Non Compliance & Cases where no E-Way Bill Required

Penalty for not carrying e-way bill during transportation of goods –

Section 122(1)(xiv) of CGST Act

Penalty for certain offenses

Where a taxable person who transports any taxable goods without the cover of documents as specified (e.g. e-way bill), he shall be liable to pay a penalty of Rs.10,000 or an amount equivalent to the tax evaded, whichever is higher.

Therefore minimum penalty for not carrying the e-way bill shall be Rs.10,000.

Reference  - Section 122 of CGST Act

Section 129(1) of CGST Act

Detention, seizure and release of goods and conveyance in transit

Where any person transports any goods or stores any goods (in transit) in contravention of the provisions of this Act or the rules made thereunder, all such goods and conveyance shall be liable to detention or seizure. After detention or seizure, it shall be released on payment of below amount - 

Where the owner of the goods comes forward for payment of tax and penalty: 

1. In case of Taxable goods - Applicable tax on such goods + Penalty equal to 100% of the tax payable on such goods.
2. In case of Exempted goods  -  2% of value of goods or Rs.25,000, whichever is less 

Where the owner of the goods does not come forward for payment of tax and penalty:

• In case of Taxable goods - Applicable tax on such goods + Penalty equal to 50% of the value of goods reduced by the tax amount paid thereon  
• In case of Exempted goods - 5% of the value of goods or Rs.25,000, whichever is less,

Reference  - Section 129 of CGST Act

Section 122(3)(b) of CGST Act 

Penalty for certain offenses

Any person who acquires possession of, or in any way concerns himself in transporting, removing, depositing, keeping, concealing, supplying, or purchasing or in any other manner deals with any goods which he knows or has reasons to believe are liable to confiscation under this Act or the rules shall be liable to a penalty which may extend to twenty-five thousand rupees.

Cases when e-way bill is not required

Rule 138 of CGST Rules

Generation of e-way bill

E-way bill is required for every movement of goods (whether inter-state or intra-state) where value of goods exceeds Rs. 50,000. However below are some exceptions / exemptions where e-way is not required even if the value of goods exceeds Rs.50,000.

Exceptions to e-way bill - Rule 138(14) of CGSR Rules

(a) where the goods being transported are specified in annexure. (Annexure in the end)

(b) where the goods are being transported by a non-motorised conveyance (also known as human powered transportation e.g. cycle, rickshaw, hand carts, horse carts, skates, carrying goods in hands or on shoulders etc.)

(c) where the goods are being transported from the customs port, airport, air cargo complex and land customs station to an inland container depot or a container freight station for clearance by Customs;

(d) in respect of movement of goods within such areas as are notified under clause (d) of sub-rule (14) of rule 138 of the State or Union territory Goods and Services Tax Rules in that particular State or Union territory;

(e) where the goods (except de-oiled cake) are specified in the Notification No. 2/2017- Central tax (Rate) dated 28th June, 2017 as amended from time to time. View Notification No. 2/2017 and all further amendments to the same

(f) where the goods being transported are -

- alcoholic liquor for human consumption,
- petroleum crude,
- high speed diesel,
- motor spirit (commonly known as petrol),
- natural gas or
- aviation turbine fuel

(g) where the supply of goods being transported is treated as no supply under Schedule III of the Act. 

(h) where the goods are being transported -

(i) under customs bond from an inland container depot or a container freight station to a customs port, airport, air cargo complex and land customs station, or from one customs station or customs port to another customs station or customs port, or

(ii) under customs supervision or under customs seal.

(i) where the goods being transported are transit cargo from or to Nepal or Bhutan;

(j) where the goods being transported are exempt from tax under - 

- notification No. 7/2017-Central Tax (Rate), dated 28th June 2017 as amended from time to time - notification No. 26/2017- Central Tax (Rate), dated the 21st September, 2017 as amended from time to time 

(k) any movement of goods caused by defence formation under Ministry of defence as a consignor or consignee.

(l) where the consignor of goods is the Central Government, Government of any State or a local authority for transport of goods by rail.

(m) where empty cargo containers are being transported.

(n) where the goods are being transported upto a distance of twenty kilometers for weighment

- from the place of the business of the consignor to a weighbridge or
- from the weighbridge back to the place of the business of the said consignor

subject to the condition that the movement of goods is accompanied by a delivery challan issued in accordance with rule 55.

ANNEXURE

[See rule 138(14)]