Finance Ministry brings in changes in E-way bill system to check GST evasion

The Finance Ministry has introduced changes in the e-way bill system, including auto calculation of distance based on PIN codes for generation of e-way bill and blocking generation of multiple bills on one invoice, as it seeks to crack down on GST evaders. Over 3600 cases of GST evasion and violations involving Rs 15,278 crore were detected, during April-December 2018.

With instances of malpractices in e-way bill generation getting detected, the revenue department decided to rework the system for generation of e-way bill by transporters and business.

Touted as an anti-evasion tool, the electronic way or e-way bill was rolled out on April 1, 2018, for moving goods worth over Rs 50,000 from one state to another.

The E way bill for intra or within the state movement was rolled out in a phased manner from April 15. With instances of malpractices in e-way bill generation getting detected, the revenue department decided to rework the system for generation of e-way bill by transporters and business.

The newly enhanced system would come with auto-calculation of the distance between the source and destination, based on the PIN codes.

The user would be allowed to enter the actual distance as per the movement of goods, which will be limited to 10 per cent more than the auto-calculated distance displayed, according to the e-way bill portal.

For example, if the system has displayed the distance between Place A and B, based on the PIN codes, as 655 kms, then the user is allowed to enter the actual distance covered up to 720 kms (655 kms + 65 kms).

Besides, the government has decided not to permit the generation of multiple e-way bills based on one invoice.

This means, if the e-way bill is generated once with a particular invoice number, then none of the parties -- consignor, consignee or transporter -- can generate another e-way bill with the same invoice number. The enhanced feature would permit extension of validity of the e-way bill when the goods are in transit/movement.

The e-way bill portal, which has been developed by the National Informatics Centre (NIC), the country's premier informatics services organisation, would also generate a report for users on the list of e-way bills about to expire.

This would help the user to analyze the data and ensure that the goods reach the destination within the valid time period. Transporters of goods worth over Rs 50,000 would be required to present e-way bill during transit to a GST inspector if asked. Failure to produce an e-way bill can attract a penalty of Rs 10,000 or amount of tax sought to be evaded, whichever is higher.