NOTE on IMPACT OF E-Way bill in Logistic

companies.
Logistic and Transport Companies Issues regarding E-way bill
1. Validity of E-way bill:
 A report by EY and RAI published in December 2013 clearly states that the average
speed of Indian truck drivers is 20-40 km/hour, and the average distance covered daily
is 250-400 kms. Compare this to the average speed of 60-80 km/hour and daily
distance of 500-800 kms that truck drivers cover in developed countries and the
problem becomes apparent. It needs to be seen how realistic these timelines will be.
Besides, truck industry is very fragmented and rid with theft and driver downtime.
 To transport heavy machinery like a Boiler on a specialized truck, the number of days
it may take for it to cover 500 km can be much more than 10 days.

2. Change in Mode of Transport

 E-com retailers use several modes of transport to ensure that goods reach their
required destination from the warehouse or the manufacturer’s location. Thus they
end up generating large numbers of E-way bills.
 Many a times customers end up cancelling orders even while the goods are in transit,
or return goods already purchased. Fresh e-way bills have to be generated each time
this happens. E-com retailers who use third party logistics will be able to generate e-
way bills only when the transporter also uploads details on the GSTN, which can
cause potential delays in shipment.

3. IT infrastructure :
 According to KPMG, Indirect Tax Partner, Priyajit Ghosh, the specific validity of
way bills is a huge problem. "The stringent requirements will make things difficult,".
"The way bills will be a significant challenge in terms of the IT infrastructure for
companies. Unlike a return, a way bill needs to be generated in real time along with
the invoice. Unless a company has the IT system to support and generate way bills in
real time, it will be a huge issue. We have very less time to get the necessary
infrastructure up,"
 The fact that it can all be done online aligns well with the dream of a digitised
economy. But realistically speaking, ensuring that every transporter - especially in the
smaller towns - knows how to use the GSTN portal properly will be a headache for
the government.
 Internet connectivity in India, especially while on the go, is also an issue so there is no
guarantee that transporters will be able to use the GSTN portal to address their
grievances (If any) while on the road. The same goes for the RFIDs and RFID
readers. The idea of an automatic mode of verification for transport vehicles at major
checkpoints seems very ideal, but ensuring this delivers may be difficult.
 Blue Dart also flagged the lack of clarity in handling multi-modal transport of goods
since an e-way bill would be required for air and rail transport of goods as well.
Companies who feel E-WAY BILL IS Advantageous:

 Chander Agarwal, MD of TCI Express :E-Way bill will be of benefit to organised

sector, he said”It will slowly weed out the unorganised segment which is a major
revenue loss factor for the government, he added. If the unorganised players cannot
keep up with any of these GST changes or the e-way bill then the customers would
get affected and they would want organised players like us to come in and provide
them the services”.
 Chander Agarwal, Managing Director, TCIEXPRESS, said the provision will benefit
the government and transporters. “While it allows government to keep a tab on the
movement of goods to be transported, it will also allow transporters to file a
complaint if the vehicle is detained for a period exceeding 30 minutes. The e-way bill
portal allows the transporter, supplier and the recipient to be on a single platform
through which tracking of goods will be enabled through Radio Frequency
Identification ,As an organised player we believe also that this move by the
government will help to help regularise the unorganised sector as well as curb
malpractices.”
 Jugnoo, a start-up, welcomed e-way bills and even said it was planning to launch
“something in this domain”. “Recommendation of e-way bills for inter-State
movement of goods is a remarkable initiative as it will enable standardisation of
processes and bring transparency in the system. This proposal has immense potential
to completely root out the corrupt practices in this sector,” Samar Singla, CEO and
Founder, Jugnoo.
 Anjani Mandal, CEO and co-founder, 4TiGO, another start up, said: “The advance
declaration of goods being carried to authorities creates the platform and grounds for
"low-risk" consignments to be treated differently and let through all check-posts.
 "The introduction of the e-way bill would not only help the tax authorities to monitor
inter-state and intra-state movement of goods but also help reduce transportation time
by reducing loss of time at check posts. It is also expected to help the dealers who do
inter-state transactions in multiple states as the e-way bill process will now be
common across states. However, to avoid any issues on the ground, the government
can consider some field trials on test basis before implementation," said R
Muralidharan, senior director, Deloitte India.

Logistic companies who feel concern about E-Way Bill:

 Ecomm Express said: “In certain cases where the seller does not generate an e-way
bill, it is the transporter which has to do it. This implies that the logistics firm needs to
gather all the information about the products, including price, to be mentioned in the
bill. This could lead to delay in shipment.”
 According to Vikash Mohan, head, ground operations, Blue Dart, “For generating an
e-way bill, a transporter has to manually capture the GST identification number of
shipper and recipient in case of B2B transactions and only of the shipper in case of
 B2C, along with invoice number and date and HSN (Harmonised System of
Nomenclatures) codes of the products. This will then have to be posted on the GSTN
portal to get the e-way bill number.”
 Under the VAT regime, there was no such process for intra-state movements, even
though some states like Uttar Pradesh and Kerala had a system of road permits to
track goods movement. Bihar had a Suvidha form resembling the proposed e-way bill
and hence businesses there should be able to adapt to the new mechanism, Anand Rai,
director at Pigeon Express said.

Conclusion
Many logistic companies in organised form feel it will be win win situation for them as
well as Government. As they will we able to work efficiently in abolition of Inspector Raj
and for government it will increase indirect tax collection as it will curb malpractices.
But some companies like Ecom Express feels that it will add burden to them as many
provision of E-way bill is not clear and IT infrastructure of country is not robust. Many
companies are eager to see how E-way bill system will work when it will run in trial basis
period in January 2018. But Success of E –Way bill in Karnataka is silver lining in case
of E-way bill.