E WAY BILL- “The document requisite”

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In the event of movement of goods, there are certain pre-requisites which ought to be taken care of :

Earlier in the older Indirect tax regime of India, the movement of goods had to be accompanied by certain documents . They served as information to the taxation authorities with respect to bona fides of the goods being transported in a vehicle. To simply put, earlier with out “e sugam”(erst while “the document requisite”) , goods were deemed to be moved illegally .

It is imperative that every Indirect tax legislation has this blockade built-in, in order to curb the illegal movement of goods, which we often call as smuggling. Hence even in the new GST taxation regime the same is built-in.

Section 68 of the CGST Act clearly states that certain documents be carried by the person in charge of conveyance, if certain X-Y-Z conditions (which will be later discussed) are met, in order to persent the same for verification if a proper officer intercepts the vehicle carrying goods. Hence due to the requirement of this section and by virtue of the power granted under this section 164 of the CGST Act (the section which gives government to make rules) E-WAY Bill was introduced .

Certain basic Questions and Answers:

What is E-WAY Bill?

Simply put it is the information which has to be provided to the GST department before movement of goods.

When should I file E-WAY Bill?

If your consignment value is in excess of Rs 50,000/-  before the movement of goods.

Who is liable to issue E-WAY Bill?

The Supplier (Registered or Un-registered). If un-registered supplier is in the equation then the registered receiver has to take care of the compliance.

Transporter- On his own motion or if supplier has not generated e way bill

How should I issue E-WAY Bill?

Through the online portal  http://164.100.80.111/ewbnat2/

Karnataka, Rajasthan, Uttarakhand, Kerala, Jharkand, Sikkim, Gujarat and Maharashtra have notified e way bill. Hence transporters and suppliers in these states can issue e way bill by logging in to the common portal.

Till when will the E-WAY Bill be valid?

Its kind of unique validity period One day validity for every 100 kms.

Documents required to generate E-WAY Bill?

Invoices and other documents such as bill of supply , challan related to consignment.

Transporter information: Transporter ID or Vehicle No (if transported by road) along with transport document number and date of document (if transportation is by any means other than road)

Any exemption to E WAY Bill?

E way bill need not be obtained if you are transporting certain specified goods (Annexure available in link ) -http://www.cbec.gov.in/resources//htdocs-cbec/gst/Ntfn%2027_2017.pdf

If means of transportation is non motorised

If you are transporting goods from the port, airport, air cargo
complex and land customs station to an inland container depot or a container freight
station for clearance by Customs and such other notified areas as may be prescribed.

Authors Comments:

As said in the introduction it is quite expected out of every law that it in itself provides for certain safe guards to ensure that the very purpose for which the law is built, does not get defeated.

Though E- WAY Bill is necessary to ensure smooth implementation of GST and governance of the same, there are certain shortcomings which have to be dealt with – every project has a shortcoming in its pilot phase. But more than that, over and above the shortcomings of the IT Infrastructure which majority are debating on , I would like to throw light on another intrinsic shortcoming of this compliance.

As only few states have notified E-WAY Bill system, only suppliers and transporters from that state can issue E-WAY Bill through common portal. This has led to lot of difficulties in inter state supply. For a mere demonstration let us assume that I am a purchaser from Karnataka, and my supplier is from Tamil Nadu. Tamil Nadu has not yet notified E-WAY Bill , for this reason the supplier cannot issue the same. But on the other hand, movement of goods in Karnataka need E-WAY Bill. Hence it has become an unnecessary burden on purchasers in the notified states. The same shall persist(for a short period of time) untill all the states notify E WAY Bill.

Tough the hype around the readiness of infrastructure of E-WAY bill must be heeded to, nevertheless there will always be certain inherent lags, despite the readiness – un hyped and intrinsic.

 

Things small business should take care about in the GST Regime:

Compliance Legal Rule Compliancy Conformity Concept

With the introduction of GST lot of new variables have come into the equation and the form of compliance with the law, which for years had been going in a settled way, is all of sudden being disrupted and the trajectory of the same has been changed.

It is inevitable, the new trajectory is going to pose challenges to small business owners and professionals but the same can be handled with quite bit of prepration. GST is asking for change in the way every small business works and small business have to be ready for the same. 

 Get your invoices right:

In the GST regime invoice formats have drastically changed. GST envisages 6 types of documents which can be issued under the GST regime namely:

  1. Tax invoice– Normal Invoice
  2. Bill of supply– Invoice to be issued while selling exempted good/services or under composition scheme
  3. Receipt voucher– To be issued on receipt of advance
  4. Refund voucher– To be issued when advance is received but no supply is made
  5. Payment voucher– To be issued when making purchases from a URD
  6. Revised tax invoice and credit or debit notes

The format for the above mentioned documents have been set out in the Invoicing rules issued by the GST council and  without the particulars as mentioned the invoice will be treated as an invalid document and the purchaser cannot take the input credit of the same.

Get your returns right:

With GST the Government is not the enforcer but the businesses are themselves enforcers of the law. Without proper returns benefits under GST cannot be availed. GST is clear-cut in that aspect.

Hence a return by the supplier will be matched with the return of the purchaser and vice versa and any inconsistency will be highlighted. Hence the returns form a critical part of ensuring that your business runs smooth under the GST regime.

The returns are so exhaustive that if you receive an advance, the same has to be mentioned in the return, if you dont pay your supplier the money you owe , the same has to mentioned in the return.

Hence returns contain each and every aspect of your business and not filing one- is not even an option in GST!

Get your HSN/Accounting Codes right:

HSN codes are codes given to each product category under the GST. HSN are basically codes which are universally accepted and laid out by GATT( Now World Custom Organisation).

Accounting codes are codes given to each identifiable class of services under GST.

Each HSN/AC codes have different rates under GST hence the HSN/AC under which your goods/services fall should be carefully picked out. If there is a mistake in HSN/AC code you might just end up paying more tax.

Let me reiterate rates depend on HSN/AC so be careful about classifying your goods/services. There are litigation which have reached Supreme Court just for the classification issue( Just to give you a glimpse on the seriousness of the matter).

Get acquainted with Valuation and Place of supply:

GST Invoicing rules lay out that in every tax invoice value of the supply and place of supply should be mentioned. For each and every product/service place of supply might change.

For determining place of supply of goods, movement of goods and location of goods are to be considered. Whereas for services the factors vary from service to service. Hence it becomes critical that business get their homework done and get acquainted with all the place of supply and valuation of goods/ services.

Get ready with your DSCs:

GST has explicitly mentioned that a digital/electronic invoice signed through DSC can be issued. Hence it’s a good enough initiative by the government to make business go paperless. Hence start using invoices electronically. Till date there was no explicit mention of the same and with GST the doors to making offices paperless have truly begun.

“Readiness is mother of luck!”