‘Bill-to and Ship-to’ is a common business scenario wherein the party to whom invoice is billed is different from the party actually receiving the goods or services. While reporting in GST returns and also for seamless transfer of Input tax credit, there are two invoices generated in the transaction.
Let us refer to the following example to understand the scenario better
Supplier A in Maharashtra sells some goods worth Rs.1,00,000/- attracting 5% GST and bills to customer B in Maharashtra. On instructions from customer B, the goods are to be supplied to C in Karnataka. Now as per GST rules, there will be two invoices –
- Invoice no A001 (for example) from Supplier A to Recipient B. As both A and B are in the same state, this will be an intra-state transaction and CGST and SGST will be charged.
- Invoice no B001 (for example) from B (who will be the supplier) to Recipient C (who is in a different state). In this case, IGST will be applied. It should be noted that here the value of goods will be based on what price B has charged to C for this transaction which could be different from what A charged to B
|Bill-from party and place||The person who supplies the goods|
|Dispatch-from party and place||The person/place from where the goods are dispatched. It could be the places from where the supplier operates|
|Bill-to party and place||The person who places the order and will be making the payment|
|Ship-to party and place||The person/place who will be actually receiving the goods|
Here, either the supplier A or the other party B, can generate the E-way Bill Number. Using the same example, let us understand the details to be provided while generating E-way Bill Number
|Who generates E-way Bill||A (Supplier)||B (Bill To Party)|
|Invoice to be used||A will generate E-way Bill using Invoice No A001 details.||B will generate E-way Bill using Invoice No B001 details.|
|Bill-from party and place||A – Maharashtra||B – Maharashtra|
|Dispatch-from party and place||A – Maharashtra||A – Maharashtra|
|Bill-to party and place||B – Maharashtra||C – Karnataka|
|Ship-to party and place||C – Karnataka||C – Karnataka|
|Who can reject the E-way Bill?||As GSTIN of B is present in the recipient data (Registered Bill-to Party), only B can reject the E-way Bill though C is the actual recipient of goods.||As GSTIN of C is present in the recipient data (Registered Bill-to Party), C can reject the E-way Bill.|
|Supply Type and Tax applicable as per GST law||For Invoice No. A001 it is Intrastate and hence CGST and SGST applicable.||For Invoice No. B001 it is Interstate and hence IGST applicable.|
|Impact on GSTR 1 if data is to be populated from E-way Bill||Invoice No B001 from B to C will not be present in E-way bill records and hence no auto-population for GSTR1 of B for this transaction.||Invoice No A001 from A to B will not be present in E-way bill records and hence no auto-population for GSTR1 of A for this transaction.|
|Other comments||On delivery, C will receive the E-way bill details as per invoice raised by A for B.||On delivery, C will receive the E-way bill details as per invoice raised by B for C only.|
To sum up, the details to be provided for generating E-way bill are primarily determined by who is generating the E-way bill.
For further reading, you can refer to the press release detailing the Bill-to and Ship-to scenario here. The excerpt from E-way Bill FAQs on NIC portal is highlighted below
Q : How to handle “Bill to- Ship to” in E-way bill system?
A: Sometimes, the taxpayer raises the bill to somebody and sends the consignment to somebody else as per the business requirements. There is a provision in the e-way bill system to handle this situation, called as ‘Bill to’ and ‘Ship to’. In the e-way bill form, there are two portions under ‘TO’ section. On the left-hand side – ‘Billing To’ GSTIN and trade name is entered and in the right-hand side – ‘Ship to’ address of the destination of the movement is entered. The other details are entered as per the invoice. In case, ship to state is different from Bill to State, the tax components are entered as per the billing state party. That is if the Bill to location is inter-state for the supplier, IGST is entered and if the Bill to Party location is intra-state for the supplier, the SGST and CGST are entered irrespective of movement of goods whether movement happened within the state or outside the state.
Hope this article and the examples explain the Bill-to and Ship-to scenario and its impact on E-way bill.
IRIS is an established GST Suvidha Provider (GSP) and was one of the first GSPs to complete the integration with NIC’s E-way Bill System. Our E-way Bill solution, branded as IRIS Topaz, is an end-to-end solution for entire E-way Bill operations. IRIS Topaz can be accessed through the web, desktop utility, and APIs.
What should be the E-way bill transaction type, if ‘Bill-to’ party and ‘Ship-to’ party are having different addresses but same GST numbers? For example – Bill to party is in Mumbai (Pin code – XXXXXX), Maharashtra and Ship to party is in Aurangabad (Pin code – YYYYYY), Maharashtra and Both have same GSTN numbers.
The e-way bill transaction type will be ‘Regular’ or ‘Bill to – Ship to’ ?