Generating an e-waybill is one of the essential requirements for transporting goods that exceed the value of Rs. 50,000. The e-waybill consists of a required validity for the movement of goods and compliances. When goods are not transported due to unforeseen reasons, including vehicle breakdown, natural calamities, etc., transporters are required to apply for e-waybill extension. It legally allows them to have some more time to deliver the goods.
The extension process has various impacts on goods transportation and compliance. Extending a pre-decided delivery would significantly affect the consignor, consignee, and transporter. In this guide, we’ve mentioned all the impacts made due to e-waybill extension over related people.
Without any further delay, let’s begin step-by-step!
1. Influences of E-waybill extension on transportation efficiency
E-waybill extension is an online process to inform GST officials about the consignment delays due to any valid reason. However, it allows transporters to efficiently apply for more extra time to deliver the consignment appropriately. This system has certain positive and negative influences that we have mentioned below.
Positive Influences of E-waybill extension:
- Reduced Manual Processes and Paperwork: Electronic Waybills, also known as e-waybills, are entirely computer-based processes where the data entry and retrieval process is automated. It would lead your business to make quicker transactions and reduce the chances of errors in tax filing. Since it is all a desktop-based process, you don’t have to spend much of your time on manual processing and paperwork.
- Gives you flexibility for unforeseen circumstances: Transhipment often gets delayed due to several uncertain circumstances such as traffic jams, bad weather, vehicle breakdowns, natural calamities, and more. Every e-waybill has an original validity period to transit the shipment. It gives you the opportunity to legally extend the original e-waybill validity to allow the transporters for any delay.
- Better Compliance and Enforcement: The e-waybill system allows GST officials to monitor compliance better, as it comprises records in digital format. Moreover, it also has an automated checking feature that takes care of transportation while following legal and safety standards.
- Streamlined Audit and Report: With the help of e-waybill systems, businesses can generate in-depth reports and easily conduct internal audits while complying with all regulatory requirements. Moreover, digital records ease audit and analysis processes.
- Increased Security: Digital documents are considered a more secure format as compared to physical paperwork and documentation that consist of the risk of losing the document. The best thing about e-waybill is its authentication and encryption measures that allow you to keep the information confidential.
Negative Influences of E-waybill Extension:
- Technological difficulties: The e-waybill system requires building a reliable technological infrastructure in your business. Offline taxation processes have been traditionally used for a while in India. Hence, it will be challenging for businesses and employees to adapt to the use of new technology.
- Raise data security concern: E-waybills are in a digital format, which raises the risk of data security and privacy breaches. Hence, businesses have to invest good money in the security of their computer systems. Otherwise, they can easily be hacked or unauthorizedly accessed, and their data could be breached.
- Varied downtime and glitches: Like other digital systems, e-waybill platforms face downtime because of technical issues or maintenance. It disrupts the transporter’s routine and leads to unnecessary delays.
- Higher implementation costs: Most of the transporters work over traditional paper-based systems to maintain their taxation process. Shifting it to the electronic systems would bring initial implementation costs for you. For instance, it consists of software, hardware, and training costs, as you have to change the entire system.
2. Legal considerations for extended E-waybill impact on compliance
Extending e-waybills original validity involves certain legal considerations that impact compliance within the GST framework. Listed below are certain legal considerations that you should follow to avoid penalties, legal disputes, business operation disruptions, etc.
- Regulatory Compliance: E-waybill requires the transporters to comply with all the local, regional, and national GST regulations for the movement of goods. You have to meet all the adhered requirements determined by the relevant authority officials. There would be compliances like data fields, formatting standards, and the fixed duration for recording digital data. Make sure to follow all such regulatory compliances to avoid penalties and fines.
- Collaboration with Regulatory Authorities: Transporters have to collaborate with regulatory authorities to be updated regarding any new information or change brought into e-waybill requirements. It typically means participating in consultations, gaining some clarity over ambiguous regulations, and also coming up with certain feedback over practical implementation experience. It helps businesses establish a great relationship with the GST’s official authorities. Plus, businesses also make fewer compliance mistakes.
- Potential for Misuse or Non-Compliance: The e-waybill extension process allows the transporters to falsely exceed the validity period and make the government lose taxes. In simple words, there are possibilities of discrepancies and false declarations in the e-waybill data. For instance, the e-waybill extension will deter real-time tracking and verifying goods movement.
- Cross-Border Compliance: This compliance is crucial for businesses working in the international trade and transportation of goods. The governing regulations of e-waybills directly vary with the country, and those regulations have to be followed. Hence, you have to consider national compliances with e-waybill standards as well as relevant international agreements. Transporters must take care of these regulatory frameworks to attain smooth border crossings, face legal challenges, and be safe from financial penalties.
- Legal Agreements and Contracts: Every transportation under e-waybill is required to have legal agreements and contacts. Both the parties, consignor and consignee, are required to follow all the e-waybill compliance requirements during the generation, transmission, and verification of e-waybills. Also, make sure to properly clear all the contract terms to handle or solve compliance-related issues. If you include the required legal considerations in your contracts, you will establish a solid foundation for e-waybill compliance and risk management.
- Penalties for Non-Compliance: Relevant tax authorities impose penalties and fines over businesses that are non-compliant with e-waybill regulations. It can include monetary fines, temporary or permanent suspension, operating license revocation, etc. The extent of your non-compliance will determine the severity of the penalties or fines you are charged. You should regularly perform audits and compliance assessments to avoid penalties for non-compliance. In this way, you can identify or rectify potential issues for your business.
3. Compliance obligations in managing transportation during extension
You have to follow specific compliance obligations in order to manage transportation during the extension. With the help of these obligations, you can maintain transparency, prevent misuse, and ensure necessary adherence regarding GST (Goods and Services Tax) frameworks. Below, we have mentioned all the required compliance obligations that you should follow.
- Data Accuracy and Integrity: When applying for an e-waybill extension, you are obliged to ensure that you’ve filled in the accurate information regarding the consignor, consignee, route, transporter details, etc. You are required to submit accurate documentation and timely inform relevant authorities about any possible delays or discrepancies.
- Keep Accurate Records: You have to keep records of all the supporting documents, including invoices, lading bills, challan, and more while applying for the e-waybill extension process. During the transit, you would be inspected anytime, and that requires you to have accurate documentation ready all the time. In fact, you should keep your records safe for audit purposes.
- Updated Estimated Time of Arrival: In the e-waybill extension period, you have to update authorities about the estimated time of arrival at your destination. It is an essential step to maintain transparency in your business. Plus, regulatory GST authorities are also updated regarding any possible changes in the transportation schedule.
- Transportation Route and Schedule Updates: If a transportation route changes for any reason, such as natural calamity, you have to provide tax authorities with reliable documentation. It updates tax authorities about your possible changes and increases your chances of approving an e-waybill extension.
- Proper Communication and Coordination: Both consignor and consignee should be well informed about e-waybill extension and their role and responsibilities in transhipment. Also, make sure to have proper communication and coordination with tax authorities during audits or inspections. You have to provide them with all the essential documents.
- Notification to Regulatory Authorities: Notification to regulatory authorities is required to notify them about the extension of the e-waybill period. You basically have to submit a formal letter or a letter based on what’s required in your local regulations.
4. Documentation requirements for goods movement during E-waybill extension
There are certain documents required during the movement of goods under the e-waybill extension period. Below, we’ve mentioned all the documents needed.
- Original and Extended E-waybill: The original e-waybill is one of the crucial documents required for applying for an extension. Once your extension request is approved, you will get a new e-waybill with a new validity period. You are required to carry the newly updated e-waybill during the movement of goods for an extended duration. It will allow it to be legally safe and secure during transhipment.
- Proof of Reason for Extension: To apply for an extension request, you have to come up with a legitimate reason. There are certain pre-defined for multiple unavoidable situations like traffic jams, natural calamities, route changes, vehicle breakdowns, weather conditions, etc. You have to choose the appropriate reason for your extension and give a brief description of your situation.
- Official Document of Vehicle Carrying Goods: When transiting goods, you are required to carry your vehicle’s official registration number. For transportation options like rail, air, or ship, you have to provide relevant authorities with the required transport document number. It will help you prove the authenticity of your transhipment.
- Consent of Consignor and Consignee: Applying for the e-waybill extension process requires transporters to have written consent from both the consignor and consignee. In this way, transporters can easily apply for the extension request and showcase their authenticity.
- Compliance and Regulation Proof: You should have the required documents demonstrating that you’ve appropriately applied for an extension request. This means you have followed all the governing rules and regulations. Plus, you are adhering only to the maximum validity period allowed for your e-waybills.
What is the Threshold Limit for Setting E-waybill by States?
5. Reporting obligations for extended E-waybills and transportation impact
- Report E-waybill Updates: When you apply for an e-waybill extension, there is a reporting obligation to update the e-waybill with new information accurately. It includes modification details like new arrival time, changed transportation route, and more. This allows you to keep your e-waybill constantly updated and aligned with the relevant tax authorities.
- Report Potential Delays and Discrepancies: If you come up with any delay or discrepancy such as route deviation, change in quantity or quality of goods, etc. You have to report to relevant tax authorities within the required time frame. Make sure to report all the potent delays and discrepancies that can lead you to any sort of penalties or investigations.
- Report Compliance Documentations: Transporters have to report tax authorities with compliance documentation following e-waybill regulations. It is especially related to the e-waybill extension process. You are also required to maintain records of extension requests, have proper legal communication with the consignor and consignee, and more.
- Report Valid Extension Reason: Transporters are required to provide GST authorities with a documented reason to extend the original e-waybill validity. It plays a crucial role in maintaining regulatory compliance and transparency. Generally, transporters apply for extension requests due to unexpected vehicle breakdowns, poor weather conditions, etc.
- Penalty Reporting: If you incur any penalty or fines during transhipment, you’re obliged to report them to the official tax authorities. It allows the GST officials to check up on your compliance and provide accurate records of transportation activities.
- Non-Movement Report: Not moving goods even after getting e-waybill extended validity requires the transporters to file a non-movement report over the required portal. It will keep transporters safe from any penalty or fine and keep a transparent approach. Plus, it also prevents the chances of misuse of the extension period.
- Post-Extension Reporting: When you’re done with delivering the goods within an extended validity period, you are obliged to report certain essential documents to relevant tax authorities. This is a required process to close the e-waybill process.
6. Challenges in ensuring compliance during E-waybill extension and transit
There are various challenges involved in the e-waybill extension and transhipment process. Many challenges vary based on regional regulations. However, we’ve mentioned certain common challenges based on compliance making for the e-waybill extension period.
- Varied Regulatory Framework: All the countries have their own specific regulations regarding e-waybill generation and other relevant processes. It indicates various compliances based on different regulatory requirements. Hence, businesses have to adopt various standards and procedures.
- Maintaining Documentation Consistency: The e-waybill extension process requires consistent maintenance of documentation. You have to always be prepared with documents related to the reason for the extension, consent of the consignor and consignee, and more. Maintaining all these documents during extension and other processes is required.
- Dynamic Regulations: Regulatory frameworks are dynamic in nature and keep changing for the better development. Coping up with these regular changes creates a significant challenge for transporters and makes them make certain adjustments.
- Interoperability Challenge: The recent e-waybill system requires integration with various other technological systems and platforms. The interoperability issue refers to creating problems in integrating systems and leading the whole transportation process to data discrepancies, delays, and inefficiencies.
- Continuous Improvement and Adaptation: While adapting e-waybill systems, you are required to improve in various aspects regularly. Since it is a complete technological framework, you must improve and adapt every day to grab new methodologies.
- Technological Challenges: Transporters have to develop technological infrastructure, which might create certain issues for them in several ways. Many times, these technological systems also cause certain hindrances and glitches, which make the system go down. Therefore, you will need technical experts and systems on your premises.
7. Exemption considerations for specific transportation scenarios
Various exemptions have been granted by the government or relevant GST authorities. For efficient transportation, you should apply for the exemptions to save your business some money. Below, we’ve mentioned specific essential exemption considerations that you should know about.
- Government / Military Transport: All the goods transported by government or military purposes are exempted from various commercial transportation regulations. However, these types of exemptions directly require the protocols of specific government and military men.
- Small Consignments: There are various exemptions available for small consignments, considering factors such as the weight and value of the goods. Authorities have set a specific threshold and documentation requirement, such as e-waybill, to claim for the exemptions.
- Agricultural or Livestock Goods: Transportation of agricultural goods is allowed to attain some specific exemptions. It includes agricultural products like livestock goods. These exemptions are available due to the certain flexibility in the regulatory requirements.
- Intrastate vs. Interstate Transportation: Intrastate transportation refers to delivering goods within your required state boundaries, while interstate transportation refers to delivering goods across varied states. Both have different exemptions for transporting goods. Transporters are required to be updated appropriately regarding the exemptions of your state and other state regulatory requirements.
- Emergency or Humanitarian Aid: Oftentimes, government or relevant authorities allow the transporters certain exemptions to transit goods for emergency situations or humanitarian aid. In such a situation, you can get the exemption from several documentation requirements and processes to proceed with the critical supplies to the required location.
- Transportation by Specific Modes: Different transportation modes, including rail, air, road, or maritime, have varied characteristics. All of them have different exemptions and streamlined compliances. Mode-specific transporters are required to apply for all the specified exemptions. Plus, they also have different documentation processes.
8. Best practices for maintaining compliance during extended E-waybill transit
- Keep Updated Regarding Regulatory Changes: You should keep updated regarding e-waybill regulations at all levels, including local, regional, and national. In particular, you should be aware of all the required amendments and updates in a timely manner to maintain compliance.
- Maintain Accurate Data On E-waybill: On the electronic waybills, you are required to fill out the accurate data and even update it. For instance, if there is any update on the transportation schedule, route, arrival time, etc., then you have to update it over your e-waybill portal.
- Have a Secure Record-Keeping System: For the e-waybill and its extension process, you have to establish a record-keeping system. In simple words, you’re required to maintain proper records for any future audits or inspections.
- Train Your Staff: Transporters should provide timely training programs to their staff members regarding the latest regulatory requirements of e-waybill extension. Because trained staff members efficiently manage extension requests and the overall transportation process. Hence, it creates a smoother transit experience for the consignor and consignee.
- Documented Valid Reason for Extension: To extend the e-waybill original validity, you have to document a proper valid reason. For instance, if you want to extend validity due to bad weather, unexpected delays, vehicle breakdown, etc., then you have to provide supporting official documents with it. Plus, you are also required to be ready with the supporting documents for any possible inspection.
- Confirm Digital Signature Compliance: If your e-waybill extension process requires a digital signature, then you should fulfill this compliance. However, make sure to adopt authorized and secured methods for digital signature, as they allow you to maintain the integrity and authenticity of the e-waybill.
- Planning and Documentation: While generating e-waybill, you should also be prepared for the extension. This means you should have all the required documents with the latest regulatory requirements. In this way, you will always be ready for any potential delay or discrepancy. Thus, you will serve a smoother transit experience to the consignor and consignee.
- Know All Possible Exemptions: Transporters should be well aware of all the possible exemptions involved in various transportation processes, considering varied modes. Also, make sure to know the documentation and criteria required for specified exemptions. In this way, you can lead a smoother transportation and e-waybill extension process.
9. Audit and verification of transportation practices during E-waybill extension
- Document Review: In the audit and verification process, e-waybill and its related documents are properly checked by GST authorities. To be specific, they check for original e-waybill, valid reason for extension, relevant documentation, and more. Also, make sure to keep the records of the newly updated e-waybill, as officials will inspect it as well.
- Checks E-waybill Regulation Compliances: Auditors thoroughly check a business, whether it adheres to all the potential regulations or not. You have to properly follow all the compliances required during e-waybill generation and extension within the stipulated time frame. It allows the authorities to understand that the transporter has taken care of all the legalities.
- Reconfirm Extension Reason: During audit and verification, you have to document a valid reason with supportive documents to represent the accuracy and completeness of your extension request. You have to keep written applications from the consignor and consignee with other relevant documents as well.
- Communication Protocols: Auditors are required to follow certain protocols while establishing communication between the transporter, regulatory authorities, consignors, and consignees. As per efficient communication, all the stakeholders should be properly informed about compliances.
- Record keeping and Retention: Compliances are generally evaluated based upon record keeping and retention requirements. Here, businesses are required to maintain extended e-waybills for a defined duration. It is necessary for the auditors to confirm that all the essential records are available for inspection.
- Check for Accuracy of Data Entry: Auditors very well check for the accuracy of data filled out on the e-waybill system. It includes details like the consignor and consignee’s information, description of goods, the reason for the extension, and more. Plus, the value and quantity of goods will also be checked under the audit and verification process.
10. Legal consequences of non-compliance with transportation rules during extension
Typically, there are four types of legal consequences for non-compliance with transportation rules during the e-waybill extension process. We have mentioned all of them below that can help you based on Indian jurisdiction.
- Penalties or Fines: As per legal consequences of non-compliance, there are certain penalties and fines that you might end up facing. Below, we’ve mentioned them clearly.
- Financial penalties: You would have to pay a fine of a fixed amount or a specific percentage of the value of the goods. The amount of penalty varies based upon the severity of non-compliance or violation of any specific rule/provision.
- Late fees: If you fail to apply for an e-waybill extension within the required timeframe, you will have to bear late fees.
- Goods detention: Authorities have the power to detain your goods until you rectify the non-compliance or pay the penalties.
- Reputation Damage: When your business gets involved in any non-compliance or legal proceedings, it directly impacts the reputation of the business. Plus, if you are found to be involved in any criminal charges, it might also lead you to imprisonment.
- Lose Business License: Frequently involved in severe non-compliance or rules violations can lead you to suspension or cancellation of the business license of the transporter. Hence, it can significantly disrupt a business.
- Prosecution: If you are found to be involved in any intentional misuse of extension, tax evasion or document falsification, you can be caught up under legal prosecution. In such cases, you will have to bear heavy fines or imprisonment.
Extending e-waybills typically creates significant delays for consignors, consignees, and transporters. It even requires various different types of documents and consents that consume more time and energy for all the involved parties. From self-reporting documents to audits and verifications, we’ve covered everything that can impact transportation goods and compliances. We hope this guide helps you understand any crucial impact that you can face in your business.
Frequently Asked Questions (FAQs)
Q1. What happens if an e-waybill is experienced during transit?
Once an e-waybill bill expires, it should not be moved legally. However, if your validity expires due to any unforeseen or uncertain reason, like natural calamities or vehicle breakdown, then you can extend your e-waybill validity. You can apply for an e-waybill extension by giving a valid reason and filling out details in PART-B of FORM GST EWB-01.
Q2. What happens if goods are not transported even after the e-waybill is generated by the client?
E-waybill can easily be canceled if goods don’t get delivered as per the standard details mentioned. In an ideal case, you should cancel your e-waybill within 24 hours of its generation.
Q3. What are the advantages of e-waybill?
E-waybills are beneficial in various cases, as mentioned below:
- It avoids any duplicate or double entry of invoices.
- It allows you to avoid making any mistakes while generating an e-waybill.
- You can avoid two prints of e-waybills and invoices.
Q4. Can you extend the validity of an expired e-waybill?
The e-waybill extension process can only be initiated by the required transporter. But, if you haven’t assigned any transporter, then you can effortlessly extend it by yourself. As per compliance, you have to apply for e-waybill extension requests before and after the 8 hours of expiry.
Q5. What is the reason for an e-waybill extension?
Once the e-waybill extension process expires, you can not move your goods. Oftentimes, electronic waybills expire under various uncertain conditions, such as vehicle breakdowns or weather changes. At such times, you can apply for your e-waybill extension.
Q6. Can we reject the e-waybill after 24 hours?
E-waybills can be issued by officials within 24 hours of generation only. Once your e-waybill is canceled, it remains of no use. However, if your e-waybill is empowered by any powerful or superior officer, then it won’t be canceled.
Q7. What is the penalty for not raising the e-waybill?
The minimum penalty for not raising an invoice is Rs.10,000. Otherwise, the transporter or owner is required to pay the total amount of taxes required. For the last decision, the candidate has to pay the higher amount among the two mentioned.
Q8. Who is exempt from e-waybill?
Certain transportation goods that are exempt from e-waybill are Liquified Petroleum Gas (LPG) for any domestic/household purposes or Kerosene sold under PDS (Public Distribution System).
Q9. In which case e-waybill is not required?
The consignment transported from a customs port, air cargo complex, airport, or land customs station to ICD (Inland Container Depot) or CFS (Container Freight Station) generally doesn’t require e-waybills, as they are already cleared by customs. Simply put, the goods transported under custom supervision/custom seal don’t have any special need for an electronic waybill.
Q10. Who verifies e-waybill?
Only the commissioner or an officer appointed by him can intercept any conveyance and verify the e-waybill or its number for interstate or interstate movement of goods.