Some facts about logistics industry in India
Given the complex structure the
transport industry ends up spending 30-64% of its time and resources on tax
compliance, out of which nearly 16% of its time is spent by the trucks queuing
up at interstate check points for tracking and inspection according to a report
by ministry of road transport and highways.
A truck in India covers an annual
average distance of 85,000 km as compared to 1,50,000 to 2,00,000 km in
advanced countries which pose a clear indication that our logistics industry
needs some reforms. Now the introduction of GST is expected to increase the
need for integrated logistics arrangements as companies decrease the number of
warehouses they keep up in different states. The changes achieved by GST are
likewise expected to solve one of the significant problems this sector faces –
the inter-state transport of goods without the hassle of documentation and long
holding up queues at check posts. The GST Council and CBEC’s answer to this
problem is the GST E way Bills which will replace the waybills and transport
bills that transport companies use today.
Compliance related to E-Way bill
Compliance has been the bane of
the Indian logistics industry for some time now. The waybills obtained
currently from VAT authorities are famous for restricting movement of goods
crosswise over states. While e-way bills should help in free-stream of goods,
it does not mean that transporters don’t need to take after rules anymore. The
CBEC has already released a detailed guideline on the use of e-way bills which
drill down the accompanying compliances:
new e-way bill must be generated whenever the mode of transport of a
consignment is changed. a1
more than one consignment is transported crosswise over state borders, the
serial number for the e-way bill associated with each consignment must be
indicated on the regular entrancea2 .
bills generated for goods not transported must be canceled inside 24 hours.
They can’t be canceled if verified amid travel.
of the consignment must accept or reject the bills. The system will assume the
bill has been accepted if no alternate correspondence is provided inside 72
person-in-charge of the conveyance must convey certain documents, for example,
the invoice or bill of supply for verification.
transporter can likewise convey the details of the e-way bill on a RFID device
(Radio Frequency Identification Device).
verification of the consignment should be possible if there is any ‘specific
data’ relating to tax avoidance or some other malpractice. Otherwise, goods
once verified can continue unimpeded through the rest of the journey.
officers would need to present a rundown of inspection inside 3 days of
verifying a consignment.
will have the privilege to transfer queries on the GSTN entrance if their
vehicle is detained for more than 30 minutes without substantial reason.
bills will be substantial just for certain period of time
Impact of e-way bill on logistics
Let us toss some light on the
effect of e-way bill on the logistics industry. the e-way bill recording
promises better revenue utilizing the benefits of Information Technology. It is
additionally expected that the E-way bill mechanism would be an effective
instrument to track movement of goods and check tax avoidance and will ensure
that goods being transported follow the GST Law.
The E-Way Bill promises multiple
benefits for the transporters. The advantages of E-Way Billing can be summarized
along these lines:
Reduce Documentation – All the existing state-wise documentation
required for movement of goods will never again be required. Another beneficial
alternative that is available for the transporters is the establishment of RFID
device in the vehicle used to transport consignments on a regular premise. The
person in charge of the vehicle never again needs to convey physical copies as
the device is attached to the vehicle and the e-way bill can be mapped and
verified through the device itself.
Quicker movement of Consignment – Another huge advantage of E-Way
Billing will be the removal of the large number of check-posts crosswise over
state borders and national highways, resulting in ease of movement of goods.
Reduced Logistics Cost – E-Way Bill would reinforce proper
invoicing and along these lines would reduce tax avoidances. In the longer run
this bill is expected to reduce our Logistic cost to GDP proportion, which is
currently very high when compared to other countries.
Disadvantage of E-way Bill
However there are some
bottlenecks which are issues of concern for the logistics industry. Putting the
disadvantages of E-Way Billing in a nutshell we have :
Accessibility to IT Infrastructure – Small transporters especially
from provincial areas will face trouble in securing access to GSTN gateway for
generating the e-way bill. The government now faces the mammoth assignment of
ensuring that all transporters enormous or little from country or urban areas
do have access to internet even in a hurry.
Unless an organization has the IT
system to help and generate way bills in real time, it will be a huge issue. We
have very less time to get the necessary infrastructure up
Strict timelines for legitimacy of e-way bills. The guidelines
lied for E-Way legitimacy have been remarked to be unrealistic by some industry
experts. For example an e-way bill generated for a distance of 1000 kms is
substantial just for ten days from the date on which it is generated. However
research indicates that the average speed of Indian truck drivers is 20-40
km/hour, and the average distance covered every day is 250-400 kms. a3 Moreover
when heavy machinery like a Boiler or huge equipment like breeze process blades
are transported on a specialized truck, the number of days it might take for it
to cover 500 km can be significantly more than 10 days.
Keeping up multiple bills – E-commerce retailers use several modes
of transport to ensure that goods reach the customers from the warehouse or the
manufacturer’s area on time. Since a fresh e-way bill must be generated every
time the mode of transport is changed E-com will definitely end up generating a
large number of bills for every shipment.
Potential delays in generating e-way bills – Many a times customers
end up canceling orders even while the goods are in travel, or return goods
already purchased. Fresh e-way bills have to be generated each time this
happens. This poses an issue for E-com retailers who use outsider logistics.
They will be able to generate e-way bills simply after the transporter
additionally transfers details on the GSTN, which can cause potential delays in
Summing up, we find that there
are expected positive effect of e-way bill and furthermore visible loopholes in
the realization of the vision of the bill. At this juncture when the e-bill is
in the genesis stage, it will be too soon to reach a determination with
reference to whether the advantages of e-way bill outweigh disadvantages or
vice-versa. Implementation is the key and that would decide what e-way bill
would end up being!!
in easy language
for 1000 kms 10 days is allowed and daily travelling we suppose minimum 250 km
then transporter can cover 1000 km in 4 days then what disadvantage in this?