Eway Bill Disabled - Late Filing of GST Return

In order to streamline the

GST return filing process under GST, rule 138E has been inserted which prohibits the registered person from generating the GST eWay bill in case of non-filing of GST returns for a consecutive period of two months in case of monthly return filers or 2 quarters in case of quarterly return filers. The effect of the said GST Rule 138E is being taken up in the present article. Vide notification no. 74/2018 – Central Tax dated 31st December 2018, the Central Board of Indirect Taxes and Customs introduced the Central Goods and Service Tax (Fourteenth Amendment) Rules, 2018. Vide the said Central Goods and Service Tax (Fourteenth Amendment) Rules, 2018, rule 138E has been inserted into the Central Goods and Service Tax Rules, 2017. The said newly inserted rule 138E restricts furnishing of information in Part A of FORM GST in case of default.

Rule 138E of GST

Rule 138E of GST restricts the generation of eWay bill by not allowing the defaulters to furnish information in PART A of FORM GST EWB-01. The salient features of the same are being tabulated hereunder –

Category of Person	Restriction	Condition for Restriction
All persons (including consignor, consignee, transporter, an e-commerce operator or a courier agency)	Furnishing of information in PART A of FORM GST EWB-01	The restriction would be imposed if the supplier/recipient has defaulted as under: In case of composition scheme dealer, paying tax u/s 10 – Non-filing of the return for two consecutive periods; and In any other case – Non-filing of the return for a consecutive period of two months.

However, the rule provides that the Commissioner may allow generation of the eWay bill (i.e. furnishing of information in PART-A of FORM GST EWB-01) if the defaulter provides the sufficient cause for non-furnishing of returns. A copy of Central Goods and Service Tax (Fourteenth Amendment) Rules, 2018 is reproduced below for ready reference:

Effective Date of Rule 138E

As seen above, rule 138E has been inserted vide notification no. 74/2018 – Central Tax dated 31

st December 2018, however, as per the said notification, the effective date of rule 138E would be notified later. Vide notification no. 22/2019 – Central Tax dated 22rd April 2019, the Central Government has notified 21st June 2019 as the date from which the Central Goods and Service Tax (Fourteenth Amendment) Rules, 2018 shall come into force. Similarly, rule 138E restricting generation of E-way bill for non-filing of GST return would also be effective from 21st June 2019.

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Frequently Asked Questions

Common questions about GST Rule 138E: Impact on eWay Bill and Return Filing.

Rule 138E has been introduced to streamline the GST return filing process. It restricts the generation of e-way bills for registered persons who have not filed their GST returns for a consecutive period of two months (in case of monthly returns) or two quarters (in case of quarterly returns). This is aimed at ensuring compliance with return filing requirements.

Rule 138E applies to all registered persons under GST, including consignors, consignees, transporters, e-commerce operators, and courier agencies. If any of these parties have defaulted on filing GST returns for the specified period, they will not be able to generate e-way bills.

For composition scheme dealers paying tax under Section 10, the restriction on generating e-way bills will be imposed if they have not filed GST returns for two consecutive tax periods. For other registered persons, the restriction will apply if they have not filed returns for a consecutive period of two months.

Yes, the Commissioner has the authority to allow the generation of e-way bills (by allowing the furnishing of information in PART A of FORM GST EWB-01) if the defaulter provides a sufficient cause for not filing the returns.

Rule 138E was introduced through the Central Goods and Service Tax (Fourteenth Amendment) Rules, 2018, notified on December 31, 2018. However, the effective date for the implementation of this rule was notified later as June 21, 2019, through notification no. 22/2019 – Central Tax dated April 23, 2019.

The article does not explicitly mention the duration of the restriction. However, it can be inferred that the restriction will be lifted once the defaulter files the pending GST returns for the consecutive period of two months or two quarters, as applicable.

The restriction on e-way bill generation for non-filers is aimed at encouraging compliance with GST return filing requirements. By limiting the ability to generate e-way bills, it creates an incentive for registered persons to file their returns promptly and avoid potential disruptions to their business operations.

The article does not provide any information about the retrospective application of rule 138E. However, based on general legal principles, it is unlikely that the restriction would be applied retrospectively, as it would create uncertainty and potential legal challenges.

The article does not specifically mention any appeal provisions related to rule 138E. However, registered persons may be able to appeal the restriction or seek relief through the appropriate channels provided under the GST laws and regulations, such as filing a representation with the concerned authorities or seeking legal recourse, if necessary.

Rule 138E can significantly impact businesses that regularly transport goods, such as transporters, e-commerce operators, and courier agencies. If these entities fail to file GST returns for the specified period, they will not be able to generate e-way bills, which are mandatory for the movement of goods. This can disrupt their operations and supply chain, leading to potential losses and delays.