What Is the E-Way Bill and Why It Matters for Foreign Companies
The e-way bill (Electronic Way Bill) is a digital document required under India's Goods and Services Tax (GST) framework for tracking the movement of goods valued above INR 50,000. Introduced in April 2018, it functions as a real-time compliance mechanism that links goods in transit to their underlying tax invoices.
For foreign companies operating in India, whether through a subsidiary, branch office, or as an importer selling through Indian distributors, the e-way bill system directly impacts supply chain operations. Every interstate shipment above the threshold requires an e-way bill before the goods leave the warehouse. No bill means goods cannot legally move, and enforcement has real teeth: vehicles can be detained, goods seized, and penalties levied.
The system is managed through the official portal at ewaybillgst.gov.in, operated by the National Informatics Centre (NIC). The NIC also runs a second e-way bill portal (E-Way Bill 2) that mirrors the first, so that generation can continue if one portal is unavailable; the two synchronise in real time.
When Is an E-Way Bill Required?
Interstate Movement: Universal INR 50,000 Threshold
For interstate movement of goods (from one state to another), an e-way bill is mandatory for any consignment valued at more than INR 50,000. This threshold is uniform across all states. It applies to taxable goods; goods listed in the Annexure to Rule 138 and goods exempt under the notifications named in Rule 138(14) are outside the requirement, and the value of an exempt supply is excluded from the consignment value where an invoice covers both taxable and exempt items. See our GST registration guide for who must be registered in the first place.
Critical points for foreign companies:
- The INR 50,000 threshold applies to the consignment value per invoice, not per item. Multiple items on a single invoice that collectively exceed INR 50,000 require an e-way bill
- If multiple invoices are transported in a single vehicle and any individual consignment exceeds INR 50,000, each such consignment needs its own e-way bill
- The value includes GST. A shipment with a base value of INR 45,000 plus INR 8,100 IGST (18%) totals INR 53,100 and requires an e-way bill
Intrastate Movement: State-Specific Thresholds
For movement within a state, different states have set different thresholds. Some examples:
| State | Intrastate E-Way Bill Threshold |
|---|---|
| Delhi | INR 1,00,000 |
| Maharashtra | INR 1,00,000 |
| Karnataka | INR 50,000 |
| Tamil Nadu | INR 1,00,000 |
| Uttar Pradesh | INR 50,000 |
| Kerala | INR 50,000 |
These thresholds sit in notifications issued by each State, not in the central rules, and States change them. Check the current notification on the commercial tax department website of every State you ship within before relying on a figure. Some States also exempt intra-city movement altogether or apply the threshold only to a specified list of goods — Gujarat is the standard example, and its rule cannot be reduced to a single number.
Exemptions
Certain categories of goods and movements are exempt from e-way bill requirements:
- Goods transported by non-motorized conveyance (e.g., handcarts, bullock carts)
- Goods specified in the respective state or central notifications (e.g., fresh fruits, vegetables, milk)
- Transit cargo moving to or from a port, airport, or land customs station under customs bond
- Goods transported under the Ministry of Defence or customs supervision
- Precious metals and stones (Chapter 71) sit in the Annexure to Rule 138 and are outside the ordinary e-way bill requirement, but Rule 138F lets a State mandate an intra-State e-way bill for gold and precious stones — Kerala has done so
Who Must Generate the E-Way Bill?
Registered Supplier (Consignor)
The primary responsibility lies with the registered supplier. If your Indian subsidiary is shipping goods to a buyer in another state, your team generates the e-way bill before dispatch.
Registered Recipient (Consignee)
If the supplier is unregistered but the recipient holds a GSTIN, the recipient must generate the e-way bill. This is common when foreign companies purchase from small Indian suppliers who are not GST-registered.
Transporter
If neither the consignor nor the consignee generates the e-way bill, the transporter carrying the goods is responsible. Transporters can also update Part B (vehicle details) even if the consignor generated Part A.
Unregistered Persons
Unregistered persons or transporters can enroll on the e-way bill portal using their PAN and Aadhaar. This is relevant for small-scale suppliers in a foreign company's vendor network.
How to Generate an E-Way Bill: Step-by-Step
Step 1: Register on the Portal
If your Indian entity has a GSTIN, log in to ewaybillgst.gov.in using your GST credentials. From April 2025, two-factor authentication (2FA) is mandatory for all taxpayers, regardless of turnover. Set up your mobile number for OTP verification before generating bills.
Step 2: Fill Part A (Document Details)
Part A captures the transaction details:
- GSTIN of supplier and recipient: Enter both GSTINs. For unregistered parties, use "URP"
- Place of dispatch and delivery: Pin codes of origin and destination
- Document type: Tax invoice, bill of supply, delivery challan, or bill of entry
- Document number and date: Must match the underlying invoice exactly
- Value of goods: Total consignment value including GST
- HSN code: At least 4 digits, or 6 digits where aggregate turnover in the preceding financial year exceeded INR 5 crore
- Transport document number: Goods receipt (GR) number or lorry receipt (LR) number
After submitting Part A, the system generates a unique 12-digit E-Way Bill Number (EBN). However, the bill is not valid for movement until Part B is completed.
Step 3: Fill Part B (Vehicle Details)
Part B requires:
- Vehicle number: In the format AB12AB1234 (for road transport)
- Transport mode: Road, rail, air, or ship
- For non-road transport: Railway receipt number, airway bill number, or bill of lading number
The e-way bill becomes active only when Part B is filled. Goods must not begin movement before this step is complete.
Step 4: Print or Share the EBN
The generated e-way bill can be printed or shared electronically. The transporter carries the EBN (or a printout) during transit. Enforcement officers at state border checkpoints verify the EBN against the goods being transported.
Validity and Extensions
Standard Validity
The validity of an e-way bill is calculated based on the distance the goods travel:
| Distance | Validity Period |
|---|---|
| Up to 200 km | 1 day |
| Every additional 200 km | +1 day per 200 km |
For example, a shipment from Mumbai to Delhi (approximately 1,400 km) would have a validity of 7 days.
Extension Rules (2025-2026 Updates)
If goods cannot reach the destination within the validity period, the e-way bill can be extended. Key rules effective from January 2025:
- An extension can be made within eight hours before, or eight hours after, the expiry of the validity period — not only before expiry
- The maximum extension cap is 360 days from the original generation date
- E-way bills can only be generated for documents dated within 180 days. For instance, an invoice dated before July 2025 cannot be used to generate an e-way bill from January 2026 onward
Consolidated E-Way Bills
When a transporter carries goods from multiple consignors in a single vehicle, a consolidated e-way bill (Form GST EWB-02) can be generated. This links all individual EBNs under one consolidated number, simplifying checkpoint verification.
Practical scenario for foreign companies: Your 3PL logistics partner picks up goods from three of your warehouses in Maharashtra for delivery to customers across Gujarat. Each warehouse shipment has its own e-way bill (if above INR 50,000). The transporter generates a single consolidated e-way bill referencing all three individual EBNs.
Note: Consolidated e-way bills cannot be generated for certain categories including gold, jewelry, and precious stones.
Common Compliance Challenges for Foreign Companies
Challenge 1: Multi-State Supply Chain Complexity
Foreign manufacturing companies operating in India often source raw materials from multiple states, manufacture in one state, and ship finished goods to customers across the country. Each leg of this supply chain may require separate e-way bills. Integrating your ERP system with the e-way bill portal via APIs is strongly recommended for high-volume operations.
Challenge 2: Stock Transfers Between Own Warehouses
Moving goods between your own warehouses in different states requires an e-way bill if the value exceeds INR 50,000. Many foreign companies overlook this because there is no sale involved. However, the e-way bill requirement applies to all movements, not just sales transactions. Use a delivery challan as the document type for branch transfers.
Challenge 3: Returns and Rejections
When goods are returned by a customer or rejected at delivery, a fresh e-way bill must be generated for the return journey. The original e-way bill is not valid for return movement. This catches many foreign companies off guard, especially those with liberal return policies.
Challenge 4: Vehicle Breakdowns and Transshipment
If a vehicle breaks down mid-transit or goods are transshipped to another vehicle, Part B must be updated with the new vehicle number before movement resumes. Failure to update Part B can result in the goods being treated as moving without a valid e-way bill.
Penalties for Non-Compliance
The consequences of e-way bill violations are severe and can cripple supply chain operations:
| Violation | Penalty Under CGST Act |
|---|---|
| Moving goods without e-way bill | INR 10,000 or tax evaded, whichever is higher (Section 122) |
| Detention — owner of the goods comes forward | Penalty equal to 200% of the tax payable on the goods (section 129(1)(a)); for exempted goods, 2% of the value of the goods or INR 25,000, whichever is less |
| Detention — owner does not come forward | Penalty equal to 50% of the value of the goods or 200% of the tax payable, whichever is higher (section 129(1)(b)); for exempted goods, 5% of the value or INR 25,000, whichever is less |
| Procedure after detention | Notice within 7 days of detention, order within 7 days of the notice (section 129(3)) |
| Penalty not paid within 15 days of the order | Goods or conveyance may be sold or otherwise disposed of to recover the penalty (section 129(6)); the period can be shortened for perishable or hazardous goods. The conveyance is released on payment of the penalty or INR 1 lakh, whichever is less |
Beyond monetary penalties, vehicle detention creates operational disruption. A detained truck means delayed deliveries, dissatisfied customers, and potential breach of supply agreements. For foreign companies building credibility in the Indian market, these disruptions carry reputational costs.
2025-2026 System Updates
Two-Factor Authentication (April 2025)
From April 1, 2025, all taxpayers must use multi-factor authentication (MFA) to access the e-way bill and e-invoice portals. Ensure your India finance team has set up mobile-linked OTP verification.
Second E-Way Bill Portal (July 2025)
The NIC launched a parallel e-way bill portal (E-Way Bill2) from July 1, 2025, to eliminate single-point-of-failure risks. Both portals synchronize data in real time. Foreign companies can use either portal; the EBN generated on one is valid and verifiable on the other.
180-Day Document Rule (January 2025)
E-way bills cannot be generated against documents older than 180 days. This prevents misuse of old invoices for fraudulent goods movement. Ensure your invoicing and dispatch timelines are aligned to avoid situations where valid shipments are blocked because the invoice is too old.
E-Way Bills for Job Work and Inter-State Stock Transfers
Job Work Movement
Foreign manufacturing companies in India frequently send raw materials or semi-finished goods to job workers in other states. Under Rule 138(1), an e-way bill is mandatory for interstate job work movement regardless of consignment value. The principal (your subsidiary) generates the e-way bill using a delivery challan as the document type. When finished goods are returned from the job worker, a separate e-way bill must be generated for the return movement if the value exceeds INR 50,000.
Branch Transfers and Stock Movements
Moving inventory between your own warehouses across state lines requires an e-way bill even though no sale occurs. This is classified as a "supply" under GST because interstate branch transfers are treated as supplies between distinct persons (each state GSTIN is a distinct entity). Use a delivery challan and declare the market value of goods for the e-way bill. Many foreign companies with pan-India distribution networks overlook this requirement and face detention at state borders during routine checkpoint inspections.
Integration with Your ERP and Accounting Systems
For foreign companies with significant goods movement, manual e-way bill generation is impractical. The NIC provides APIs for bulk generation, which integrate with major ERP platforms:
- SAP: GST Add-on for SAP supports direct e-way bill generation from sales and delivery documents
- Oracle: India localization module includes e-way bill API integration
- Tally: Built-in e-way bill generation for Indian operations
- Custom ERPs: Use the NIC API documentation at docs.ewaybillgst.gov.in for custom integration
API-based generation eliminates manual errors, ensures automatic Part A/Part B filling, and provides audit trails for GST compliance reviews.
Key Takeaways
- E-way bills are mandatory for interstate goods movement above INR 50,000. The threshold includes GST in the consignment value calculation
- Both Part A (document details) and Part B (vehicle number) must be completed before goods begin movement. An e-way bill with only Part A is not valid
- Validity is 1 day per 200 km. Extensions can be made within eight hours before or after expiry and are capped at 360 days from original generation. The 180-day document rule prevents use of old invoices from January 2025
- Penalties include INR 10,000 or the tax evaded (whichever is higher), plus vehicle detention and goods seizure under Sections 122 and 129 of the CGST Act
- Foreign companies with multi-state operations should integrate their ERP systems with the e-way bill portal via APIs and ensure tax advisory support for interstate compliance
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Import Export Code (IEC) RegistrationFrequently Asked Questions
What is the e-way bill threshold for interstate goods movement in India?
For interstate movement, an e-way bill is mandatory for any consignment valued above INR 50,000. This threshold is uniform across all states and includes the GST amount in the value calculation. Multiple items on a single invoice that collectively exceed INR 50,000 require an e-way bill.
How long is an e-way bill valid in India?
The validity is 1 day for every 200 km or part thereof. For example, a shipment traveling 1,400 km would have a 7-day validity period. An extension can be made within eight hours before, or eight hours after, expiry of the validity period, up to a maximum of 360 days from the original generation date.
What happens if goods are transported without an e-way bill?
Under Section 122 of the CGST Act, the penalty is INR 10,000 or the tax sought to be evaded, whichever is higher. Under Section 129, the goods and the vehicle can be detained. Release requires a penalty of 200% of the tax payable where the owner of the goods comes forward, or 50% of the value of the goods or 200% of the tax payable, whichever is higher, where the owner does not come forward. If the penalty is not paid within 15 days of the order, the goods can be sold to recover it.
Can a foreign company generate e-way bills in India?
Yes, any entity with a valid GSTIN can generate e-way bills on the portal at ewaybillgst.gov.in. Foreign companies operating through subsidiaries or branch offices with GST registration can generate e-way bills. Unregistered persons can also enroll using their PAN and Aadhaar.
Is an e-way bill required for stock transfers between own warehouses?
Yes. Moving goods between your own warehouses in different states requires an e-way bill if the consignment value exceeds INR 50,000. Use a delivery challan as the document type. The e-way bill requirement applies to all goods movement, not just sales transactions.
Do goods returned by customers need a new e-way bill?
Yes. A fresh e-way bill must be generated for the return journey. The original e-way bill is not valid for return movement. The supplier or the returning party must generate a new e-way bill before the goods begin the return transit.
What is two-factor authentication for the e-way bill portal?
From April 1, 2025, all taxpayers must use multi-factor authentication (MFA) to access the e-way bill and e-invoice portals. This requires OTP verification via a registered mobile number in addition to the standard login credentials, regardless of the taxpayer's turnover.