Query Regarding Issuance of Multiple E-Way Bills in Bill-to Ship-to Transaction

[Lav Prajapati]

Dear Sir/Madam,

I would like to seek clarification regarding the compliance requirements for issuance of e-way bills in a 'bill-to ship-to' transaction involving multiple parties.

Facts of the case:

• Mr. A raises an invoice on Mr. B on a 'bill-to ship-to' basis.
• The goods are directly shipped to the ultimate recipient (as per instructions of Mr. B), and an e-way bill is generated by Mr. A for such movement.
• Subsequently, Mr. B raises an invoice on Mr. C for the same goods.
• Mr. B also generates a separate e-way bill for the same consignment, even though there is only one physical movement of goods.

Query:
In the above scenario, two e-way bills have been generated for a single movement of goods:

1. One by Mr. A (supplier to Mr. B - bill-to ship-to)
2. Another by Mr. B (supplier to Mr. C)

Kindly clarify:

• Whether issuance of two e-way bills for a single movement of goods is permissible under GST law.
• If yes, what is the correct procedure to be followed to ensure compliance.
• If not, which party is required to generate the e-way bill and how should the transaction be properly documented.
• what are consequences may face by the party) like interest, penalty or reversal of ITC)

Your guidance on the above matter will be highly appreciated.

Thanking you

[Pinnacle Tax Advisor]

As material was moved from Location A to Location C, a single e-way bill was required to be issued either by A or B for the movement. As the material had already been moved, there was no requirement for B to raise an additional E-way bill to C since no further movement occurred.

If a duplicate e-way bill has been raised, it may be cancelled within the permissible limit of 24 hours. If cancellation is not possible, a submission may be made declaring that the second e-way bill was raised mistakenly. It should be clarified that the movement of material was completed through the first transaction itself - i.e., a "bill-to, ship-to" transaction billed by A to B and shipped to C.

If you don't cancel or don't make any submission, deparment may raise the demand on B treating it seperate transaction on basis of E-way on which tax was not paid and not declared in GSSTR-1

[YAGAY andSUN]

In a "bill-to-ship-to" transaction, there are two supplies but a single physical movement of goods. The legal framework under CGST Rules, 2017 (Rule 138) permits such structuring, subject to proper documentation.

As clarified vide CBIC Circular No. 47/21/2018-GST, only one e-way bill is required for a single movement of goods, even though two invoices may exist (A B and B C).

Two alternative compliant procedures are recognized:

First, the supplier (Mr. A) may generate the e-way bill by reflecting:

• "Bill To" as Mr. B, and

• "Ship To" as Mr. C,
  based on invoice A B.

Alternatively, Mr. B may generate the e-way bill by reflecting:

• "Bill From" as Mr. B,

• "Dispatch From" as Mr. A, and

• "Ship To" as Mr. C,
  based on invoice B C.

In either case, duplication of e-way bills for the same consignment and movement is not envisaged under the law and may lead to inconsistencies in compliance records.

Issuance of two e-way bills for a single movement may expose the parties to proceedings under Section 122 of CGST Act for improper documentation, particularly if it creates ambiguity regarding the nature of supply or movement.

Further, discrepancies may result in detention of goods under Section 129 of CGST Act, if the proper officer forms a view that the documents carried are not in order.

While mere duplication may not automatically result in denial of input tax credit, in cases where the transaction is questioned as non-genuine, consequential exposure may arise, including interest under Section 50 of CGST Act.

Accordingly, the legally tenable position is that only one e-way bill should be generated for the movement, by either Mr. A or Mr. B, with correct declaration of "Bill To-Ship To" particulars and corresponding invoices maintained for audit trail.

AI Summary

Bill-to ship-to e-way bill compliance in a single goods movement raises questions on documentation and multiple bill issuance. Clarification is sought on e-way bill compliance in a bill-to ship-to transaction where goods are directly shipped to the ultimate recipient. The issue is whether two e-way bills can be issued for a single movement of goods, which party must generate the e-way bill, how the transaction should be documented, and whether any consequences such as interest, penalty, or reversal of ITC may arise.