As the goods and services tax (GST) regime took off from July 1, implementation of the e-way bill provision will prove to be a tough nut, and the period of normalisation could be long, Anay Shukla, Vice-President – Business Development and Solution Designing, Apollo Logisolutions, tells BusinessLine.
- Under the e-way provision, it is mandatory for movement of goods with value of over ₹50,000 to be registered with the GST Network website. But, this has been put off till October due to lack of software preparedness. Excerpts:
- Will the paperwork that is done or carried by trucks go away with introduction of e-way bill?
- The paper work will continue for some time till there is more clarity on e-way bills. Check posts will probably go away in time when the entire systems are online and it becomes possible to find e-way bill numbers that are not matching.
- But the dwell time at check posts will definitely reduce. Today, at check posts, there is a lot of paperwork that you need to do, and a lot of underhand dealings go on.
What were the check posts originally supposed to do?
- In the pre-GST regime, check posts were set up to track goods — whether these were for the same State or were only passing through. The check post team looked at invoices and saw if these were destined for, say, Maharashtra, or passing through Haryana, Rajasthan, Gujarat. While transiting through a State, you had to have e-way bills that you had to show at the entry and exit points.
So, in the pre-and post GST regime, what has changed in check posts?
- From a GST perspective, one has to only see whether the e-way bills are matching.
- Under GST, suppose you have to sell goods in a particular State, you cannot get input tax credit unless everybody in the chain falls in line. This is where people will be forced to follow the rules.
- Technically, in the post-GST scenario, vehicles cannot be stopped for reasons they were done in the pre-GST scenario. But, practically, the vehicles will be stopped, as the physical infrastructure is still there and the people concerned are also very much there.
But surely paper checking will stop.
- Not really. For the first month or two, as things get ironed out, everybody in the transport industry is happy that at some point of time, this will happen. But at what point of time, we don’t know.
- There will be a period of normalisation in the GST regime also. A bit like demonetisation. It entirely depends on how prepared the government machinery is…. But, at some point of time, it will evolve.
Has there been a drop in bookings post-GST?
- Generally, every year, in the last week of June or early July, cargo bookings tend to go down. With the approach of GST, generally, sellers and resellers have been trying to liquidate the existing inventory as these are invoiced pre-GST.
- It is very difficult to sell the inventory on new invoice. So, a lot of transport movement has slowed down. When it starts picking up, may be at that time, there will be some choking at the check posts. As of now, the volume has dropped at check posts and choking has also dropped. During June, people were trying to sell off everything and new stocks stopped coming in.
- But, this is a temporary phenomenon. A lot of people have not done their GST registration. Till you don’t register, you cannot do invoicing, and till you don’t invoice, you cannot buy or sell products. So, people are not buying and people are not transporting also.
Are there other points where trucks could be checked or stopped?
- Agencies that check could vary from one State to another. It could be forest officials, sales tax officials, customs, local authorities, octroi in Maharashtra.
- Officially, these taxes no longer exist. When the government says these taxes are abolished, that means check posts will go away.
- The only issue that is a matter of debate is: Will there be fewer check posts post-GST?
(This article was published on July 14, 2017)
via ‘Post-GST, the period of normalisation at check posts could be long’ | Business Line
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