Who is restricted?

• Registered persons: These restrictions apply to any registered person involved in the movement GST Act, 2017of goods, including consignors, consignees, transporters, e-commerce operators, and courier agencies.
• Non-compliers: The restrictions specifically target registered persons who haven’t fulfilled their return filing requirements for a certain period.

What are the restrictions?

• No generation of EWB: No person can generate an Electronic Way Bill (EWB) in Part A of FormGST Act, 2017 GST EWB-01 for goods transported byGST Act, 2017 a non-compliant registered person.
• Conditions for exemption: The Commissioner can grant permission to generate EWBs under specific circumstances, such as:
  • On application by the non-compliant person, showing sufficient cause and providing reasons inGST Act, 2017GST Act, 2017
  • Subject to conditions and restrictions specified by the Commissioner.
  • After affording the non-compliant person a fair hearing in case of rejection.

What are the non-compliance scenarios?

There are three main scenarios where these restrictions apply:

1. Non-filing of GST CMP-08: A person paying tax under section 10 (composition scheme) who hasn’t filed Form GST CMP-08 for two consecutive quarters.
2. Non-filing of GSTR-3B or GSTR-1: A person other than those under the composition scheme who hasn’t filed GSTR-3B returns or statements of outward supplies in Form GSTR-1 for two consecutive tax periods.
3. Registration suspension: A person whose GSTGST Act, 2017 registration has been suspended under specific provisions.

Temporary exemption during COVID-19:

• A temporary exemption existed from March 2020 to October 2020, where these restrictions GST Act, 2017didn’t apply for non-filing during the period February to August 2020 due to COVID-19 disruptions.

Additional notes:

• The Commissioner can also conduct physical verification of vehicles carrying goods, even GST Act, 2017without generating an EWB, if suspicion of tax evasion arises.
• For detailed information and any recent updates, it’s advisable to refer to the relevant notifications issued by the GST Council and official GST portals.

                                       EXAMPLE

General restrictions:

• Non-filing of returns: A registered person cannot generate an e-way bill for outward movement of goods if they haven’t filed the Goods and Services Tax (GST) returns (GSTR-3B) for two GST Act, 2017consecutive tax periods.
• Non-filing of outward supply statement: Similarly, if a registered person hasn’t filed the statement of outward supplies (GSTR-1)GST Act, 2017 for any two months or quarters, they cannot generate an e-way bill.
• Suspension of registration: If a registered person’s GST registration is suspended under provisions of Rule 21A, they cannot generate an e-way bill.

Additional restrictions for specific categories of taxpayers:

• Composition taxpayers: These taxpayers, falling under Section 10 of the GST Act, have additional restrictions. They cannot generate an e-way bill if they haven’t filed the composition GST Act, 2017scheme statement (GST CMP-08) for two consecutive quarters.

Exemptions to the restrictions:

• The Commissioner of State Tax or Union Territory Tax can grant permission to generate an e-GST Act, 2017way bill even if the above restrictions apply, upon receiving an application in Form GST EWB-05 and being satisfied with sufficient cause shown.
• During specific periods, as notified by the government, GST Act, 2017the restrictions may be temporarily lifted. For example, in 2020, due to the pandemic, the restrictions were waived for a certain period.

Please note: These are just some examples, and the specific provisions may vary depending on the type of taxpayer and the state in which they are registered. For the most up-to-date GST Act, 2017 information, it’s always advisable to consult the official GST website or seek guidance from a tax professional.

                                         FAQ QUESTIONS

1. Who is restricted from furnishing information in Part A of Form GST EWB-01GST Act, 2017?
2. Rule 138E of the CGST Rules, 2017 restricts certain registered persons from furnishing information in Part A of the e-way bill. This applies to:

• Tax defaulters: Any registered person GST Act, 2017 who has not filed GST returns for a specified period (currently, the previous three months) cannot be part of an e-way bill as either supplier or recipient.
• Persons availing specific composition scheme benefits: Registered persons under certain GST Act, 2017composition schemes, like Notification No. 02/2019 – State Tax (Rate), dated 7th March 2019, are also restricted unless notified otherwise.

1. What are the conditions for lifting the restriction?
2. The Commissioner of State or Union Territory Tax can grant permission to furnish information in Part A on a case-by-case basis if they are satisfied with the reasons for non-compliance. The GST Act, 2017applicant has the right to be heard before a decision is made.
3. Are there any temporary exemptions to the restriction?
4. Yes, there was a temporary exemption for the period from May 1, 2021, to August 18, 2021, for cases where specific GST returns couldn’t be GST Act, 2017 filed for March-May 2021. Currently, there are no active temporary exemptions.
5. What are the consequences of trying to generate an e-way bill when restricted?
6. The system will not allow generating an e-way bill if the supplier or recipient is under the restriction. Attempting to bypass the restriction could lead to penalties under the GST A

 CASE LAWS

1. Who is restricted from furnishing information in Part A?

No person can furnish information in Part A of the e-way bill for a registered person who:

• Has not filed GST returns (GSTR-3B or GSTR-1) for the previous three months.
• Is availing the benefit of Notification GST Act, 201702/2019-State Tax (Rate), dated 7th March 2019 (Maharashtra Government Gazette) and has not complied with the conditions mentioned in the notification.

2. What types of registered persons are affected?

This restriction applies to all registered persons under the GST Act, regardless of their turnover GST Act, 2017or business activity.

3. Are there any exceptions to the restrictions?

The restrictions are relaxed in certain situations:

• The period from May 1st, 2021, to August 18th, 2021, was exempt from this restriction.
• If the registered person GST Act, 2017 has a legitimate reason for not filing returns for the previous three months, they may apply to the Commissioner for permission to furnish information in Part A.

4. What are the consequences of violating the restrictions?

Furnishing information in Part A for a restricted registered person may attract penalties and legal action under the GST Act. GST Act, 2017

5. Where can I find more information about the restrictions?

The official GST Act, 2017notification for Rule 138E can be found on the Central Board of Indirect Taxes and Customs (CBIC)