SKP Group
SKP GST Update
8 February 2018
GST Update: Mandatory implementation of e-Way Bill stands cancelled, FAQ's on e-Way Bill released, clarification on default authorised services for SEZs under GST
Every year the Union Budget attracts a lot of attention from businesses and the public alike because of its potential to affect the prices of commodities through its indirect tax proposals. However, with GST subsuming most indirect tax levies and the GST Council being the decision making body under the GST regime, the Finance Bill, 2018 had limited amendments in relation to indirect taxes. However, certain important developments have taken place in the indirect tax regime which have been encapsulated below.
Rescission of implementation of e-Way Bill 
  • The mandatory implementation of e-Way Bill for the interstate movement of goods from 1 February 2018 was expected to ease trade and simultaneously plug revenue leakages in the tax system.  
  • However, on the very first day of its mandatory implementation, businesses faced difficulties in accessing the e-Way Bill common portal. As a result, the government vide Notification No. 11/2018 - Central Tax dated 2 February 2018 rescinded the notification (i.e. Notification No. 74/2017 - Central Tax dated 29 December 2017) which had notified the mandatory implementation of e-Way Bill from 1 February 2018. The official notification can be accessed here.  
  • In effect, the mandatory implementation of e-Way Bill stands cancelled until it is notified further.  
  • In the absence of any clarification in respect of the applicability of the e-Way Bill system, businesses should continue with the compliances mandated by individual states existing prior to 1 February 2018.
Release of FAQs on e-Way Bill
The Central Board of Excise and Customs (CBEC) has released FAQ’s on e-Way Bill with a view to provide clarification on certain issues pertaining to the e-Way Bill mechanism and the e-Way Bill Rules notified. Certain key clarifications are:
  • Inclusion of taxes in ’consignment value’:
    • The consignment value of goods should include the amount of central, state or union territory tax, integrated tax and Cess charged, if any, in the invoice/delivery challan.
  • Issuance of e-Way Bill in the absence of supply:
    • It has been clarified that an e-Way Bill has to be issued even in a case where the movement of goods is caused because of reasons other than ‘supply’, such as job work, replacement under warranty, recipient not known, exhibition or fairs, for own use, etc.
    • Furthermore, in such a scenario, the person who causes such movement should issue a delivery challan in lieu of an invoice.
  • Modifications to e-Way Bill:
    • Part A of an e-Way Bill once generated cannot be modified.
    • There is no restriction on updating Part B (vehicle details) of the e-Way Bill. However, the validity period of e-Way Bill is not recalculated after such updates.
  • Validity period of e-Way Bill is based on hours:
    • The validity period of e-Way Bill is based on hours. Therefore, for the purpose of determining the validity of an e-way bill, each day should be counted as twenty-four hours.
  • Transportation of goods in a semi/completely knocked-down condition:
    • In such a scenario, the supplier should issue the complete invoice before dispatch of the first consignment and should issue a delivery challan for each of the subsequent consignments, giving reference to the invoice.
    • Furthermore, each such subsequent consignment should be accompanied by copies of the corresponding delivery challan along with a duly certified copy of the invoice.
    • Also, the original copy of the invoice should be sent along with the last consignment.
    • Every consignment should also be accompanied with a separate e-Way Bill.
  • Rejection of goods by recipient:
    • If the goods are rejected by recipient due to some reason, the transporter can get one more e-Way Bill generated with the help of the supplier or recipient by indicating supply as ‘sales return’ and with relevant document details and return the goods to the supplier.
  • Role of sub-users in e-Way Bill system:
    • Sub-users can be assigned specific roles such as generation of e-Way Bill, rejection of e-Way Bill, etc.
Authorised services for SEZ under GST
  • GST legislation provided benefit to Special Economic Zones (SEZ) unit/developer by way of Integrated Goods and Services Tax (IGST) exemption on services procured and used for its authorised operations. However, there was no clarity with regards to services which could be considered as authorised services and thus, the said IGST exemption was not extended to various SEZ by state officers.
  • In order to reduce such ambiguity and exemption curtailments, the Board of Approval (BoA), in its 80th meeting held on 17 November 2017, had stated that the list of 66 services which were declared as default services used for authorised operations of SEZ under legacy laws would continue to be default authorised services under GST.
  • The communication for same was issued by the Ministry of Commerce and Industry to all SEZ Development Commissioners on 2 January 2018. The same can be accessed here.
SKP's Comments
  • The vexed implementation of e-Way Bill mechanism has proven the fears of the industry regarding the inadequacy of the IT infrastructure to handle the massive burden of e-Way Bill generation.
  • The FAQ’s issued by CBEC in relation to e-Way Bill will provide clarity in relation to ambiguities in the e-Way Bill mechanism.
  • The communication by Ministry of Commerce in relation to IGST exemption for SEZ units/developers will provide huge relief to businesses.
Urmi Axis | 7th Floor | Famous Studio Lane | Dr. E. Moses Road | Mahalaxmi | Mumbai | 400 011 | India
+91 22 6730 9000 | skp.gst |

India | USA | Canada | UAE
This update contains general information which is provided on an “as is” basis without warranties of any kind, express or implied and is not intended to address any particular situation. The information contained herein may not be comprehensive and should not be construed as specific advice or opinion. This update should not be substituted for any professional advice or service, and it should not be acted or relied upon or used as a basis for any decision or action that may affect you or your business. It is also expressly clarified that this update is not intended to be a form of solicitation or invitation or advertisement to create any adviser-client relationship.

Whilst every effort has been made to ensure the accuracy of the information contained in this update, the same cannot be guaranteed. We accept no liability or responsibility to any person for any loss or damage incurred by relying on the information contained in this update. 

© 2017 . All rights reserved.