E-way Bill – Absence of, when fatal and when mere procedural lapse – Intention to evade is the key

The Lucknow Bench of the GSTAT has delivered seemingly different decisions in two disputes – both involving transportation of goods without an e-way bill. In both the cases, the e-way was generated after the interception of goods.

In one of the cases, the Tribunal [Lucknow Automotives v. Assistant Commissioner – 2026 VIL 56 GSTAT LCK] set aside the penalty under Section 129(3) of the CGST Act, 2017, while observing that the transportation of goods without the e-way bill (which was generated after the interception), was a procedural lapse as the lapse occurred in the background of a genuine and fully identifiable transaction. It was noted that no independent material was brought on record demonstrating suppression, clandestine movement, undervaluation, fake documentation or any other positive circumstance indicating tax evasion. It was also noted that the transaction involved motorcycles which were highly identifiable goods.

However, in another dispute [Om Prakash v. Prop, Islam Trading Co. – 2026 VIL 58 GSTAT LCK] where though the goods were accompanied by a tax invoice and other documents, but were not accompanied by e-way bill, the Tribunal, in an ex parte order, set aside the order passed by the Appellate Authority and thus restored the demand of tax and imposition of penalty under Section 129(3). The Tribunal here observed that preventing generation of e-way bill leads to manipulation in books of accounts by the taxpayer at his convenience as the invoices are issued manually. According to the Tribunal, conducting a transaction without e-way bill establishes an intention to evade tax. Intention to evade was also noted by the Tribunal here based on other facts.