Supply chain intermediaries not ready for transparency, accountability

With most of the goods transport associations not having their members registered under the Carriage by Road Act, 2007, and Carriage by Road Rules, 2011, till date, the entire purpose of bringing transparency and accountability into the system through the implementation of the goods and services tax (GST) is taking a beating.

“We have more than 300 members in the association and most of them are not registered under the Carriage by Road Act till date,” said N V Prakash Raju, member of the executive council at Chennai Goods Transport Association. “We understand that the state transport authority (which carries out the registration) is short-staffed and, hence, registrations are not taking place at the expected pace,” he added.

The Chennai Goods Transport Association is not the only transport association in this situation. The members of the Delhi Goods Transport Association are in the same boat.

“There is a lot of confusion about registration under the Act, and as a result, the majority of our 700-800 members remain unregistered,” said Parmeet Singh Goldie, general secretary of the Delhi Goods Transport Association. “No one has still understood the GST norms properly, but fortunately we are exempted so we need not get the GST identification number (GSTIN). There is pressure for registration under the Act, we (members) will register eventually,” he explained.

Under the GST, the government will bring in an e-way bill system, under which movement of goods worth more than ~50,000 by a registered entity will require prior online registration of the consignment on the GST portal and securing an “e-way” bill.

In case the e-way bill is not generated by the registered entity, and the goods are handed over to a transporter, the registered entity is required to furnish the information relating to transporter on the common portal and the e-way bill shall be generated by the transporter.

The transporter carrying the goods will be required to carry the e-way bill along with invoice/bill of supply/delivery challan. Since the transaction will eventually be recorded under the GST system, lack of registration under the Act by transport intermediaries could create problems.

Registration is mandatory for all intermediaries of the supply chain, who are also required to reveal their transactions to bring transparency to the system. Supply chain intermediaries typically include goods transport agents, freight aggregators, logistics firms, including e- truck entities linking supplier with the consignment receiver.