E-Way Bill in India: Meaning, Cancellation Process, and Timeline
With the rapid growth in inter-state trade, E-Way Bill has emerged as a crucial element of India's Goods and Services Tax (GST) regime. Businesses involved in the movement of goods from one place to another must have an understanding of the E-Way Billing system, to ensure they comply with the legal requirements while ensuring seamless operations. The E-Way Bill system in India has revolutionized how goods are tracked, reported, and moved under the GST regime. While generating an E-Way Bill is mandatory for many transactions. In this blog, we’ll delve deep into what an E-Way Bill is, whether it can be cancelled, and the step-by-step procedure and timeline for cancelling one.
What is an E-Way Bill in India?
The E-Way Bill (Electronic Way Bill) is a mandatory document required for the transportation of goods valued at more than ₹50,000 under the GST framework. Introduced under Rule 138 of the CGST Rules, the system came into effect on April 1, 2018, since then it has been a cornerstone of India's tax compliance infrastructure.
The E-Way Bill is generated on the GST E-Way Bill Portal and contains critical details such as invoice or bill number, date of issue, consignor and consignee details, goods description and HSN code, quantity and value, and transport details like vehicle number or transporter ID.
An E-Way Bill is required for the supply of goods, return of goods, or inward supply from an unregistered person. There are exceptions for specific goods like perishables or others which require an E-way bill even below the ₹50,000 threshold.
An E-Way bill is valid for fixed time period, which depends on the distance the goods need to be transported. For a distance of 200 km, it is valid for 1 day from the date of generation. For every additional 200 km or part thereof, its validity increases by a day for every 200km.
Can You Cancel an E-Way Bill?
Yes, you can cancel an E-Way Bill once generated, but only under specific conditions and within a defined time period. The cancellation feature helps taxpayers avoid non-compliance with the tax laws and to resolve logistical issues which are inevitable.
An E-Way Bill can be cancelled on the following conditions –
• The goods are not transported
• Incorrect details were entered in the system
• if it was generated more than once for the same consignment.
Note- An E-Way Bill verified in transit by a GST officer cannot be cancelled. It is important to note that you making timely cancellation of the bill within 24 hours of generation.
How to Cancel an E-Way Bill – Process and Timeline
Cancelling an E-Way Bill is simple if done within the permissible time window. The cancellation request must be initiated within 24 hours of generation of the E-Way Bill. If you miss the 24 hour window, the system woun’t allow you to make the cancellation through the portal, which means other corrective measures would be required making it complex and challenging.
The person who generated the E-Way Bill is entitled to cancel it using the same credentials as used to log into the portal. Once cancelled the E-Way bill becomes invalid for transportation and must not be used to avoid any penalty and fines.
Cancelling an E-Way Bill is a straightforward process, provided it is done within the permissible time frame of 24 hours from generation. This feature is essential for correcting genuine mistakes or addressing unexpected changes in business transactions. Below is a detailed guide on how to cancel an E-Way Bill on the official GST portal:
1. Log in to the GST E-Way Bill Portal
Begin by visiting the official GST E-Way Bill Portal. Use your GSTIN credentials to log in securely. Only the person or business entity that originally generated the E-Way Bill can initiate its cancellation.
2. Navigate to the ‘Cancel’ Option
Once logged in, locate the menu on the dashboard. Click on the ‘E-Way Bill’ tab, and under this, select the ‘Cancel’ option. This section is dedicated to all cancellation-related activities.
3. Enter the 12-Digit E-Way Bill Number
You will be prompted to enter the unique 12-digit E-Way Bill Number associated with the consignment you wish to cancel. Make sure the number is correct to retrieve the corresponding bill details.
4. Choose the Reason for Cancellation
From the drop-down list, select the most appropriate reason for cancellation. Common options include:
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Incorrect entry of details (such as wrong invoice number, transporter ID, etc.)
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Duplicate E-Way Bill generated for the same shipment
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Order cancellation, where goods were not dispatched as planned
Choosing the correct reason ensures accuracy in records and avoids issues during audits or reconciliations.
5. Submit the Cancellation Request
After selecting the cancellation reason, click on ‘Submit’ to initiate the cancellation. A confirmation message will appear on the screen, indicating that the request has been successfully processed.
6. Status Updated to 'Cancelled'
Once successfully cancelled, the status of the E-Way Bill is automatically updated to ‘Cancelled’ in the system. This means the document is no longer valid for the movement of goods and must not be used for transportation purposes.
Please note that if an E-Way Bill is not cancelled in a timely manner in case the goods are not transported to the consignee, it can lead to compliance issues and potential penalties during audits and annual tax filing. It is better to cancel the E-Way bill as and when required to ensure data accuracy and compliance integrity, thus making your business operation smooth and streamlined.
The flexibility and option provided by the online E-Way portal to cancel and E-Way bill within 24-hour window provides room to correct genuine errors, and helps businesses make sure they are in compliance with the tax laws. The concerned person generating E-Way bill must double-check the entries before generating the bill, if there is any error or discrepancy they must promptly cancel the erroneous bill to prevent further consequences. It is a good practice to maintain records of cancelled and regenerated bills for audits and other individual requirements. You don’t need to be a master at the nuances of the E-Way Bill system, or the cancellation procedures, rather you can trust the services of seasoned professionals.
Onlinegstregistration.co is your one-stop solution for the legal and financial business needs. With a team of expert Chartered Accountants, Company Secretaries and other professionals who ensure you and your business remain compliant with the latest GST and taxation laws. We have in-depth knowledge of various business fields and make sure you get the right set of advise to help streamline your business operations and reach its optimal performance. If you are worried about running and managing the complexities of taxation and other business laws, let us help in assisting you to resolve your business challenges while you focus on the growth strategy and take it to new heights.
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