When E-Way Bill is Not Required: Understanding Exemptions and Exceptions
The E-Way Bill system ensures transparent goods movement under GST. Key exemptions include perishable items, low-value consignments, and certain transportation methods, reducing paperwork and enhancing compliance. Proper documentation is crucial.
Written by
CA Raj Kumar -
Updated on June 15, 2024.
Estimated Reading Time: 18 minutes.
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GST
The E-Way Bill system is a cornerstone of GST compliance in India. It ensures the smooth and transparent movement of goods across state borders. However, navigating the complexities of E-Way Bill requirements can be daunting. This article aims to assist you in understanding the key exemptions available and ensuring your business stays compliant.
What is an E-Way Bill?
An e-way bill is an electronic document generated online by taxpayers. It acts as a digital permit for the movement of goods within India. This document is crucial for facilitating the smooth and transparent movement of goods across state borders. It is mandatory for most interstate and even some intra-state transportation of goods.
The E-Way Bill system aims to streamline the process of goods transportation by reducing paperwork and human intervention. It integrates with the Goods and Services Tax (GST) network, ensuring a seamless flow of information between the transporter, the supplier, and the recipient of the goods. This digitalization helps authorities track the movement of goods and combat tax evasion.
E-way bills can be generated from the E-way Bill Portal. Anyone with a valid GST identification number can register, and after logging in, generate the e-way bills for the movement of goods. The user needs to fill out the necessary details, such as the invoice number, supplier and recipient information, product description, quantity, and value. Once all the required fields are completed, the system will generate a unique E-Way Bill number along with a QR code.
Why are e-way bills important, and when are they required?
E-Way bills are crucial for GST compliance. They provide a digital trail of goods movement, preventing tax evasion and facilitating efficient tax collection. They also help in streamlining logistics and simplifying the transportation process.
E-Way bills are generally required for goods transported across state borders and sometimes even within the same state. The threshold for mandatory E-Way Bill generation varies depending on the value of the consignment.
Understanding Exemptions: Who is Exempt?
The E-Way Bill system offers exemptions for certain goods, suppliers, transportation methods, and purposes. The provisions related to exemptions from the e-way bill are covered under Rule 138 (14) of the CGST Rules, 2017.
Exemptions based on the nature of goods:
-
Perishable items like fruits, vegetables, livestock, dairy products, etc. are exempted via Notification No. 2/2017. See below the full table containing a list of such items. See below Annexure u/s 138.
-
Alcoholic liquor for human consumption and petroleum products. These items aren't yet covered by GST laws.
-
Where goods are not supplied under Schedule III of the CGST Act, [these are not treated as supplies under the CGST Act, and hence their transportation also doesn't need an e-way bill].
Exemptions based on Consignment Value:
-
Consignments below a specific value threshold are often exempt. This threshold varies depending on the state. The threshold for interstate supply is Rs. 50,000. For intra-state supplies, the threshold may vary from state to state and can often be higher than Rs. 50,000 depending upon the notification of such a state.
Example: A transport of goods worth Rs. 50,000 may be exempt in one state, while the threshold could be Rs. 75,000 in another state.
Exemptions based on transportation methods:
-
When goods are transported by non-motorized conveyances.
Example: Transportation of goods by handcart or bicycle does not require an E-Way Bill.
-
Transportation by rail where the consignor is either the central government, the state government, or any local authority.
Exemptions based on supplier categories:
-
Any movement of goods caused by a defense formation under the Ministry of Defense as a consignor or consignee.
Example: Supplies for defense or diplomatic missions might be exempt.
Exemptions based on Purpose of Transportation:
-
Personal goods, like household items transported not for business, are typically exempt from E-Way Bill requirements.
Example: A family transports household items for a personal relocation.
-
Empty cargo containers are also exempt from E-Way Bill rules.
-
Goods are transported within 20 km from the place of business to be weighed at the weighbridge.
-
Empty LPG cylinders for packing purposes.
Special Case Exemptions:
-
Transportation under customs Supervision and Seal: Goods transported from an Inland Container Depot (ICD) to a port or vice versa under customs supervision and seal are exempt.
-
Transit cargo to Nepal and Bhutan: Goods transiting to these countries are exempt.
-
Specific relief schemes and notifications: Goods transported under certain government relief schemes or notifications may be exempt.
Documentation for Exempt Transport:
Even with exemptions, proper documentation is vital to demonstrating compliance, depending on the different scenarios. This can include:
-
Delivery Challan: A detailed document listing the transported goods and their receiver.
-
Invoice: The original invoice for the goods being transported.
-
GST Registration Certificate: Proof of the transporter's GST registration ID.
-
Other relevant documents: Any specific documentation related to the exemption being claimed.
Penalties for non-compliance:
Failing to comply with E-Way Bill requirements can lead to penalties. These can include:
-
Penalties under Section 122(1)(xiv) of the CGST Act: A penalty of up to Rs. 10,000 for not having the correct documents for the movement of taxable goods.
-
Penalties and seizures under Sections 129 and 130 of the CGST Act: These sections provide heavy penalties and seizures of goods, including vehicles. Penalties can vary depending on the circumstances, from 50% of the total value of goods to 200% of the tax payable on the goods as penalties.
Further, the transporter, if unable to prove innocence in the movement of goods in contravention of the GST laws, shall also have to bear penalties up to 100% of the tax payable on goods transported.
Understanding through different examples and scenarios:
-
Scenario 1: A farmer transports freshly harvested fruits from his farm to a local market within the same state. The transportation distance is short, and the consignment value is below the threshold limit for his state. This scenario may not require an E-Way bill.
-
Scenario 2: A small-scale business owner transports ready-made garments from his workshop to a customer's shop within the same city. The consignment value is below the threshold limit, and the transportation is done by a non-motorized conveyance. This scenario may not require an E-Way bill.
-
Scenario 3: A manufacturer transports raw materials for industrial use from one state to another. The consignment value is above the threshold limit. This scenario requires an E-Way bill.
Conclusion:
Understanding the complexities of E-Way Bill exemptions is essential for business owners to ensure they follow regulations and avoid any potential penalties. By carefully evaluating the nature of goods, transportation methods, and the purpose of transportation, you can ensure the smooth and legal movement of goods. Remember to maintain all necessary documentation to prove your eligibility for exemptions. Consulting with a GST expert can further assist you in navigating these complexities.
ANNEXURE [(See rule 138 (14)] – Eway Bill not Required
|
S. No. |
Chapter or Heading or Sub-heading or Tariff item |
Description of Goods |
|
1. |
0101 |
Live asses, mules and hinnies |
|
2. |
0102 |
Live bovine animals |
|
3. |
0103 |
Live swine |
|
4. |
0104 |
Live sheep and goats |
|
5. |
0105 |
Live poultry, that is to say, fowls of the species Gallus domesticus, ducks, geese, turkeys and guinea fowls. |
|
6. |
0106 |
Other live animal such as Mammals, Birds, Insects |
|
7. |
0201 |
Meat of bovine animals, fresh and chilled. |
|
8. |
0202 |
Meat of bovine animals frozen [other than frozen and put up in unit container] |
|
9. |
0203 |
Meat of swine, fresh, chilled or frozen [other than frozen and put up in unit container] |
|
10. |
0204 |
Meat of sheep or goats, fresh, chilled or frozen [other than frozen and put up in unit container] |
|
11. |
0205 |
Meat of horses, asses, mules or hinnies, fresh, chilled or frozen [other than frozen and put up in unit container] |
|
12. |
0206 |
Edible offal of bovine animals, swine, sheep, goats, horses, asses, mules or hinnies, fresh, chilled or frozen [other than frozen and put up in unit container] |
|
13. |
0207 |
Meat and edible offal, of the poultry of heading 0105, fresh, chilled or frozen [other than frozen and put up in unit container] |
|
14. |
0208 |
Other meat and edible meat offal, fresh, chilled or frozen [other than frozen and put up in unit container] |
|
15. |
0209 |
Pig fat, free of lean meat, and poultry fat, not rendered or otherwise extracted, fresh, chilled or frozen [other than frozen and put up in unit container] |
|
16. |
0209 |
Pig fat, free of lean meat, and poultry fat, not rendered or otherwise extracted, salted, in brine, dried or smoked [other than put up in unit containers] |
|
17. |
0210 |
Meat and edible meat offal, salted, in brine, dried or smoked; edible flours and meals of meat or meat offal, other than put up in unit containers |
|
18. |
3 |
Fish seeds, prawn / shrimp seeds whether or not processed, cured or in frozen state [other than goods falling under Chapter 3 and attracting 2.5%] |
|
19. |
0301 |
Live fish. |
|
20. |
0302 |
Fish, fresh or chilled, excluding fish fillets and other fish meat of heading 0304 |
|
21. |
0304 |
Fish fillets and other fish meat (whether or not minced), fresh or chilled. |
|
22. |
0306 |
Crustaceans, whether in shell or not, live, fresh or chilled; crustaceans, in shell, cooked by steaming or by boiling in water live, fresh or chilled. |
|
23. |
0307 |
Molluscs, whether in shell or not, live, fresh, chilled; aquatic invertebrates other than crustaceans and molluscs, live, fresh or chilled. |
|
24. |
0308 |
Aquatic invertebrates other than crustaceans and molluscs, live, fresh or chilled. |
|
25. |
0401 |
Fresh milk and pasteurised milk, including separated milk, milk and cream, not concentrated nor containing added sugar or other sweetening matter, excluding Ultra High Temperature (UHT) milk |
|
26. |
0403 |
Curd; Lassi; Butter milk |
|
27. |
0406 |
Chena or paneer, other than put up in unit containers and bearing a registered brand name; |
|
28. |
0407 |
Birds' eggs, in shell, fresh, preserved or cooked |
|
29. |
0409 |
Natural honey, other than put up in unit container and bearing a registered brand name |
|
30. |
0501 |
Human hair, unworked, whether or not washed or scoured; waste of human hair |
|
31. |
0506 |
All goods i.e. Bones and horn-cores, unworked, defatted, simply prepared (but not cut to shape), treated with acid or gelatinised; powder and waste of these products |
|
32. |
0507 90 |
All goods i.e. Hoof meal; horn meal; hooves, claws, nails and beaks; antlers; etc. |
|
33. |
0511 |
Semen including frozen semen |
|
34. |
6 |
Live trees and other plants; bulbs, roots and the like; cut flowers and ornamental foliage |
|
35. |
0701 |
Potatoes, fresh or chilled. |
|
36. |
0702 |
Tomatoes, fresh or chilled. |
|
37. |
0703 |
Onions, shallots, garlic, leeks and other alliaceous vegetables, fresh or chilled. |
|
38. |
0704 |
Cabbages, cauliflowers, kohlrabi, kale and similar edible brassicas, fresh or chilled. |
|
39. |
0705 |
Lettuce (Lactuca sativa) and chicory (Cichorium spp.), fresh or chilled. |
|
40. |
0706 |
Carrots, turnips, salad beetroot, salsify, celeriac, radishes and similar edible roots, fresh or chilled. |
|
41. |
0707 |
Cucumbers and gherkins, fresh or chilled. |
|
42. |
0708 |
Leguminous vegetables, shelled or unshelled, fresh or chilled. |
|
43. |
0709 |
Other vegetables, fresh or chilled. |
|
44. |
0712 |
Dried vegetables, whole, cut, sliced, broken or in powder, but not further prepared. |
|
45. |
0713 |
Dried leguminous vegetables, shelled, whether or not skinned or split. |
|
46. |
0714 |
Manioc, arrowroot, salep, Jerusalem artichokes, sweet potatoes and similar roots and tubers with high starch or inulin content, fresh or chilled; sago pith. |
|
47. |
0801 |
Coconuts, fresh or dried, whether or not shelled or peeled |
|
48. |
0801 |
Brazil nuts, fresh, whether or not shelled or peeled |
|
49. |
0802 |
Other nuts, Other nuts, fresh such as Almonds, Hazelnuts or filberts (Coryius spp.), walnuts, Chestnuts (Castanea spp.), Pistachios, Macadamia nuts, Kola nuts (Cola spp.), Areca nuts, fresh, whether or not shelled or peeled |
|
50. |
0803 |
Bananas, including plantains, fresh or dried |
|
51. |
0804 |
Dates, figs, pineapples, avocados, guavas, mangoes and mangosteens, fresh. |
|
52. |
0805 |
Citrus fruit, such as Oranges, Mandarins (including tangerines and satsumas);clementines, wilkings and similar citrus hybrids, Grapefruit, including pomelos, Lemons (Citrus limon, Citrus limonum) and limes (Citrus aurantifolia, Citrus latifolia), fresh. |
|
53. |
0806 |
Grapes, fresh |
|
54. |
0807 |
Melons (including watermelons) and papaws (papayas), fresh. |
|
55. |
0808 |
Apples, pears and quinces, fresh. |
|
56. |
0809 |
Apricots, cherries, peaches (including nectarines), plums and sloes, fresh. |
|
57. |
0810 |
Other fruit such as strawberries, raspberries, blackberries, mulberries and loganberries, black, white or red currants and gooseberries, cranberries, bilberries and other fruits of the genus vaccinium, Kiwi fruit, Durians, Persimmons, Pomegranates, Tamarind, Sapota (chico), Custard-apple (ata), Bore, Lichi, fresh. |
|
58. |
0814 |
Peel of citrus fruit or melons (including watermelons), fresh. |
|
59. |
9 |
All goods of seed quality |
|
60. |
0901 |
Coffee beans, not roasted |
|
61. |
0902 |
Unprocessed green leaves of tea |
|
62. |
0909 |
Seeds of anise, badian, fennel, coriander, cumin or caraway; juniper berries [of seed quality] |
|
63. |
0910 11 10 |
Fresh ginger, other than in processed form |
|
64. |
0910 30 10 |
Fresh turmeric, other than in processed form |
|
65. |
1001 |
Wheat and meslin [other than those put up in unit container and bearing a registered brand name] |
|
66. |
1002 |
Rye [other than those put up in unit container and bearing a registered brand name] |
|
67. |
1003 |
Barley [other than those put up in unit container and bearing a registered brand name] |
|
68. |
1004 |
Oats [other than those put up in unit container and bearing a registered brand name] |
|
69. |
1005 |
Maize (corn) [other than those put up in unit container and bearing a registered brand name] |
|
70. |
1006 |
Rice [other than those put up in unit container and bearing a registered brand name] |
|
71. |
1007 |
Grain sorghum [other than those put up in unit container and bearing a registered brand name] |
|
72. |
1008 |
Buckwheat, millet and canary seed; other cereals such as Jawar, Bajra, Ragi] [other than those put up in unit container and bearing a registered brand name] |
|
73. |
1101 |
Wheat or meslin flour [other than those put up in unit container and bearing a registered brand name]. |
|
74. |
1102 |
Cereal flours other than of wheat or meslin, [maize (corn) flour, Rye flour, etc.] [other than those put up in unit container and bearing a registered brand name] |
|
75. |
1103 |
Cereal groats, meal and pellets [other than those put up in unit container and bearing a registered brand name] |
|
76. |
1104 |
Cereal grains hulled |
|
77. |
1105 |
Flour, of potatoes [other than those put up in unit container and bearing a registered brand name] |
|
78. |
1106 |
Flour, of the dried leguminous vegetables of heading 0713 (pulses) [other than guar meal 1106 10 10 and guar gum refined split 1106 10 90], of sago or of roots or tubers of heading 0714 or of the products of Chapter 8 i.e. of tamarind, of singoda, mango flour, etc. [other than those put up in unit container and bearing a registered brand name] |
|
79. |
12 |
All goods of seed quality |
|
80. |
1201 |
Soya beans, whether or not broken, of seed quality. |
|
81. |
1202 |
Ground-nuts, not roasted or otherwise cooked, whether or not shelled or broken, of seed quality. |
|
82. |
1204 |
Linseed, whether or not broken, of seed quality. |
|
83. |
1205 |
Rape or colza seeds, whether or not broken, of seed quality. |
|
84. |
1206 |
Sunflower seeds, whether or not broken, of seed quality. |
|
85. |
1207 |
Other oil seeds and oleaginous fruits (i.e. Palm nuts and kernels, cotton seeds, Castor oil seeds, Sesamum seeds, Mustard seeds, Saffower (Carthamustinctorius) seeds, Melon seeds, Poppy seeds, Ajams, Mango kernel, Niger seed, Kokam) whether or not broken, of seed quality. |
|
86. |
1209 |
Seeds, fruit and spores, of a kind used for sowing. |
|
87. |
1210 |
Hop cones, fresh. |
|
88. |
1211 |
Plants and parts of plants (including seeds and fruits), of a kind used primarily in perfumery, in pharmacy or for insecticidal, fungicidal or similar purpose, fresh or chilled. |
|
89. |
1212 |
Locust beans, seaweeds and other algae, sugar beet and sugar cane, fresh or chilled. |
|
90. |
1213 |
Cereal straw and husks, unprepared, whether or not chopped, ground, pressed or in the form of pellets |
|
91. |
1214 |
Swedes, mangolds, fodder roots, hay, lucerne (alfalfa), clover, sainfoin, forage kale, lupines, vetches and similar forage products, whether or not in the form of pellets. |
|
92. |
1301 |
Lac and Shellac |
|
93. |
1404 90 40 |
Betel leaves |
|
94. |
1701 or 1702 |
Jaggery of all types including Cane Jaggery (gur) and Palmyra Jaggery |
|
95. |
1904 |
Puffed rice, commonly known as Muri, flattened or beaten rice, commonly known as Chira, parched rice, commonly known as khoi, parched paddy or rice coated with sugar or gur, commonly known as Murki |
|
96. |
1905 |
Pappad |
|
97. |
1905 |
Bread (branded or otherwise), except pizza bread |
|
98. |
2201 |
Water [other than aerated, mineral, purified, distilled, medicinal, ionic, battery, de-mineralized and water sold in sealed container] |
|
99. |
2201 |
Non-alcoholic Toddy, Neera including date and palm neera |
|
100. |
2202 90 90 |
Tender coconut water other than put up in unit container and bearing a registered brand name |
|
101. |
2302, 2304, 2305, 2306, 2308, 2309 |
Aquatic feed including shrimp feed and prawn feed, poultry feed and cattle feed, including grass, hay and straw, supplement andhusk of pulses, concentrates andadditives, wheat bran and de-oiled cake |
|
102. |
2501 |
Salt, all types |
|
103. |
2835 |
Dicalcium phosphate (DCP) of animal feed grade conforming to IS specification No.5470 : 2002 |
|
104. |
3002 |
Human Blood and its components |
|
105. |
3006 |
All types of contraceptives |
|
106. |
3101 |
All goods and organic manure [other than put up in unit containers and bearing a registered brand name] |
|
107. |
3304 |
Kajal [other than kajal pencil sticks], Kumkum, Bindi, Sindur, Alta |
|
108. |
3825 |
Municipal waste, sewage sludge, clinical waste |
|
109. |
3926 |
Plastic bangles |
|
110. |
4014 |
Condoms and contraceptives |
|
111. |
4401 |
Firewood or fuel wood |
|
112. |
4402 |
Wood charcoal (including shell or nut charcoal), whether or not agglomerated |
|
113. |
4802 / 4907 |
Judicial, Non-judicial stamp papers, Court fee stamps when sold by the Government Treasuries or Vendors authorised by the Government |
|
114. |
4817 / 4907 |
Postal items, like envelope, Post card etc., sold by Government |
|
115. |
48 / 4907 |
Rupee notes when sold to the Reserve Bank of India |
|
116. |
4907 |
Cheques, lose or in book form |
|
117. |
4901 |
Printed books, including Braille books |
|
118. |
4902 |
Newspapers, journals and periodicals, whether or not illustrated or containing advertising material |
|
119. |
4903 |
Children's picture, drawing or colouring books |
|
120. |
4905 |
Maps and hydrographic or similar charts of all kinds, including atlases, wall maps, topographical plans and globes, printed |
|
121. |
5001 |
Silkworm laying, cocoon |
|
122. |
5002 |
Raw silk |
|
123. |
5003 |
Silk waste |
|
124. |
5101 |
Wool, not carded or combed |
|
125. |
5102 |
Fine or coarse animal hair, not carded or combed |
|
126. |
5103 |
Waste of wool or of fine or coarse animal hair |
|
127. |
52 |
Gandhi Topi |
|
128. |
52 |
Khadi yarn |
|
129. |
5303 |
Jute fibres, raw or processed but not spun |
|
130. |
5305 |
Coconut, coir fibre |
|
131. |
63 |
Indian National Flag |
|
132. |
6703 |
Human hair, dressed, thinned, bleached or otherwise worked |
|
133. |
6912 00 40 |
Earthen pot and clay lamps |
|
134. |
7018 |
Glass bangles (except those made from precious metals) |
|
135. |
8201
|
Agricultural implements manually operated or animal driven i.e. Hand tools, such as spades, shovels, mattocks, picks, hoes, forks and rakes; axes, bill hooks and similar hewing tools; secateurs and pruners of any kind; scythes, sickles, hay knives, hedge shears, timber wedges and other tools of a kind used in agriculture, horticulture or forestry. |
|
136. |
8445 |
Amber charkha |
|
137. |
8446 |
Handloom [weaving machinery] |
|
138. |
8802 60 00 |
Spacecraft (including satellites) and suborbital and spacecraft launch vehicles |
|
139. |
8803 |
Parts of goods of heading 8801 |
|
140. |
9021 |
Hearing aids |
|
141. |
92 |
Indigenous handmade musical instruments |
|
142. |
9603 |
Muddhas made of sarkanda and phoolbaharijhadoo |
|
143. |
9609 |
Slate pencils and chalk sticks |
|
144. |
9610 00 00 |
Slates |
|
145. |
9803 |
Passenger baggage |
|
146. |
Any chapter |
Puja samagrinamely,-
(mixture of cowdung, desi ghee, milk and curd);
|
|
147. |
|
Liquefied petroleum gas for supply to household and non domestic exempted category (NDEC) customers |
|
148. |
|
Kerosene oil sold under PDS |
|
149. |
|
Postal baggage transported by Department of Posts |
|
150. |
|
Natural or cultured pearls and precious or semi-precious stones; precious metals and metals clad with precious metal (Chapter 71) |
|
151. |
|
Jewellery, goldsmiths’ and silversmiths’ wares and other articles (Chapter 71) |
|
152. |
|
Currency |
|
153. |
|
Used personal and household effects |
|
154. |
|
Coral, unworked (0508) and worked coral (9601); |
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CA Raj Kumar
I love blogging and studying taxation. I write articles related to Tax laws and common issues in handling taxation in India. Often, common but small mistakes make things complicated. I write and share them to save precious time of others.
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