Question – How to generate E-way bill in case of Bill to-Ship to transactions?

Answer – In certain cases, it might happen that the invoice is being raised on one person, while goods are shipped to another person. This model is known as “Bill to”-“Ship to” model. E-way bill system provides the interface to handle the supply being made under this model.

E-way bill form provides for two options of entering details wherein details of Bill to party can be entered along with details of Ship to party. On the left-hand side,  GSTIN and trade name of “Bill to” party is entered while on the right-hand side, Address and Pincode of “Ship to” party are furnished.

In case of Bill to Ship to Transaction, tax components are determined on the basis of the location of supplier and location of billing party. If the supplier is in State A and the “Bill to” party is in State B, then IGST shall be levied irrespective of the fact whether goods are moving interstate or intra-state. Similarly, if supplier and party which is being billed are in the same state, then CGST and SGST shall be levied, irrespective of the fact whether goods are moving interstate or intra-state.

There have also been controversies wherein it has been interpreted that two E-way bills shall be prepared in case of such transactions. One E-way bill shall be prepared by the supplier furnishing the details of billing party(in whose name Tax invoice is being issued) in the “ship to” column on the right-hand side. Other E-way bill shall be prepared by the Bill to party indicating the details of final recipient of goods (i.e. : Ship to” party) in the “ship to” column on the right-hand side. But, CBEC FAQ’s provide for the method explained above initially and thus we suggest that E-way bill shall be generated as per the same.

Get all updates on E-way bill at TaxGrid.