Advice to taxpayers regarding the establishment of an EWB where the primary supply is the supply of services.
One of the common issues faced by taxpayers who deal with a composite supply is where there is a need to ship the goods also when performing the service contract. To deal with this GSTN has issued an advisory on it.
1. Acknowledgments have been received from various trade bodies stating that they are unable to issue an EWB invoice for the movement of those goods as their primary supply can be classified as a service, as there is no provision for creating an E-way invoice by entering the SAC (Service Accounting Code – Chapter 99) alone on the electronic billing portal.
2. To overcome this problem, taxpayers are advised as follows:
a) Rule 138 of the CGST Rules 2017, among other things, provides, among other things, “Information to be provided before the commencement of the movement of goods and the creation of an Electronic Road Invoice.- (1) Every registered person causing the movement of goods whose consignment value exceeds fifty thousand rupees.. Thus, an electronic route invoice is required to be generated for the movement of goods.
b) Therefore, in cases where the main supply is merely a supply of the service and does not involve any movement of goods, the electronic road bill is not required.
c) However, in cases where the movement of some goods is also involved along with the main supply of the service, an invoice may be generated by the electronic method. Such situations may arise in cases of supplying services such as printing services, employment contract services, catering services, pandal or shamiana services, etc. In such cases, an electronic waybill may be generated by entering the details of the HSN code for the goods, along with the SAC (Service Accounting Code) for the respective services.