GST: Here’s what to do if your e-Way bill generation is blocked for tax defaults
By Archit Gupta
The government has introduced an important change around the e-way bill generation with an aim to crack down on GST non-filers and evaders. With effect from December 2, 2019, the blocking and unblocking of the e-way bill generation facility has been implemented on the e-way bill portal. E-way bill generation has been barred for taxpayers who haven’t filed their returns for the previous two consecutive months.
What is the intention of blocking e-way bill generation for taxpayers?
As per GSTN data, around 20.75 lakh GSTINs have not filed their GSTR-3B for September and October months. Also, out of these 20.75 lakh GSTINs, around 3.47 lakh GSTINs (16.7%) had transactions for September and October 2019 in the e-way bill system. Considering the rise in the number of tax defaulters, their ability to generate e-way bill had to be blocked. The tax department is of the view that non-filing of returns has been the primary reason for the decline in the GST revenue collection.
How will blocking of e-way bill generation work?
Every taxpayer who is registered under GST must file GSTR-3B, on a monthly basis. GSTR-3B has details of sales and purchases made by a business and the final tax payable after claiming input credit.
As per the new rule, when a taxpayer fails to file his or her GST returns (GSTR-3B) for two continuous months, he or she will get blocked from generating an e-way bill. A GSTIN which is blocked cannot be used for generating an e-way bill either as a consignor or consignee.For example, if a taxpayer has not filed his GSTR-3B return for September and October 2019, his/her e-way bill generation facility would get blocked from 2 December 2019.
How will unblocking of e-way bill generation work?
Only after a blocked GST taxpayer files his/her pending GSTR-3B for the default period(s), the blocked GSTIN will get unblocked automatically the following morning allowing him/her to proceed with e-way bill generation.
In case a taxpayer intends to generate an e-way bill soon after filing his/her return, he or she can visit the e-way bill portal and choose the option ‘Search Update Block Status ‘. He or she will need to enter his/her GSTIN, later he or she will need to enter the CAPTCHA code and click on ‘GO’. In case the status reflects as ‘blocked’ then he/she need to click on the option ‘Update Unblock Status from GST Common Portal’. This button will extract the most-recent filing status via the GST common portal and, if the returns are filed, the e-way bill system status will get updated subsequently to ‘unblocked’.
In case the system fails to unblock the GSTIN, the taxpayer can get in touch with the GST Help Desk and raise a complaint to get his/her query resolved.
Also, there might be certain situations where a taxpayer may not be able to file GSTR-3B on time. These scenarios may include technical glitches, or unavailability due to an emergency, etc. In these scenarios, genuine taxpayers can seek help from a jurisdictional tax official to get the e-way bill generation facility restored.
What this means for taxpayers?
Not generating an e-way bill will be considered as non-compliance as per the provisions of the GST law.
The business may not be able to deliver goods without an e-way bill. When goods are transported without an e-way bill, the authorities can claim that the consignor of the goods attempted to evade taxes and subsequently levy a fine equivalent to the tax amount payable. Such commodities and the vehicle transporting them can be seized or detained. Both the goods as well as the vehicle may be released only when the pending tax amount and the penalty mentioned by the concerned officer is paid.
Not possessing an e-way bill during transportation of goods can lead to the disruption in the day-to-day operations and deliveries of a business. This move will push taxpayers to be more compliant and make sure they file their returns/make their tax payments on time. Businesses need to be more careful by ensuring their GSTR-3B is filed within the deadline so that there is no disruption in their business-related operations. This new development within the e-way bill system may help improve GST revenue collection.