Summary
- A critical question arises under GST: Are businesses liable for penalties when transferring goods internally without an e-way bill?
- Rule 138 of the CGST Rules, 2017 mandates an e-way bill for all goods movement, but internal transfers lack a sale, complicating compliance.
- The Gujarat High Court's ruling in Marcowagon Retail (P.) Ltd. v. Union of India highlights that without a taxable supply, no penalty can be levied under Section 129(1)(a).
- While best practices suggest generating e-way bills for internal movements, the legal framework presents significant challenges in imposing penalties.
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