GST e-Way Bill under Rule 138 — thresholds, validity, cancellation

When e-Way Bill is mandatory

Generated by the supplier (or transporter / recipient in certain cases) before goods are moved if:

• Consignment value > ₹50,000 (including tax, excluding exempt portion)
• Movement is in relation to: supply, reasons other than supply (e.g., job-work, branch transfer), inward supply from unregistered

Some states have lower intra-state thresholds — Tamil Nadu: ₹1 lakh for select commodities; Bihar / West Bengal / others: ₹1 lakh for many categories. Check your state notification.

What goes on the e-Way Bill

Form GST EWB-01 has two parts:

• Part A (mandatory): GSTIN of supplier + recipient, invoice number, date, value, HSN, reason for transport, transporter ID
• Part B (mandatory before movement): Vehicle number OR transporter document number (Lorry Receipt / Bilty)

Part A without Part B = goods can't move. Generated separately because Part A often pre-printed at invoice time, Part B updated when actual vehicle is decided.

Validity — distance-based formula

Distance	Validity (normal cargo)	Validity (Over-dimensional cargo)
Up to 200 km	1 day	1 day
Every additional 200 km	+1 day	+1 day (per 20 km for ODC)

So a Chennai → Bengaluru consignment (350 km) = 2 days validity. Chennai → Delhi (~2,200 km) = 11 days. ODC (over-sized — e.g., heavy machinery) gets stricter 20 km/day clock.

"Day" is calculated from midnight to midnight, NOT 24 hours from issuance. e-Way Bill generated at 11pm has effectively 1 hour of "Day 1" before midnight rolls in.

Extending validity

If the consignment can't reach destination within validity (truck breakdown, delay, route change), you can extend the e-Way Bill — but only:

• Within 8 hours before expiry OR 8 hours after expiry
• By the transporter or by the original generator
• With a reason — system has predefined categories

Miss the 8-hour-after window and the e-Way Bill is dead. Goods continue on a dead Bill → detention if intercepted.

24-hour cancellation window

If a transaction falls through (sale cancelled, customer rejects, wrong vehicle assigned), the e-Way Bill must be cancelled within 24 hours of generation. After 24 hours, it's locked and cannot be cancelled — only allowed to expire.

Critical: an active but uncancelled e-Way Bill becomes evidence of an unreported outward supply. The AO can demand: "where's the GSTR-1 entry for this e-Way Bill?" If the goods didn't actually move, you have no GSTR-1 entry → reconciliation gap.

Vehicle change mid-journey

If the goods are transhipped (truck breaks down, sealed-container split), the transporter must update Part B with the new vehicle number via the portal. No re-generation needed; just update.

The 7 reasons consignments get detained

1. e-Way Bill not generated (above threshold)
2. e-Way Bill expired (validity over, not extended)
3. Vehicle number on Bill doesn't match the actual transport
4. HSN code mismatch on the invoice vs e-Way Bill
5. Material description doesn't match physical inspection (e.g., declared "rice", actually "fabric")
6. Value mismatch (under-invoicing detected)
7. Multiple consignments on one e-Way Bill (or one consignment split across multiple Bills inappropriately)

Detention process

If officer detains under Sec 129:

1. Issues Form MOV-01 (intimation of detention)
2. Within 7 days, issues Form MOV-07 (notice for tax + penalty)
3. Tax = applicable GST rate on the goods. Penalty = 100% of tax payable (for taxable supplies) or 25% of value (for exempt)
4. Release: either pay the tax + penalty, OR furnish a bank guarantee for the same
5. If unresolved within 14 days, goods can be confiscated under Sec 130

You have the right to appeal within 30 days. The appeal route is now faceless via DRC-03 + appellate authority.

e-Way Bill vs e-Invoice — different beasts

Don't confuse:

• e-Invoice — IRN generation on the IRP for every B2B invoice (mandatory for businesses > ₹5 Cr turnover, see our brief)
• e-Way Bill — separate movement document, generated for every consignment > ₹50K

e-Invoice happens before / at invoice generation. e-Way Bill happens before goods movement. They're linked (e-Invoice auto-populates Part A of e-Way Bill if integrated) but logically distinct.

The Finclar take

e-Way Bill is the lowest-effort highest-risk piece of GST compliance. Generating one takes 90 seconds; missing one costs ₹10K-₹1 L per consignment. The discipline failure is almost always at the dispatch desk — someone forgets, the driver leaves, the truck gets stopped. The fix is procedural: any goods leaving the warehouse without an e-Way Bill printout taped to the invoice is the dispatch clerk's accountability. We've helped clients move from "monthly detention call" to "zero" with this single SOP change.