Non Genration of E-way Bill or genration of Incorrect E-Way bill , Impact on ITC

[umeshkumar jhawar]

A Trader situated in Nagpur ordered Goods from Mumbai and ask mumbai based vendor to generate the E-Way bill from Mumabi to Nagpur.

But he has general practis of delivering the same goods from Pune only. Here Nagpur based Taxpayer generate 2nd E-way bill mentioning travel route Nagpur to Pune though actual goods route was Mumbai to Pune.

Is 2nd E-Way bill generated is valid one? what impact on ITC of Pune Dealer?

[Amit Agrawal]

Both leg of transactions - purchase & sale - can be disputed by Dept. And said trader need to defend them based on solid evidences including third party evidences. It is better to take expert-help.

These are ex facie views of mine and the same should not be construed as professional advice / suggestion.

[Padmanathan KV]

I agree. Actually, the e-way bill needs to be generated under bill to-ship to model.

Bill to - Nagpur

Ship to - Pune

Therefore the practice followed by dealer is not correct.

Regarding ITC, all documentary evidences need to be maintained. These include

Purchase order/communication

Invoice copy

Payment details

Transport receipt/ loading-unloading receipt

Any other document to prove actual movement of goods

[Ganeshan Kalyani]

Input tax credit is governed by Sec. 16 /17(5) of CGST Act and in these section the requirement of e-way bill is not mentioned. Hence, there is no impact on ITC because of e-way bill error.

[Alkesh Jani]

Shri

I agree with the views of Shri Ganesh ji, to the extend that E-way Bill has no impact on ITC. E-way bill is a valid documents for movement of goods, for purpose of ITC documents prescribed therein are valid documents.

Thanks

[umeshkumar jhawar]

Thank You Amitji Agrawal, Padmanathanji Kollengode, Ganeshanji Kalyani & Alkeshji Jain for your valuable response.

After getting all the ansewer to my query here one thing is clear there is error in genration of E-Way Bill but there is no impact on ITC.

[Padmanathan KV]

Yes. Though there is no direct impact on ITC, e-way bill is an important documentary evidence for movement of goods and genuiness of the transaction. Kindly go through the recent SC decision in THE STATE OF KARNATAKA VERSUS M/S ECOM GILL COFFEE TRADING PRIVATE LIMITED - 2023 (3) TMI 533 - SUPREME COURT .

Nevertheless, E-way bills is not the only proof of movement of goods and if actual receipt can be established by other evidences such as stock records, freight receipt etc, ITC cannot be denied.

AI Summary

E way bill error does not bar input tax credit when alternative documentary proof establishes movement of goods. An incorrect or missing e way bill does not by itself negate entitlement to input tax credit because statutory ITC conditions do not mandate an e way bill; however, the e way bill is an important documentary proof of movement and genuineness. Taxpayers should use the bill to/ship to model where applicable and preserve alternative evidence - purchase orders, invoices, payment records, transport and loading receipts, stock records or third party confirmations - to substantiate actual movement when the e way bill is erroneous.