How do E-way bill rules impact the Unregistered Persons?

E-way bill provisions have come into effect from 1st April 2018 for inter-state transactions and in a staggered manner rolled out for intra-state transactions by 1st June 2018. In this article, we will discuss E-way Bill for unregistered persons.

The erstwhile physical Way Bills have now become E-way Bills (Electronic-Way Bills). It is indeed a step towards Digital India and a transparent tomorrow.

As a quick recap, the E-way bill mandate requires that for all movement of goods meeting the specified criteria, a unique number is to be obtained from the Government’s system and this unique number, referred to as E-way Bill Number needs to be carried along with the consignment. In most of the cases, the movement of goods can be commenced only after generation of an E-way Bill Number. Read our article to know more about E-way bill under GST.

Typically, the person initiating the movement of goods is responsible for generating the E-way Bill Number. However, the transporters are also allowed to generate and manage the E-way Bill Numbers on behalf of the supplying or receiving parties.

Any person who is registered with the E-way Bill System can generate the E-way Bill Numbers. Supplier, Receivers, and Transporters who are registered with GST system and possess a GST identification number (GSTIN) can register themselves with E-way Bill System using their GSTIN.

Section 2(84) of the CGST Act terms the person who is not registered under the Act as an unregistered person (URP). As an example, persons having an annual turnover less than Rs 20 lakhs are not liable to obtain a GST registration and hence will get classified as an unregistered person. Such unregistered persons as part of their usual business process, however, may need to transport goods.

Let us look at some key rules applicable to the unregistered persons for E-way Bills.

1. Is an unregistered person required to generate E-way Bill?

Where an unregistered party is involved in a transaction, the onus of generation of the E-way Bill is shifted to the Taxable Person. Where none of the parties to the transaction are registered, then either of the parties needs to register with GSTN or the transporter needs to generate the E-way Bill.

2. What are details of an unregistered dealer required to be entered at the time of generation of E-way Bill?

In the GSTIN field, ‘URP’ needs to be mentioned where the counterparty (either the supplier or receiver) is an unregistered person. Name is not a mandatory field, but it is recommended to mention the trade or legal name of the unregistered party. Address, state and PIN code are required to be updated as it is.

3. If the transporter is an unregistered person, can he/ she still generate an E-way Bill on behalf of suppliers and receivers?

E-way Bill Numbers can be generated by persons who are registered with the E-way Bill system. If the transporter is an unregistered person, then he/she will need to enrol with the E-way Bill system in order to be eligible to generate E-way Bill Numbers. Upon enrolment with E-way Bill System, the transporter is given a unique 15-digit identification number, referred as Common Enrollment Number or Transporter ID. This Transporter ID needs to be mentioned while generating E-way Bill Number.

4. If the transporter, who is an unregistered person, does not enrol with E-way Bill System, can he/she update the vehicle details in E-way Bills which are generated by the suppliers or the recipients?

Vehicle details can be updated by the generator of E-way Bill or the transporter if the Transporter ID is mentioned. Transporter ID can either be GSTIN if the transporter is a registered person or the unique ID given by E-way Bill system upon enrolment.

If the unregistered person does not get enroled with E-way Bill system as a transporter, then vehicle details cannot be updated by them. Hence, in order to keep the transport transaction and E-way Bill process hassle free, a transporter should ideally get registered.

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. IRIS has been in the financial compliance space for over 2 decades and has worked with regulators and filing entities alike. We have supported MCA filings for over 700 entities including companies of groups such as Tata, Reliance, TVS, Godrej, L&T etc. Our E-way Bill solution, branded as IRIS Topaz, is an end-to-end solution for entire E-way Bill cycle. IRIS Topaz can be accessed through the web, desktop utility, and APIs.