E-Way bill notifications

The GST Council in its 22nd meeting held on 6th October, 2017 had decided and recommended that the e-way bill under GST shall be introduced in a staggered manner with effect from 1st of January, 2018, and will be fully rolled out nationwide from the 1st of April, 2018. In other words, the implementation of the e-way bill was deferred till March 2018, so as to give businesses more time to get acclimatized to the various changes brought in by the GST era. However, at the recently concluded 24th GST council meeting held on the 16th of December, 2017, the GST Council members have sprung a surprise at the business community by announcing the e-way bill notification, to be live from the 1st of February, 2018, two months ahead of the earlier plan.

What we already know about the e-way bill?

Under GST, transporting goods worth more than INR 50,000 within or outside a State will require an electronic-way or e-way bill via prior online registration of the consignment. To generate an e-way bill, the supplier and transporter will have to upload details on the GST portal, post which a unique e-way bill number (EBN) will be made available to the supplier, the recipient and the transporter on the common portal.

Why has the e-way bill been preponed?

The e-way bill GST provisions had primarily targeted a single national level e-way bill, which could be used by suppliers and transporters all across the country. Till such time as this national e-way bill was ready, the States were authorized to continue their own separate e-way bill systems. However the GST Council received several representations from the trade and transporter communities, stating that this was causing an unnecessary bottleneck to the inter-State movement of goods, prompting the need for an earlier implementation of the e-way bill. Another reason could be the fall in the GST revenue collections in the months of October and November, much of which was attributed to tax evasion, resulting from the absence of a strong mechanism to monitor inter-State supplies. As a result the GST Council, reviewed the readiness of the requisite hardware and software required for the nationwide rollout of e-way bill, and has announced the renewed date, post discussions with all the States.

Major e-way bill notifications under GST

The major GST recommendations with regards to the e-way bill notifications are as follows:

• The nationwide e-way bill system will be rolled out on a trial basis, latest by 16th January, 2018, post which traders and transporters can start using this system on a voluntary basis.
• The detailed rules for implementation of the nationwide e-way bill system for inter-State movement of goods on a compulsory basis will be notified with effect from 1st February, 2018.
• While the system to generate both inter-State and intra-State e-way bill will be ready by 16th January, 2018, the States may choose their own timings for implementation of e-way bill for intra-State movement of goods on any date before 1st June, 2018. However, since there are certain States which are already having a system of e-way bill for intra-State as well as inter-State movement of goods, they may be expected to be the early adopters of the national e-way bill system for intra-State movement also.
• The final deadline to implement the uniform system of e-way bill for inter-State as well as intra-State movement across the country will be, the 1st of June, 2018.

Basis	Inter-State	Intra-State
Voluntary E-way bill Implementation Starts	16-1-2018	16-1-2018
Compulsory E-way bill Implementation Starts	1-2-2018	No Fixed Date. States can choose to implement any date before 1-6-2018
Final Deadline for E-way bill Implementation	1-6-2018	1-6-2018

While the e-way bill has been conceptualized looking at the larger picture of reduction in tax evasion, seamless inter-State transportation of goods and minimal loss of time at check-points, it has to be ably supported by a robust implementation. To begin with, further clarity about the applicability of e-way bill on supplies exempt from GST is awaited from the GST Council. Also, care should be taken that the compulsory introduction of e-way bill, 2 months in advance, does not become a problem for businesses engaged in inter-State supplies.

In conclusion, given that the implementation is taken care of, the e-way bill in its new avatar could prove to be a strong mechanism to make the taxpayer accountable in the absence of the invoice matching mechanism, which is currently postponed. The faster all the States accept and implement the e-way bill system, the faster will the entire country be able to walk towards a national uniform e-way bill process, which will be extremely beneficial for all inter-State suppliers.