The GST Council, in December last year, has changed the validity of E-way Bill to 1 day per 200kms instead of 100kms earlier permitted, affective 1 Jan 2021.
The rules suggest that all goods must move 200 km per day else the e-way bill can expire. If the e-way bill isn’t extended within 8 hours of expiry, the penalty is 200% of the tax amount.
While the decision taken by the council aims to reduce the malpractice of repeated usage of the same e-way bill as noticed by them in certain states/industries, the Indian transporters are terribly disturbed by the changes made in the e-way bill rules and call it an impractical move.
The New Amendment in Section 138 (10) of the CGST which halves the time period that is allowed for delivery of material is made without giving any consideration to the ground reality and without consultation from any transportation body, transporters claim.
As per transporters’ body AITWA, transporters are already burdened with the all-time high fuel prices & weak numbers post lockdown. Such penalties if levied will be “the last nail in the coffin for many.”
“The present E-way bill will cause havoc. Transporters who are forced to pay such huge penalties may commit suicide as they will be forced to stop operations. The Transport Industry is simmering with frustration; if something is not done by Government, it may erupt like a volcano,” quoted a statement from AITWA.
Why is the new rule impractical?
Following are some the reasons transporters are quoting to state the impracticality of the new e-way bill regulations:
• It takes transporters at least 4-5 days to collect goods from various agencies/suppliers and then carry it to the destined place. This is a major problem for Part Load Movement / Retail transportations / Small Traders.
• Due to vehicle impairment and breakdown, en route / jams / held up by any authorities / route diversion, road traffic accident etc, vehicle remain stranded for hours and sometimes days altogether.
• In case a factory is closed and delivery could be made beyond the prescribed time period or conveyance reached destination and is waiting for unloading near the consignees premises or Party may not take delivery on time; there the e-way bill gets expired and seizure is done by GST officials.
• E-way bill gets expired during Local holidays / festival holidays / factory holidays.
• Logistic challenges e.g. shortage of labors, non-availability of trucks to transport the goods etc.
• Humanitarian Grounds – Driver not well, or they leave for home during festival. In remote rural area, remote hilly areas or villages there is no internet or mobile connectivity or there is no electricity for any updation and E-way Bill gets expired.
With the implication of the new e-way bill regulations, transporters will have to monitor the e-way bill closely, take necessary action to generate new bill for a balanced journey, ensure its validity till the material is delivered even if customer takes delivery late and instruct drivers to drive according to the validity of the bill. This is against the very idea of “Ease of Doing Business”.
“The government with its new implications has made it impossible for the transporters to maintain the flow of their business. I request the government to revoke the rule and give the transporters a transit time of 100 kms per day,” Chirag Katira, General Secretary-Maharashtra, AIMTC & Director-SNGT said.
He added, “Transporters are considered as the backbone of the economy, and this new implication is weakening the backbone. It is imperative to strengthen the transporters to strengthen the nation.”
While transporters were unhappy with the e-way bill in the first place, they were still making their peace with it, as earlier transit time of 100 Kms per day gave some cushion to transporters to absorb delays; but the change of coverage per day to 200 Kms, has made it impossible to absorb any delay; hence making a lot of transporters prey of the rule every day.