An integral part of achieving the ‘no tax evasion’ objective of the goods & services tax (GST) has been the prescription of a requirement for e-way bill (electronic-way bill). Akin to the pre-GST regime requirement of state permits for movement of goods into various states, the
GST law has also contemplated a requirement of a document, e-way bill, for any movement of goods exceeding a consignment value of Rs 50,000. While the requirement of a document for movement has been inherited in the GST regime, the mechanics/technicalities have been significantly reformed with modifications like uniformity in the document for movement/entry into any state, primary liability in most cases being that of the supplier vis-à-vis the earlier recipient liability, requirement for all movement of goods irrespective of supply or not, etc.
The e-way bill requirement was originally slated for February 1 this year, but owing to the heavy load/technical glitches, the portal crashed within hours of its launch. To address the same, the government deferred the launch of the e-way bill system, citing technical glitches as the reason for such rescheduling. After well-assuring the stability of the system and adequate dry run, the government proposed a phased launch of the e-way bill system from April 1; with e-way bill being mandated only for interstate movements from April 1 and staggered launch for intrastate movements commencing with Andhra Pradesh, Gujarat, Kerala, Telangana and Uttar Pradesh from April 15.
Owing to the phased implementation and bolstering of the IT infrastructure for handling a higher load, the relaunch of the system has ensured upkeep of the government’s promise of a stabilised and centralised system for generation of e-way bills. Also, initiatives of the government to explain the technicalities of the e-way-bill-related rules including amendments to the rules for catering business requirements, creation of a central help-desk with 100 people exclusively to deal with queries related to e-way bills and state help-desks in local language are worthwhile to applaud.
While clarity on various issues has been provided through FAQs by the government like remedies for non-configured vehicle number formats, consignment refusal by a customer, bill-from dispatch-from scenarios, movement in SKD/CKD form, etc, some issues remain unclear, entailing apprehensions of unwarranted detention and requirement of bank guarantee by businesses. Of the various open issues, a significant area of concern has been on the mechanics of e-way bill generation in case of bill to ship to transactions—where while the goods are billed to ‘X’, the same may be shipped to either ‘Y’ or a different location of ‘X’. There is ambiguity on whether such movements would require issuing two e-way bills, i.e. by the shipping party as well as the bill to party.
Given that there is a single movement, the industry while seems to be inclined to a one e-way bill requirement, a different opinion by the revenue authorities could entail unnecessary hassles for businesses. Also, one e-way bill issuance would need to be included as a reconciliation item by the ‘bill to’ party on account of a mismatch between the e-way bill report and GSTR-1. A clarity on the said issue with prescription of a one e-way bill requirement would annul apprehensions of businesses, and also address issues like margins of the bill to party getting disclosed to the first seller and delay in shipments on account of lead time for obtaining e-way bills from the ‘bill to’ party.
Further, while FAQs explicitly clarified the mechanics for generation of e-way bills in SKD/CKD forms, technicalities for movement of consignments of a single invoice in multiple conveyances is still awaited. A clarity on the said issue could bring about uniformity in practices and deter any unwarranted hassles by GST officers.
E-way-bill-related rules contemplate deemed acceptance of a consignment by a recipient, where he does not communicate his acceptance or rejection within 72 hours of the details being made available to him or time of delivery of goods, whichever is earlier. While there is a provision for deemed acceptance in case of non-communication of a response, the same could become tedious where at the time of audits/inspection, businesses are required to provide a reconciliation of e-way bills generated for delivery to them and actual receipt of goods.
While the requirement of communicating a response for each consignment received by a business is in itself distressing, communicating a response before actual receipt of goods (where the delivery time is more than 72 hours) with no option of modifying the same is practically challenging.
Also, while the law provides for an option for cancelling an e-way bill generated for reasons like non-transportation or incorrect details, it is only allowed for a period of 24 hours from the generation of the e-way bill. The said provisions fail to address practical business scenarios, where a shipment may be cancelled on account of order cancellation by a customer after 24 hours of scheduled movement of goods, etc. While such cases could be reconciled and explained to the revenue authorities, any irrational action by lower-level authorities of not accepting such reconciliation with related demand notices could entail unwarranted harassment for businesses.
While these technical issues could be resolved with appropriate clarifications being issued by the government, given the significance of pragmatism in this compliance, there is a need for upholding the letter and spirit of e-way-bill-related rules by ground-level authorities.
Actions like interception and detaining of a vehicle for more than 30 minutes, recurrent stopping of vehicles for physical verification without intelligence, unnecessary hassles to the torch-bearers of business (the logistics industry), impeding movements, and imposing penalty for difference in opinion on consignment values, especially cases where the e-way bill has not been generated for movements on delivery challan and the value is declared at less than Rs 50,000, etc, could lead to a catastrophe for businesses.
While the efforts of the government to achieve the ‘one nation, one tax’ objective through standardisation of e-way bill for the entire country is appreciable, the performance of the IT infrastructure post the full-fledged roll out of the e-way bill compliance would be critical to assess the true accomplishment of the objective.
Source: financialexpress.com