Role of Fastag in movement of goods under GST

INTRODUCTION

Goods, as well as services, have been defined in the GST Law. The securities are excluded from the definition of goods as well as that of services. Money is also excluded from the definition of goods as well as services, however, activities relating to the use of money or its conversion by cash or by any other mode, from one form, currency or denomination, to another form, currency or denomination for which a separate consideration is charged are included in services.

Movement of goods may include the sending of goods from one place to another either within India or abroad. Domestic transportation is the transportation of goods from a place in India to another place in India. In this case, both the point of origin and the point of destination should be located within India. In this manner, international transportation is a transportation of goods wherein either the origin or the destination or both are outside India. Consigner, receiver and transporter are the three parties involved in the movement of goods. An approval by the receiver is needed before commencing the movement of goods.

MEANING OF SUPPLY

The term, “supply” has been inclusively defined in the Act. The meaning and scope of supply under GST can be understood in terms of following six parameters, which can be adopted to characterize a transaction as supply:

• Supply of goods or services. Supply of anything other than goods or services does not attract GST
• Supply should be made for consideration
• Supply should be made in the course or furtherance of business
• Supply should be made by a taxable person
• Supply should be a taxable supply
• While these six parameters describe the concept of supply, there are a few exceptions to the requirement of supply being made for a consideration and in the course or furtherance of business. Any transaction involving supply of goods or services without consideration is not a supply, barring few exceptions, in which a transaction is deemed to be a supply even without consideration. Further import of services for a consideration, whether or not in the course or furtherance of business is treated as supply..

E Way Bill

Electronic Way Bill (e-way bill) has to be generated for the movement of goods. Every registered person who causes movement of goods of consignment value exceeding fifty thousand rupees shall furnish information relating to the said goods in PART A of FORM GST INS-01 electronically, on the common portal. E-way bill will also be allowed to be generated or cancelled through SMS. When an e-way bill is generated a unique e-way bill number (EBN) is allocated and is available to supplier, recipient, and the transporter.

DOCUMENTS FOR SUPPLY

Section 31 to 34 of CGST Act, 2017 along with Tax Invoice, Credit and Debit Note Rules are the governing law for the purpose of documents of supply of Goods/ Services. As per Section 31(1) a registered person is required to raise invoice before or at the time of removal of goods. As per section 31(2) of CGST Act, 2017, a registered person is required to raise invoice for supply of services before or within 30 days from date of providing of services. Section 31(3) deals with Revised Invoice, Bill of Supply, Receipt Voucher, Refund Voucher, Payment Voucher and Invoice as Recipient. Section 32 says unregistered person will not collect tax. Section 33 says tax amount is required to be shown separately on the invoice. Section 34(1) deals with Credit Note and Section 34(2) deals with Debit Note.

IMPORTANT DOCUMENTS RELATING TO SALE AND PURCHASE IN GST

Over and above presently one more documents required by department is Toll Receipt to prove movement of goods. If the information in not received from IHMCL particular commercial vehicle. But it is not listed in the Section u/s 31 to 34.

IMPORTANCE OF FASTAG IN MOVEMENT OF GOODS

Integration of FASTAG with the GST e-way bill system will enable the GST Council and the NHAI to:

• Track the movement of commercial vehicles
• Track the authenticity of all travel data supplied when filing GST
• Verifying e-way bills
• Implement prepaid e-wallet for paying parking charges, toll charges and fuel costs
• Partner with airports and other transportation hubs to offer parking services

Indian Highways Management Corporation Limited (IHMCL) and GST Network (GSTN) has signed a MoU for integrating the E-Way Bill system with Fastag. This will enable to overcome the difficulties in existing track and trace mechanism for GST E-Way Bill (EWB) System.

FASTAG REPORT TO GST DEPARTMENT

There are two types of TOLLS available in Indian systems. One is Toll under NHAI and other State Tolls. Some states close the State Tolls but some continue charging TOLL for the movement of vehicles. There are many ways where TOLLs are still not available; Likes inside the city or in villages where TOLLS are not available. Fastag information sends to the GST department only when a FASTAG payment is made through an online system. Where payment is made through cash or vehicle move from the road where TOLLS are not available and inside the villages or cities where no TOLL paid information is not updated in the Department server.

In this case where information is not updated in the GST department, Department Can issue the notice for supply without the movement of goods or where an invoice issued without supply l and Try to impose a penalty u/s 122 of GST ACT 2017 (Circular No. 171/03/2022-GST under which condition, which section will apply for a penalty on Supplier and Recipient)

DOCUMENTS REQUIRED IN ABSENCE OF FASTAG

The department can issue the notice in case of FASTAG information is not received at their end, in this case, the onus to prove on the supplier for justified their transaction. Following Documents will help to prove the supply of Transactions:

1. Tax Invoice/ E Invoice
2. Delivery Challan
3. Weight Slip Supplier Place
4. E way Bill
5. Weight Slip at Receiver Place
6. Payment Made by Receiver
7. GST paid by Supplier
8. Builty of Transporter
9. Affidavit of all three parties Involves in Transaction (Supplier, Receiver and Transporter)
10. Payment to Transporter (If Payment Through Bank vary helpful to justification)
11. GST paid under RCM on Freight

Above documents as basic documents as per Section 31 to 34 and sufficient for justified movement of Goods. All other documents which may help to prove movement of Goods will help to justification because Onus to proof only on Assessee.

CONCLUSION

Read with section 31 to 34 and Practical Aspects author view is Fastag is not a document to prove the movement of goods under GST (Goods and Services Tax) law in India. Under GST, the movement of goods is usually proved by the generation of an e-way bill, which is a mandatory document for the transportation of goods valued at more than INR 50,000 within India. The e-way bill contains details of the consignor, consignee, the goods being transported, the mode of transportation, and the vehicle number, among other details.

In addition to the e-way bill, other documents such as the invoice, delivery Challan, bill of lading, or transport receipt may also be required to prove the movement of goods under GST. The exact set of documents required will depend on the specific circumstances of the case, the nature of the goods being transported, and the laws and regulations in the jurisdiction in question.

Disclaimer :

These are author’s personal views and cannot be construed to be the views of the ICAI. It shall not be used for any legal advice/opinion and shall not be used to render any professional opinion/advice. The information contained in the article is for the purpose of spreading information/knowledge/ awareness and shall not be treated as solicitation in any manner or for any other purpose.