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Consequences of non-generation of eWay Bill

Updated on:  

08 min read

Eway bill is an electronically generated document mandatory, to be carried for movement of goods across India. It is necessary for the movement of goods worth more than Rs. 50,000 with some exceptions. A unique eway bill number (EBN) would be generated for each such consignment to be transported. The validity of this EBN depends on the distance of transportation of goods. To enforce this rule, authorized officers may be instructed to intercept any vehicle at certain check posts for the verification of necessary documents. Additionally, a physical verification of the vehicle may be carried out on receiving specific inputs regarding tax evasion.

Latest Updates

29th August 2021
From 1st May 2021 to 18th August 2021, the taxpayers will not face blocking of e-way bills for non-filing of GSTR-1 or GSTR-3B (two months or more for monthly filer and one quarter or more for QRMP taxpayers) for March 2021 to May 2021.

4th August 2021
Blocking of e-way bills due to non-filing of GSTR-3B resumes from 15th August 2021.

1st June 2021
1. The e-way bill portal, in its release notes, has clarified that a suspended GSTIN cannot generate an e-way bill. However, a suspended GSTIN as a recipient or as a transporter can get a generated e-way bill.
2. the mode of transport ‘Ship’ has now been updated to ‘Ship/Road cum Ship’ so that the user can enter a vehicle number where goods are initially moved by road and a bill of lading number and date for movement by ship. This will help in availing the ODC benefits for movement using ships and facilitate the updating of vehicle details as and when moved on road.

18th May 2021
The CBIC in Notification 15/2021-Central Tax has notified that the blocking of GSTINs for e-Way Bill generation is now considered only for the defaulting supplier’s GSTIN and not for the defaulting recipient or the transporter’s GSTIN.

17th March 2021
1. The e-way bills portal has released an update stating that e-way bills cannot be generated with only SAC codes (99) for services. There should be a minimum of one HSN code belonging to goods mentioned mandatorily.
2. Vehicle type ODC is provisioned for transport mode ‘Ship’.
3. Transporters are provided with a report of e-way bills based on the assigned date.

22nd December 2020
1. The CBIC increased the distance per day in case of goods transported through vehicles, other than the over-dimensional cargo, for determining the validity, as follows:
(a) It is one day – For a distance of up to 200 km as against earlier 100 km
(b) An additional day is taken- For every additional 200 km or part thereof, as against previously notified additional 100 km or part thereof
2. Regarding blocking of the e-way bill where a taxpayer fails to file GSTR-3B, the provision has been amended to replace two or more months with two or more tax periods. The same has been changed to include the quarterly return filers.

16th November 2020
1. According to Rule 138E (a) and (b) of the CGST Rules, 2017, the e-way bill generation facility of a taxpayer will be restricted, if the taxpayer fails to file their Form GSTR-3B returns or statement in Form GST CMP-08, for tax periods of two or more.
2. On 1st December 2020, the system will check the status of returns filed in Form GSTR-3B or the statements filed in Form GST CMP-08, for the class of taxpayers to whom it applies, and restrict the generation of e-way bill in case of:
(a) Non-filing of two or more returns in Form GSTR-3B for the months up to October 2020; and
(b) Non-filing of two or more statements in Form GST CMP-08 for the quarters up to July to September 2020
3. From 1st December 2020 onwards, blocking of e-way bill generation facilities would be made applicable to all taxpayers, irrespective of their Aggregate Annual Turnover (AATO), according to the terms of Rule 138E (a) and (b) of the CGST Rules, 2017.
4. The blocking will take place periodically from 1st December 2020 onwards.
5. To continue generating e-way bill on the e-way bill portal, taxpayers are advised to file their pending GSTR-3B returns/GST CMP-08 statements immediately.

Consequences of not carrying Eway bill

The consequences of not generating & carrying the EWay bill can result in both monetary and non-monetary losses to the taxpayer. Goods being moved in the contravention of Law are liable for:

  • Monetary Penalty

Moving goods without the cover of an invoice and Eway bill constitutes an offence and attracts a penalty of Rs.10,000 or the tax sought to be evaded (whichever is greater). Hence, the bare minimum penalty that is levied for not complying the rules is Rs. 10,000.

  • Detention and Seizure

The vehicle that is found to be transporting the goods without an Eway bill can be detained or seized and would be released only on payment of appropriate tax and penalty as specified by the officer. Under this, there could be two situations:

  1. If the owner wishes to pay the penalty, he must pay 100%  of the tax payable.
  2. If not, the penalty will be equal to 50% of the value of goods.

  Apart from the legal consequences mentioned above, it is also important to note that the vehicle, as well as the goods of the taxpayer, can be detained. This would mean that the taxpayer’s supply chain would get affected due to the long delays at the check posts. Therefore, Embarrassing and unproductive situations like these can be avoided by simply complying the rules. Start using Eway bill online portal, SMS facility, and ClearTax EWayBill software are readily available to simplify the whole process. It is advised that the taxpayers comply with the law to ensure smooth facilitation of goods from one state to another.

Frequently Asked Questions

What does the invoice value of Rs.50,000 include for calculating applicability of Eway bill?

The invoice value includes both the taxable amount plus the GST amount for calculating the applicability.

Is there any time gap for updating the Part A and Part B of the Eway bill?

On furnishing Part A of the Eway bill, a unique number shall be generated which shall be valid for 72 hours for updating the Part B of the Eway bill.

How many times can Part B of the Eway bill be updated?

There is no limit on the number of times it can be updated as long as it is within the period of validity. At any point of time, the vehicle details should match with the vehicle actually transporting the goods.

Can the goods be seized by the GST authorities even when it is accompanied by Tax Invoice and eway Bill, only on the ambiguity of classification of goods and Tax Tariff?

No. The rules do not lay down the circumstances or grounds of seizure or detention of vehicle. The understanding is that anything (concrete evidence) that causes suspicion to the proper officer about possible tax evasion can lead to seizing of the vehicle. Try ClearTax EWayBill Software that’s easy, accurate & smart! Makes compliance easy by overcoming all the Eway bill challenges through a seamless integration with your ERP system to generate Eway bills. It comes with several validations that prevent errors from occurring, provides intelligent insights that help you carry out business efficiently with minimal effort and many more.

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