Inter-State GST e-way bill rules cannot be imposed by a State, and detention for non-generation was restrained.

For inter-State GST supplies, the State cannot prescribe an additional recipient-State e-way bill requirement or authorise detention of goods and vehicles for non-compliance with it, because Article 246A gives Parliament exclusive competence over inter-State GST and the IGST framework governs such movement. Rule 138 of the State GST Rules was treated as confined to intra-State movement, so the impugned State orders could not validly extend to inter-State transactions. On that prima facie basis, interim protection was granted against detention solely for want of a recipient-generated e-way bill, subject to bond conditions and reporting directions to guard against tax evasion.

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Issues: (i) Whether the State Governments had jurisdiction to prescribe e-way bill requirements and seize or detain goods in respect of inter-State movement of goods and services. (ii) Whether interim protection should be granted against detention of goods and vehicles merely because the goods were not accompanied by an e-way bill generated by the recipient dealer in the receiving State.

Issue (i): Whether the State Governments had jurisdiction to prescribe e-way bill requirements and seize or detain goods in respect of inter-State movement of goods and services.

Analysis: Article 246A confers exclusive legislative power on Parliament in relation to goods and services tax where the supply takes place in the course of inter-State trade or commerce. The Integrated Goods and Services Tax Act, 2017 governs such inter-State supplies, while the Central Goods and Services Tax Rules, 2017 contain the scheme for e-way bills. Rule 138 of the State Goods and Services Tax Rules was treated as applicable only to intra-State movement, and the State Government orders could not validly extend a recipient-State e-way bill requirement to inter-State transactions.

Conclusion: The State Governments lacked jurisdiction to regulate inter-State movement of goods and services by the impugned e-way bill requirements, and the State G.Os. were not enforceable to that extent.

Issue (ii): Whether interim protection should be granted against detention of goods and vehicles merely because the goods were not accompanied by an e-way bill generated by the recipient dealer in the receiving State.

Analysis: On the prima facie view that the State-level requirement could not govern inter-State movement, detention of goods and vehicles only for want of an e-way bill generated by the recipient dealer was considered impermissible. At the same time, protective conditions were framed to address possible tax evasion, including release on bond and communication of interception details to the concerned tax authorities.

Conclusion: Interim protection was granted, and detention on that ground was held not permissible, subject to the bond and reporting directions issued.

Final Conclusion: The order provisionally protected inter-State consignments from seizure or detention solely for non-generation of a recipient-State e-way bill and indicated that the impugned State requirements could not operate against inter-State movement pending further consideration.

Ratio Decidendi: In matters of inter-State GST supply, the State cannot, by its own rules or orders, impose an additional e-way bill condition or authorize detention of goods contrary to the exclusive Parliamentary competence under Article 246A.

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