few straightforward steps:
- Login: Log in to the Eway Bill portal using your credentials.
- Form Entry: Fill in the required details such as invoice number, date, recipient details, and item details.
- Document Upload: Attach supporting documents like the invoice, bill of supply, or delivery challan.
- Vehicle Details: Enter information about the mode of transportation and vehicle number.
- Submit: After thorough verification, submit the details to generate the Eway Bill.
Validity of Eway Bill
The validity of an Eway Bill is determined by the distance covered by the goods in transit. Here's the breakdown: For every 100 kilometers or portion of it, a one-day validity period has been provided for regular vehicle or transportation modes. Additionally, a one-day validity is given for every 20 kilometers or portion of the movement in the case of over-dimensional cargo vehicles. Also, this validity ends at midnight on the last day.
Documents Required
To generate an Eway Bill, certain documents are essential:
- Invoice or Bill of Supply: A document specifying the details of the goods being transported.
- Transporter ID: For those cases where the transporter is generating the Eway Bill.
- Vehicle Details: Information about the mode of transportation and vehicle number.
