Government Tightens Noose on Tax Evasion with E-Way Bill System Overhaul

Government Tightens Noose on Tax Evasion with E-Way Bill System Overhaul

• Systemic Overhaul InitiatedThe Government of India has implemented comprehensive corrective measures to strengthen the GST e-way bill ecosystem. This action follows observations by the Comptroller and Auditor General of India (CAG) regarding systemic deficiencies in the framework.
• Key Flaws IdentifiedMinister of State for Finance, Shri Pankaj Chaudhary, highlighted major issues such as the generation of multiple e-way bills for a single invoice, e-way bill generation by taxpayers who haven’t filed returns, and the use of cancelled GSTINs to generate bills.
• Duplicate Prevention MechanismTo curb misuse, new technological validations ensure that more than one e-way bill cannot be generated for the same invoice number and date. Additionally, documents older than 180 days are now restricted from being used to generate e-way bills.
• Blocking Non-Compliant TaxpayersThe system now automatically checks filing status and blocks e-way bill generation for taxpayers who have failed to file their GST returns for the previous three periods.
• Safeguards Against Cancelled EntitiesStrict system checks have been deployed to prevent the generation of e-way bills by or for entities whose GSTINs have been cancelled, ensuring that fraudulent logistics movements are halted.