E-way bill glitch doesn’t mean tax evasion
If your goods are delayed or seized during transit due to a missing e-way bill caused by a technical glitch, you are still protected— as long as there’s no intent to evade tax. This principle has been reaffirmed by several High Court rulings, making it crucial for businesses to understand their rights and obligations under GST law.
Let’s break it down simply.
When is detention of goods under GST legal?
As per Section 129 of the CGST Act, 2017, goods in transit can be detained if:
- There is no proper documentation (e.g., invoice or e-way bill), and
- There is intent to evade tax
But if the e-way bill couldn’t be generated due to a system error—despite having valid invoice, payment proof, and no malafide intent—then detention is not valid.
Keyphrase subheading: E-way bill glitch and GST compliance
Here’s what the law and courts say:
- Rule 138 of CGST Rules mandates e-way bills for specified movement of goods.
- But mechanical application of rules, especially where technical errors prevent generation, has been ruled unfair by courts.
✅ Case in Point:
Kerala High Court – Goods detained despite payment
In Sasi Enterprises v. State Tax Officer, 2022, the court held that mere non-generation of e-way bill due to portal error, when the invoice, tax payment, and transport details were intact, did not indicate tax evasion.
✅ Madras High Court view
In A1 Chips & Exports v. Assistant Commissioner (ST), 2021, detention was quashed since the petitioner had already paid tax and the lapse was inadvertent, not deliberate.
Practical checklist: What to do if e-way bill fails
If your e-way bill couldn’t be generated due to a technical issue, follow these steps:
- Take screenshots of the portal showing error
- Retain invoice and payment proof
- Attach transport details (vehicle number, LR copy, etc.)
- Inform jurisdictional officer via email or GST helpdesk ticket
- If detained, file a representation citing CBIC Circular No. 64/38/2018-GST which allows leniency for genuine cases
Expert view: Don’t panic—document everything
“Taxpayers should not panic if the e-way bill couldn’t be generated due to system errors. The intent and documentary trail matter more than technical perfection. Just maintain transparency and record everything in writing.”
— CA Manoj Jain, GST Consultant
What CBIC says
CBIC Circular No. 64/38/2018-GST dated 14.09.2018 clarifies:
Minor errors in documentation should not attract Section 129 action if tax has been paid and there’s no intent to evade.
This includes technical or clerical errors, especially if the taxpayer can prove bonafide conduct.
Quick Table: When GST detention is legal vs illegal
| Situation | Detention Legal? | Remarks |
|---|---|---|
| No e-way bill + tax unpaid | Yes | Assumed tax evasion |
| E-way bill error + tax paid | No | Supported by court rulings |
| Wrong vehicle number in e-way bill | No | Treated as minor clerical error |
| Portal not working + invoice available | No | Technical glitch; document trail key |
Summary
Goods cannot be detained under GST solely due to a missing e-way bill caused by a technical glitch, if there’s no tax evasion intent. High Court rulings and CBIC guidelines support relief for genuine taxpayers.
FAQs
Q1. Can the GST officer still demand penalty if e-way bill was not generated?
A: Not if the lapse was due to technical reasons and there’s proof of tax paid, valid invoice, and transport documents.
Q2. What should I do if my goods are detained without valid reason?
A: File a written reply citing court rulings and CBIC Circular No. 64/38/2018-GST. Approach HC under Article 226 if needed.
Q3. Can I avoid detention entirely?
A: While not guaranteed, having real-time documentation, portal screenshots, and proactive communication with authorities helps you avoid penalties.
Final Thoughts
GST compliance is not just about forms—it’s also about fairness. If you’ve paid your taxes and documented your transactions well, a technical glitch shouldn’t be held against you.
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