E-way bill rules for shops and distributors

When you need an e-way bill

You need an e-way bill when you move goods worth more than ₹50,000 in one consignment, whether the movement is a sale, a return, a stock transfer or goods sent for job work. It is generated on the e-way bill portal or through your billing software before the goods leave.

The rules are in Rule 138 of the CGST Rules. They are as of October 2026. States can set their own limits and exemptions for movement within the state, so check your state's rule too. Where a case depends on your business, check with your CA.

How the ₹50,000 value is counted

The consignment value is the value on the invoice, bill of supply or delivery challan, worked out under section 15 of the CGST Act. These points decide whether you cross ₹50,000.

• Tax is included. CGST, SGST or IGST and cess are part of the value.
• Exempt goods on a mixed invoice are left out. If one invoice has both taxable and exempt goods, the value of the exempt goods is not counted.
• The test is per consignment, not per vehicle. A tempo carrying five invoices of ₹30,000 each to five shops does not need an e-way bill for any of them under the central rule. Some states look at this differently for movement within the state, so check yours.
• A delivery challan counts like an invoice. If you move a ₹1.8 lakh van load under one challan, the challan value is ₹1.8 lakh.

You can also generate an e-way bill below ₹50,000 if you want one. Some buyers ask for it.

Movements that need one whatever the value

• Goods sent by a principal in one state to a job worker in another state.
• Handicraft goods moved inter-state by a person exempt from registration.

Part A and Part B

The e-way bill form (GST EWB-01) has two parts.

If you hand the goods to a transporter, you fill Part A and give the transporter ID. The transporter fills Part B. If neither the supplier nor the recipient generates it, the transporter must, when the value is above ₹50,000.

The 50 km relief on Part B

Part B need not be filled when goods move up to 50 km within the same state from your place of business to a transporter's place of business, for onward transport. In the same way, the vehicle details need not be updated for a last leg of up to 50 km within the state from the transporter's place to the buyer. Part A is still needed.

Validity by distance

Validity starts when the e-way bill is first generated with Part B. It runs as follows under Rule 138(10).

A "day" ends at midnight of the day after generation. An e-way bill made at 3 pm on Monday for a 150 km trip is valid until midnight on Tuesday. A 450 km trip gets 3 days.

If goods cannot reach in time, because of a breakdown for example, the validity can be extended around the time of expiry, within eight hours of it. From 1 January 2025, the total extension is capped at 360 days from the original generation date.

Exemptions that help shops and distributors

Rule 138(14) lists cases where no e-way bill is needed. The ones most useful to traders are:

• Non-motorised conveyance. A handcart or cycle rickshaw does not need an e-way bill.
• Exempt goods. Goods in the schedule of Notification 2/2017-Central Tax (Rate), such as fresh vegetables, fresh fruit and fresh milk, other than de-oiled cake. Goods exempted under Notifications 7/2017 and 26/2017 (Rate) are also covered.
• Annexure goods. These include household LPG, PDS kerosene, jewellery and precious metals, currency, and used personal and household effects.
• Petroleum and liquor. Alcoholic liquor, crude, high speed diesel, petrol, natural gas and ATF.
• Weighbridge trips. Movement to and from a weighbridge up to 20 km, under a delivery challan.
• Empty cargo containers and empty LPG cylinders moved other than for supply.
• Areas notified by the state. Some states exempt movement within a city or a notified area.

State limits for intra-state movement

Several states use a higher limit than ₹50,000, or exempt some goods or areas, for movement within the state. These rules change from time to time. Before you rely on any figure, check the current notification of your state's commercial tax department, or the intra-state rules section of the e-way bill portal at ewaybillgst.gov.in.

Van sales: how distributors handle it

A van that leaves the godown with stock and sells to shops on a route does not know the buyers or quantities in advance. CBIC's Circular 10/10/2017-GST deals with goods taken out for supply on approval in a similar situation. The approach it lays down is used by many distributors:

1. Load the van under a delivery challan for the full stock (Rule 55).
2. Generate an e-way bill on that challan if its value is above ₹50,000, or above your state's limit for intra-state movement.
3. Carry the invoice book or a billing app and issue a tax invoice at each delivery.
4. At the end of the day, record the stock that came back, so challan quantity equals invoices plus returns.

If the van crosses into another state, the sales there are inter-state and attract IGST. Because state rules on van movement differ, confirm your process with your CA. Our page on van sales software shows how loads, sales and returns are kept in one place.

Generating, cancelling and rejecting

• Old documents: from 1 January 2025, an e-way bill cannot be generated on a document dated more than 180 days earlier.
• Cancelling: an e-way bill can be cancelled within 24 hours of generation, if the goods were not moved or not moved as declared. It cannot be cancelled after an officer has verified it in transit.
• Rejecting: the other party can accept or reject it within 72 hours, or before delivery if earlier. If they do nothing, it counts as accepted.
• Changing vehicles: update Part B before the goods move to a new vehicle.
• Several bills, one truck: the transporter can make a consolidated e-way bill listing each one.
• E-invoice users: if you are under e-invoicing, the e-way bill can be generated with the IRN when you give the transport details. See e-invoicing under GST.

Logins to the e-way bill portal need a password and an OTP. This multi-factor authentication became compulsory for all users from 1 April 2025.

Penalties in brief

• Moving taxable goods without a valid e-way bill can lead to detention of the goods and vehicle under section 129, with a penalty of up to 200% of the tax payable.
• Section 122 also has a penalty for transporting goods without the required documents.
• For small slips such as a spelling error, a wrong PIN with the correct address, or one wrong digit in a document number, CBIC's Circular 64/38/2018-GST says a small penalty under section 125 is the usual course, not detention.

The amounts depend on the facts. If goods are held, speak to your CA quickly.

Common mistakes

• Leaving out GST when checking the ₹50,000 limit.
• Using the wrong PIN code for the delivery place, which gives the wrong distance and validity.
• Starting a trip with Part B empty when the 50 km relief does not apply.
• Letting the e-way bill expire after a breakdown instead of extending it in time.
• Different values on the invoice and the e-way bill.
• Van loads with no challan, or challans that do not match invoices plus returns.

Doing this in Cartix Prime

E-way bills and e-invoices are on the Gold plan. Cartix Prime makes the portal's bulk-generation file from your bills, delivery challans and branch transfers; you upload it on the e-way bill portal and type the 12-digit numbers back, so they print on the documents. A bill the portal would refuse is left out of the file with the reason. Gold also has van sale and salesmen, with routes, van stock load and unload, and collections. Delivery challans are available from Silver. Bills carry HSN and GST by rate. See van sales software and GST billing software.