States demand e-permit for goods transported across borders

GST will be applicable across the country come July 1st, but looks like the negotiations between the Centre and the states on the finer points of this new tax bill have reached the first major contention point – the need for transport e-  permit across state borders.One of the biggest increments of GST was the free-flow of trade that it promised and a moving away from the old ‘permit raj’. But the states’ insistence on keeping a tab on the goods being supplied across their borders has left the Centre no choice other than to yield to their demands and accept this archaic system. While the e-permits that will be used now seem to be a step above the old transports bitlys that were being used earlier, they still follow the same rule. Reportedly, the Centre had its own apprehensions bringing in the e-permits as they go against the very spirit of the unified GST, but it finally had to cave in.

Why an e-permit is not a necessity

Under the model GST law, it is clearly stated that the “central or a state government may require the person in charge of a conveyance carrying any consignment of goods of value exceeding. 50,000 to carry with him such documents as may be prescribed in this behalf, where any vehicle referred to in sub-section (1) is intercepted by the proper officer at any place, he may require the person in charge of the said vehicle to produce such documents for verification and the said person shall be liable to produce the documents.”

Thus, it is not really necessary for transporters to carry an extra permit on their person. Many would have thought that GST would kill the long line of trucks waiting at check posts to be cleared by authorities, but will this clause being added in the law, it doesn’t seem likely anymore.