Electronic Invoice (e-Invoice) has been recently introduced by the GST Council and will apply to taxpayers in a phased manner. Because of this, there have been few changes made to the existing GST system to simplify and reduce the burden of compliance on the taxpayers. In this article, we will discuss the changes in the E-Way Bill system and the associated procedures.
Section 68 of the CGST Act 2017 read with Rule 138 of the CGST Rules, 2017 mandates that any person in charge of transporting any consignment of goods with a value greater than INR 50,000, is required to carry a document called “E-Way Bill”.
It is generated on the E-Way Bill portal by the registered persons or transporters who cause movement of goods of consignment, before the commencement of such movement. An E-Way Bill is mandatory for inter-state as well as intra-state movement of goods. In most instances, it is the supplier who creates the E-Way Bill. However, the recipient or transporter may also generate it provided they are registered under GST.
E-Way Bill (EWB) is used as a tool by the Government to check tax evasion. Non-compliance with EWB rules may lead to penalties and confiscation of goods by the Tax Authority.
An E-Way Bill consists of two parts. Part A mainly includes GSTIN of both parties, invoice number, HSN codes, delivery address etc. and Part B includes transporter details, vehicle number etc. Under the current system, both parts are manually filled by the taxpayer on the E-Way Bill portal.
However, with the new system in place, E-Way Bills will be auto-populated based on the details available in the documents reported* to the Invoice Registration Portal (IRP). The taxpayers will only have to enter the transporter details (Part B). This will increase the accuracy of the E-Way Bills generated and reduce manual errors.
*Businesses with a turnover more than INR 500 crores have to report invoices to the IRP in the notified format to get an Invoice Reference Number (IRN) from 1 October 2020.
Note: If the taxpayers do not file their GST returns for two or more consecutive filing periods, then, the E-Way Bill generation will be blocked till the outstanding GST returns are filed.
Step 1: Log in to the e-Invoice portal and go to ‘E-Way Bill’ > ‘Generate E-Way Bill’.
Step 2: Select and enter the ‘Ack No.’ or ‘IRN’ or ‘Date of e-Invoice’ and click on ‘Go’.
The system will display the Part A of the EWB and prompt to enter the details of transportation under ‘e-Waybill Details’.
Step 3: Enter the transporter name, transporter ID and approximate distance (KMS) to be covered by the shipment.
In most of the cases, the e-waybill system will automatically calculate and display the estimated distance between the supplier and recipient addresses as per the PIN codes entered in the e-Invoice. However, as mentioned above, taxpayers can enter the actual distance manually as well. If the PIN codes of source and destination of the shipment are the same, then, users can enter a maximum distance of 100 KMS in the field.
Step 4: Enter the ‘Vehicle number’ and ‘Transporter Doc. No.’ and click on ‘Save’. The system validates the details entered, and a unique 12-digit E-Way Bill number is generated. In case there is an error, a message will pop up on the screen.
Step 5: Once an E-Way Bill is generated, it can be saved in PDF/JSON format.
Since the E-Invoicing system is linked to E-Way Bill generation, any errors in the e-Invoice can lead to errors in the E-Way Bill generated. The EWB generated can be cancelled only within 24 hours of generation. Taxpayers must note that E-Way Bills must be cancelled first and then the e-Invoice/IRN can be cancelled. An EWB cannot be generated for a cancelled IRN.
- Existing taxpayers who have their E-Way Bill login credentials can use the same to log in to the E-Invoicing system.
- Section 12 of the e-Invoice schema asks for EWB details.
- Currently, the E-Way Bill and IRN systems are running independently. This is expected to integrate in a phased manner.
- Through the e-Invoicing portal, taxpayers can:
- Generate E-Way Bills through IRN
- Generate EWB in bulk
- Print E-Way Bills
- E-Way Bill can be generated only for invoices and not for credit and debit notes.
- There may be certain types of transactions like job work, sales returns, etc., which requires an E-Way Bill. E-Invoicing does not cover these transactions yet. Hence, the EWB will have to be generated under the existing system with other supporting documents.
- The regular E-Way Bill generation process will continue along with the additional facility of generating E-Way Bills through IRN.
- The validity of the E-Way Bill can be extended if the consignment has not reached the destination within the validity period due to exceptional circumstances like natural calamity, law and order issues, shipment delay, accident of conveyance, etc. The transporter has to explain the reason in detail while requesting for an