Summary: The introduction of GST across India is an effective step taken by the Indian Government. The main agenda behind this superlative initiative was to curb tax evasion. For this, solutions like e-way bills were introduced. Here, we will understand the e-way bill system, its benefits, and how to create e-way bills. 

Tax evasion is one serious problem for a country like India. Many businesses & individuals avoid paying taxes. As a result, the country faces humongous destruction. Tax is an essential income source for the government. The money accumulated from this is used for the welfare of society such as healthcare, education, pensions, etc.

Table of Contents

GST, NIC, and CBC Council are collectively working for curbing tax evasion. With this, they are:-

  • Tracking the filed GST data
  • Fine Tuning the processes
  • Identifying gaps
  • Modifying existing rules (if any failure)

Some Acronyms 

GSTIN: Goods and Services Tax Identification Number

API: Application Program Interface

ICT: Information and Communication Technologies 

EBN No or EBN: e way bill Number

GST: Goods and Service Tax

NIC: National Informatics Centre

CBC: Central Bureau of Communication

1. Background

During the period of pre-GST, the consigned goods could have either a prescribed challan, delivery challan, or invoice under the respective Sales Tax or VAT Act. The consigned goods were either verified by the upcoming/ outgoing check post of that specific region. 

Hence, there were delays in goods movement. It took more time with the roving squad detentions or check posts. Improper documentation also led to wasting time at the check post.

2. When GST was introduced!

The government wanted to make goods transportation easier without any discrepancy. With the e-way bill, things came under control. In addition, they wanted to abolish check posts all across India.

3. What is an e way bill?

An e way bill is an enviable way to track the movements of goods. One can easily generate the e-way bill through the e-way bill portal. Through this portal, you get a unique identification number for the transportation of goods. 

The EWB is enclosed with complete details such as Name, GSTIN number, address, etc. It also contains details like value consigned, commodity consigned, etc. You can visit www.ewaybillgst.gov.in to generate your e-Way bill. Or else, you can visit e-invoice software to generate your e-way bill.

Please Note:-

It is mandatory for businesses to generate e way bills who wish to transport their goods (exceeding the product value of Rs. 50,000 or more than that).

a. Goods Movement

e way bill is generated based on the consignment value of goods and goods nature of the movement. 

Goods transportation within the state is called intrastate movement and outside the state is interstate movement. 

According to SGST rules, it is mandatory to generate an e way bill as per the threshold limit. 

You must generate an e way bill for the consignment value that exceeds Rs. 50,000/- for interstate movements. But, rules may vary for Special Economic Zones.

An example:-

A dealer needs to transport a consignment value of Rs. 65,000/-.

He has his warehouse in Pathanamthitta, Kerala, and wants to transport his consignment to Kochi (his headquarters). In this case, the nature of supply will be termed inter-state supply because Kochi comes under the Special Economic Zone. 

This is as per IGST Act, Section 7, 2017.

b. Transport

The movement of goods is commenced the moment the consignor hands over the goods to the carrier. The instruction must be irrevocable, clear and must specify the destination clearly. Hence, you need to create an e-way bill before the commencement of the goods transportation. 

The transportation will only be concluded as successful when the consignee gets their goods.

c. Consignment Value

The goods’ consignment value is determined as per the CGST Act Section 15, 2017. This is declared on a delivery challan, supply bill, and tax invoice and also includes the Cess, Integrated Tax, Territory Tax, Central Tax, and Union or State Tax charges (if any).

The exempt value is excluded for the supply of goods where the invoice is issued with respect to taxable goods supply and exempted goods.

d. Consignment Note

This document is issued by the Goods transportation agency against the receipt of the goods to transport goods in a goods carriage by road.

Why did the e way bill system come into the picture? How does the Government ensure to keep a check on tax evasion through an e way bill? 

With this tool, the Indian government can identify and combat tax fraud. 

The bill came into the picture to give unambiguous proof of the goods transportation from supplier to recipient.

4. E-Way Bill: Solution to the Biggest Trouble!

Some people were engaged in fraudulent practices. They falsely claimed that they had sold the goods and transported them. But in reality, no transaction really happened. They avoided fulfilling legal requirements. 

To bring accountability, transparency, and address these issues, the government introduced an e way bill system.

a. Auto-computation of Distance

The e way bill system calculates the distance automatically for the movement of goods. This is based on the recipient’s destination location and the postal PIN code of the source. e way bills streamline the process & reduce manual errors in distance calculation. 

So, in the case that the actual distance differs slightly from the calculated distance, you will not be charged.

The e way bill system typically calculates the transit distance and displays it for the user.

If the PIN codes of the destination and source are the same, you can enter a distance of up to 200 km. This update was likely introduced to accommodate scenarios where goods are moved within a small radius. 

In case, you shared the incorrect PIN code, then you will get an “INVALID PIN CODE” notification. e way bills with incorrect PIN codes are shared for review. The respective departments will check the accuracy of the details shared.

While this automated system provides convenience and reduces the burden of manual distance calculation.

b. Monitor the trips

Some transporters/ consignors conduct many trips using a single challan, invoice, etc. This practice leads to potential tax evasion. e way bill was introduced to avoid generating separate bills for each transaction.

c. No chance of multiple e way bills

You cannot generate e-way bills with the same invoice number again.

The purpose is to prevent the creation of duplicate or multiple e way bills for a single transaction. This could lead to potential tax evasion or other fraudulent activities. 

By enforcing this rule, the government aims to enhance the integrity and accuracy of the e way bill system. They are ensuring that each e way bill corresponds to a unique and legitimate transaction.

It is done to close all the loopholes as GST Act does not allow the taxpayer’s composition for any Inter-state transactions. In addition, the taxpayer’s composition supplies are allowed to enter any taxes for intrastate transactions.

d. Tallying GSTR 1 with an e way bill system

This step has become an essential process for Goods and Services Tax (GST) authorities. It ensures taxes are compliant and detects discrepancies in the movement of goods. 

The GSTN (Goods and Services Tax Network) receives two sets of data from taxpayers:

  • GST return filings in GSTR 1 
  • e way bills generated for the transportation of goods.

The process involves matching the information provided in GSTR 1. This includes the details of outward supplies made by the taxpayer with the data from the e way bill. It will contain information regarding the movement of goods with locations.

By reconciling these two sets of data, the GST authorities can identify any inconsistencies or discrepancies.

One of the common discrepancies that can be detected through this matching process is the under-reporting of distances. 

If the actual distance travelled is significantly different from the reported e way bill distance, it could raise concerns for the tax authorities. This could be an indicator of attempts to evade taxes by under-reporting the movement of goods.

By cross-referencing the information from e way bills with the GSTR 1 data, tax authorities can identify such discrepancies and then seek explanations from the businesses involved. 

Failure to reconcile these records or explain discrepancies may result in audits, penalties, or other enforcement actions by the tax authorities.

e. E-Way bill and FASTag integration

This is done to track the goods movement and curb the violations as well as evasions of GST. 

In the year 2018, central tax officers detected a considerable number of cases. This involved GST evasion and violations, amounting to a substantial sum of Rs 15,278.18 crore.

To address such issues and improve the monitoring of goods movement, the government has decided to integrate the e way bill system with NHAI’s FASTag mechanism. 

FASTag facilitates seamless and cashless payment of tolls at toll plazas. The integration of NHAI’s FASTag with the e-way bill system will provide authorities with real-time data about the movement of vehicles transporting goods. It will allow them to track the accurate location of the vehicle. In addition, it will also monitor and analyze the number of times it crosses the toll plazas of NHAI. 

By doing so, authorities can verify the genuineness of the e-way bills and ensure that they correspond to the actual movements of goods.

This integration will be particularly beneficial in cases where some transporters attempt to complete multiple trips using a single e-way bill. By having access to the FASTag data, authorities can cross-check the information provided in the eway bills and identify any discrepancies or potential cases of tax evasion.

Furthermore, this integration is expected to improve operational efficiencies in the logistics sector across the country. It will streamline the transportation process, reduce the scope for fraudulent practices, and enhance compliance with GST regulations.

Overall, the integration of NHAI’s FASTag with the e-way bill system is a significant technological advancement. It will strengthen the GST framework, promote transparency, and deter tax evasion in the movement of goods.

f. E-Way bill and Vahan System integration

Through this, the government aims to enhance the efficiency and accuracy of the goods transportation process. 

The Vahan System is an automated system managed by the Ministry of Road Transport and Highways in India. Through this system, records are maintained of registered vehicles in India.

When creating an e-way bill, transporters are required to provide the vehicle number that will be used to transport the consignment. The e way bill system validates this vehicle number by cross-referencing it with the Vahan System’s database. 

The e-way bill system ensures that the transporter enters the correct and valid vehicle number. This prevents the use of incorrect or fake vehicle numbers. Therefore, will curb the potential fraudulent practices or misuse of the e way bill system.

The integration with the Vahan System also facilitates the traceability of the commercial trucks used for goods transportation. Using this system, the authorities can monitor the movement of the vehicle. The government will also cross-verify the information provided in the e-way bill with the actual vehicle used for transportation. This helps in reducing the chances of unauthorized or unreported movements of goods.

5. Benefits of e-way bill

These e-way bills can be used by Taxpayers, Transporters, or GST Suvidha Providers. The taxpayers or transporters can have the following benefits.

Streamlined Goods Movement

e-way bills facilitate the smooth movement of goods across states and territories. With a single electronic document, there is no need for multiple permits or physical paperwork. Hence, will reduce bureaucratic hurdles and will save time.

Enhanced Compliance

e-way bills ensure proper documentation of goods in transit. Therefore, promotes better compliance with tax regulations. It helps in discouraging tax evasion and tracking goods movement.

Transparency and Visibility

Eway bill system provides visibility in real-time of goods in transit. Tax authorities and businesses can track the good’s movement. Thus, reducing the possibility of diversion or misreporting.

Reduced Tax Evasion

e-way bill systems minimize tax evasion scope. Since the movement of goods is closely monitored, it makes it difficult for businesses to under-report or evade taxes.

Double entry or duplicate invoices

Here, the taxpayers enter sales details in their computerized system and then generate the invoice. With this streamlined and automated approach, you can easily create documentation of goods transportation.

Avoid Mistakes

In a rush to generate the e way bill, there is a possibility that an employee may make mistakes or errors in the data entry. This will potentially lead to compliance issues and difficulties during the transportation process. Hence, you can avoid mistakes and errors with e-way bill generation.

6. Uses of e-way bill

  1. e-way bill is an essential document for interstate goods movement of consignment amounts surpassing Rs. 50, 000 in motorized transportation. 
  2. Any registered taxpayer of GST can do their registration in the e-way bill portal employing GSTIN.
  3. Transporters/ Unregistered users can register themselves in the e way bill system. They need to provide documents like an Aadhaar card and PAN card for the same.
  4. Transporter/ Recipient/ Supplier can easily generate e way bills.
  5. A transporter or the one who created an e-way bill can update/ enter the vehicle number in Form EWB-01 (Part B).
  6. The QR code is given in the e-way to do the verification.
  7. Certain products are exempted from the e way bill.

In case you are not transporting your goods via non-motorized transportation, then you need not generate an e way bill.

7. E-Way bill validity

  1. You cannot edit the detail shared in Form EWB o1- Part A-Content. Whereas for Part B, you can edit or modify the details such as vehicle number, Airway bill, etc.
  2. You can generate consolidated e-way bills for vehicles to carry multiple consignments. 
  3. The e-way bill validity is fixed for each 200 km for one day. You can extend the validity on the eway bill portal before the expiry.

8. E-Way bill dimensions

E-way bill validity differs from dimension to dimension. 

Suppose your vehicle goes under an “over-dimensional cargo” surpassing Central Motor Vehicle Rules, 1989- Rule 93, then the e-way bill is valid for 1 day. The distance allocated in this case will be 20 km with an additional day and an additional 20 km. 

If the cargo suffices the dimensional requirement under rule 93, the e-way bill is valid for 1 day. The distance allocated will be less than 100 km. Thereafter, you will get an additional day and 20 km of relaxation.

9. Who can generate or register for an e-way bill?

  • Any transporter of Goods
  • Citizens or unregistered
  • Registered dealer

A transporter of goods can either be an unregistered or registered transporter.

10. Document required to generate e-way bill

  • A challan, invoice, supply, or bill
  • PAN card
  • Aadhaar number
  • Vehicle’s Transporter ID
  • The document number of the transporter if the movement of goods is by ship, rail, or air.

11. When E-Way Bill is not required?

A few circumstances exist under which it isn’t really produced. They are-

Transportation using non-motor vehicles

If the goods are transported using non-motorized conveyances like hand carts or animals, an E-Way Bill may not be required.

Transportation to/from specified countries

E-Way Bill requirements may be exempted for certain transportation to or from specific countries as notified by the government.

Empty containers

When the goods are being transported in empty containers, an E-Way Bill may not be necessary.

Goods transported under custom seals

If the goods are transported under customs supervision and a custom seal is affixed to the conveyance, an E-Way Bill may not be required.

Transportation by rail with the central government as the transporter

In cases where the transportation of goods is done by rail, and the transporter is the central government or railways, an E-Way Bill may not be necessary.

Goods exempted under GST rules

Certain goods may be exempted from GST and, therefore, may not require an E-Way Bill.

Goods transported under Customs Bond

You do not need an e-way bill if you are transporting your goods under a Customs Bond from an ICD (Inland Container Depot) to a Customs port.

12. How to generate an e-way bill?

1. Register on the E-Way Bill Portal:

Go to the E-Way Bill portal at https://ewaybillgst.gov.in/ and register yourself as a taxpayer. If you are already a registered GST taxpayer, you can use your GSTIN (Goods and Services Tax Identification Number) to log in.

2. Log in to the E-Way Bill Portal

After registration, log in to the E-Way Bill portal.

Select the ‘Generate New’ option: From the main menu, select the “Generate New” option under the ‘E-Waybill’ tab.

3. Enter Transaction Details

Provide the required information about the transaction, including the following details:

4. Type of transaction (Outward/Inward).

Inward in the case where you are a recipient and Outward when the supplier

When you go for the option Transportation type, you need to choose the subtypes.

If you go for the option inward, you will get to see the below-mentioned options:-
Import
Supply
For own use
Sales Return
CKS/ SKD
Fairs or exhibition		If you go for the option outward, you will see options like:-
Export
Supply
For own use
Job work
Line sales 
SKD/CKD
Fairs or exhibition
Recipient not known
Fairs or exhibitions
Others
  • Document type (Invoice/Challan/Others)
  • Document number and date
  • From and To GSTIN or URP (Unregistered Person) details
  • Item details like product name, description, HSN code, quantity, etc.
  • Transporter details (Transporter ID and document number) if applicable.

5. Validate and Generate E-Way Bill

Verify all the details you have entered and then click on the “Generate E-Way Bill” button.

6. E-Way Bill Number (EBN) Generation

Once the details are validated, the system will generate an E-Way Bill Number (EBN). This EBN is a unique 12-digit number that serves as a reference for the E-Way Bill.

7. Print or Save the E-Way Bill

You can print the E-Way Bill or save it in the prescribed format. It should be carried with the goods during transportation, either physically or in digital form.

8. Updating Transporter Details

If you have not provided the transporter details during the E-Way Bill generation, you can update the transporter information later.

Remember that the process may vary slightly depending on whether you are generating an E-Way Bill for inter-state or intra-state movement, as well as any specific state rules. 

Additionally, ensure that you have the necessary supporting documents, such as invoices, before generating the E-Way Bill.

It’s essential to comply with the E-Way Bill requirements to avoid any penalties or legal issues during the movement of goods. For any specific queries or detailed guidance, you can refer to the official E-Way Bill portal or seek assistance from a qualified GST practitioner.

13. Some Frequently Asked Questions

You can generate an e way bill from  http://e-waybill.nic.in portal.

  • Registered individuals: Any entity that is registered and responsible for goods transportation is supposed to generate an e-way bill. 
  • Consignor or Consignee: Both the consignor and the consignee can generate the e-way bill if they are registered under the GST.
  • Transporter: If a transporter is authorized with GST registration can generate the e-way bill. They can generate this on behalf of any registered individual who is responsible for goods movement.
  • Unregistered Transporter: An unregistered transporter can also generate the e-way bill after enrolling on the common portal on clients’ behalf.

The e-way can be renewed either by the generator of the e-way bill (who is usually the supplier or seller) or by the transporter assigned to handle the specific e-way bill on behalf of the generator. Without the vehicle number being updated by one of these parties, the e-way bill is considered invalid for road transport.

  1. Registration: The person generating the e-way bill must be a registered taxpayer under the Goods and Services Tax (GST) regime. They can be a transporter or supplier. 
  2. Document Details: The e-way bill requires relevant documents like delivery challan, bill of sale, and tax invoice. 
  3. Transporter Information: The e-way bill should include details of the transporter, which can be their Transporter ID or vehicle number. It is made mandatory to verify and track the goods' movement. 

By meeting these prerequisites and providing accurate information, the registered person can successfully generate the e-way bill, which is required for the movement of goods in compliance with the GST regulations. As always, it is essential to verify the latest guidelines and requirements set forth by the concerned authorities to ensure adherence to current regulations.

If you make a mistake or wrong entry in the e-way bill, you can rectify it under certain circumstances. The e-way bill system allows for the correction of errors in the e-way bill within a specific time frame and based on the type of error made. Here are some key points to consider:

  1. Minor Errors: If there are minor errors in the e-way bill, such as clerical mistakes or typographical errors in the consignor/consignee details, product description, or vehicle number, you can rectify them. These corrections can be made before the movement of goods has commenced.
  2. Major Errors: If there are significant errors in the e-way bill, such as the wrong GSTIN, the incorrect value of goods, or the wrong place of supply, you cannot directly edit the e-way bill. 
  3. Time Limit for Correction: The e-way bill system allows you to make corrections to the e-way bill within a specific time frame. You can make the correction within 24 hours from the e-way bill generation. However, this time limit may vary from one state to another.
  4. No Correction After Movement Commences: Once the goods are in transit and have already moved, you cannot make changes to the e-way bill. In such cases, if there is an error, you must deal with it based on the relevant regulations and penalties for non-compliance.
  5. Documentation: It is essential to maintain proper documentation of the original e-way bill, as well as the corrected or cancelled e-way bill, to demonstrate compliance in case of any future audits or inquiries.

Yes, you can cancel an e-way bill under certain circumstances. Below-mentioned reasons are the situations under which you can cancel the e-way bill:

  1. Goods Not Transported: If, after generating the e-way bill, the goods are not transported for any reason, the e-way bill can be cancelled. This might happen if the transaction is cancelled, or the goods are no longer required to be moved.
  2. Incorrect Details: If there are errors in the e-way bill and you have not moved the goods, you can cancel the existing e-way bill.
  3. Change in Transportation Mode: If the mode of transportation changes for the consignment, and the e-way bill is not yet used for movement, you can cancel the e-way bill and generate a new one with the updated transportation mode.
  4. Other Valid Reasons: Apart from the above reasons, there could be other valid circumstances where you might need to cancel the e-way bill before the goods are in transit.

It's important to note that the e-way bill can only be cancelled before the commencement of goods movement. Once the goods are in transit, the e-way bill cannot be cancelled, and any required changes should be dealt with as per the applicable rules and regulations.

To cancel an e-way bill, you need to access the e-way bill portal and use the "Cancel" option for the relevant e-way bill. After cancelling the e-way bill, you should maintain appropriate documentation of the cancelled e-way bill for future reference and compliance purposes.

  1. Access the E-way Bill Portal: The person responsible for generating the e-way bill (usually the supplier or the seller) or the assigned transporter should log in to the e-way bill portal.
  2. Find the E-way Bill: Locate the specific e-way bill for which the vehicle number needs to be updated. You can find the e-way bill using the unique E-way Bill Number (EBN) or other search options on the portal.
  3. Update the Vehicle Number: Once you have found the relevant e-way bill, you can update the vehicle number to the one that is actually carrying the goods. Provide the new vehicle number in the designated field.
  4. Save and Update: After entering the correct vehicle number, save the changes made to the e-way bill by updating it with the new vehicle number.
  5. Carry the Updated E-way Bill: Once the vehicle number is updated in the e-way bill, ensure that the updated e-way bill is available with the transporter or the person in charge of carrying the goods during transportation. This ensures compliance and facilitates smooth goods movement. 

It's essential to update the e-way bill with the correct and current vehicle number to avoid 

any non-compliance issues during transportation. Additionally, proper documentation of the updated e-way bill should be maintained for record-keeping and reference purposes.

No, you cannot transport the goods using an e-way bill with no details about the vehicle.  An e-way bill that determines the vehicle number is necessary for goods movement. 

However, if the goods are transported within the state or less than 10 kilometres from the consignor's business place to the transporter's location, the vehicle number is not required.

It is also known as the "Consolidated EWB”. It combines the e-way bills of multiple individuals for multiple consignments being moved in one transport (vehicle).

The consolidated e-way bill simplifies the documentation process for the transporter. It ensures efficient goods movement, especially when there are multiple consignments with different e-way bills being transported together in the same vehicle. This approach reduces paperwork and makes it easier for the transporter to manage all the e-way bills associated with the consignments in one document.

Transporters can generate a consolidated e-way bill. It consolidates numerous e-way bills for various products being shipped in one vehicle.

Yes, you can.  The government has focused on conditions that allow flexibility for businesses. Hence, businesses can create the necessary documents for the movement of goods from wherever they are.

Yes! It is calculated upon the distance that must be covered for goods transportation. The e-way bill validity is calculated from its generation. 

Up to 100 km: Valid for 1 day
Additional 100 km: An extra day added

TRANSIN is also known as Transporter ID. The EWB system generates this unique 15-digit number.  The 15-digit TRANSIN is based on the following components:

  1. State code: It represents the code for the state where the transporter is enrolled.
  2. PAN (Permanent Account Number): This is the unique 10-character alphanumeric code assigned to the transporter for tax purposes.
  3. Check digit: It is a single-digit checksum used to validate the correctness of the TRANSIN.

Once generated, the transporter can share this TRANSIN with their clients. When the clients generate e-way bills for the transportation of goods using the services of an unregistered transporter, they need to enter this unique TRANSIN in the e-way bill form.

By using TRANSIN, the E-Way Bill system can track and record the movement of goods even when they are transported by unregistered transporters. This helps in ensuring proper compliance and monitoring of goods transportation under the GST regime.

As per the GST Act, Section 68, the Government has the power to make certain things mandatory for transporting goods. One of those things is the e-way bill.

The Karnataka Goods and Services Tax Rules, 2017 has a special rule, Rule 138. According to this rule, if someone wants to move goods worth more than Rs. 50,000, they must carry an e-way bill with them.

Therefore, to comply with the legal requirements and facilitate the smooth movement of goods, individuals responsible for transporting consignments valued above Rs. 50,000/- must generate an e-way bill. This bill serves as a crucial document for tracking and validating the transportation of goods. It ensures tax compliance under the GST regime.

Yes, you can get a Transporter ID. Here's how you can get a Transporter ID:

  • Visit the E-Way Bill portal. 
  • Look for the option related to enrolling as a transporter or click on the relevant link/button for "Enrollment for Transporters." 
  • You will need to provide certain details such as your Name, Address, Details of contact, and PAN. 
  • Submit the enrollment form.
  • Once you successfully enrol as a transporter on the EWB system, the system will generate a unique 15-digit Transporter ID (TRANSIN) for you.

You need to do GST registration and obtain GSTIN. Then go to the portal of the e-way bill and register yourself as the transporter. Make sure to double-check all the processes of registration. 

Once done, you will receive the Transporter ID number.

Yes, you can transport goods with different transportation modes. You can transport via Ship, Air, Road, and Rail. But, you must ensure to update the latest transportation mode or vehicle number.

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E-Way Bill