Q 1. What is e-commerce?
Ans. Section 43B(d) of the MGL defines an Electronic Commerce to mean the supply or receipt of
goods and/ or services, or transmitting of funds or data, over an electronic
network, primarily the internet, by using any of the applications that rely on
the internet, like but not limited to e-mail, instant messaging, shopping
carts, web services, universal description Discovery and integration (UDDI),
File Transfer Protocol (FTP) and Electronic Data Interchange (EDI) whether or
not the payment is conducted online and whether or not the ultimate delivery of
the goods and/or services is done by the operator.
Q 2. Who is an e-commerce operator?
Ans. Section 43B(e) of the MGL defines an Electronic Commerce
Operator (Operator) as every person who, directly or indirectly, owns, operates
or manages an electronic platform which is engaged in facilitating the supply
of any goods and/or services. Also a person providing any information or any
other services incidental to or in connection with such supply of goods and
services through electronic platform would be considered as an Operator. A
person supplying goods/services on his own account, however, would not be
considered as an Operator. For instance, Amazon and Flipkart are e-commerce Operators
because they are facilitating actual suppliers to supply goods through their
platform popularly called Market place model
or Fulfillment Model). However, Titan supplying watches and jewels through its
own website would not be considered as an e-commerce operator for the purposes
of this provision. Similarly Amazon and Flipkart will not be treated as
e-commerce operators in relation to those supplies which they make on their own
account (popularly called inventory Model).
Q 3. Is it mandatory for e-commerce operator to obtain
registration?
Ans. Yes. Section 19 r/w Schedule-III of the MGL, provides that
the threshold exemption is not available to e-commerce operators and they would
be liable to be registered irrespective of the value of supply made by them.
Q 4. Whether a supplier of goods/services supplying through
e-commerce operator would be entitled to threshold exemption?
Ans. No. Section 19 r/w Schedule-III of the MGL, provides
that the threshold exemption is not available to such suppliers and they would
be liable to be registered irrespective of the value of supply made by them.
Q 5. Who is an aggregator?
Ans. Section 43B(a) of the MGL defines aggregator to mean a
person, who owns and manages an electronic platform, and by means of the
application and communication device, enables a potential customer to connect
with the persons providing service of a particular kind under the brand name or
trade name of the said aggregator. For instance, Ola cabs would be an
aggregator.
Q 6. Is an aggregator required to be registered under GST?
Ans. Yes. Section 19 r/w Schedule-III of the MGL, provides that
the threshold exemption is not available to aggregators and they would be
liable to be registered irrespective of the value of supply made by them.
Q 7. What is Tax Collection at Source (TCS)?
Ans. In terms of Section 43C(1) of the MGL, the e-commerce operator
is required to collect (i.e. deduct) an amount out of the consideration paid or
payable to the actual supplier of goods or services in respect of supplies of
goods and / or services made through such operator. The amount so deducted/collected
is called as Tax Collection at Source (TCS).
Q 8. At what time/intervals should the e-commerce operator
make such deductions?
Ans. The timings for such collection/deduction are earlier of
the two events:
(i) the time of credit of any amount to the account of the
actual supplier of goods and / or services;
(ii) the time of payment of any amount in cash or by any
other mode to such supplier.
Q 9. What is the time within which such TCS is to be remitted
by the e-commerce operator to Government account? Is the operator required to
file any returns for this purpose?
Ans. In terms of Section 43C(3) of the MGL, the amount collected
by the operator is to be paid to the credit of appropriate government within 10
days after the end of the month in which amount was so collected. Further, in
terms of Section 43C(4) of the MGL, the operator is required to file a
Statement, electronically, containing details of all amounts collected by him
for the outward supplies made through his Portal, within 10 days of the end of
the calendar month to which such statement pertains. The said statement would
contain the names of the actual supplier(s), details of respective supplies
made by them and the amount collected on their behalf. The Form and Manner of
the said Statement would be prescribed in the GST Rules.
Q 10. How can actual suppliers claim credit of this TCS?
Ans. Such TCS which is deposited by the operator into government
account will be reflected in the cash ledger of the actual registered supplier
(on whose account such collection has been made) on the basis of the statement filed
by the operator. The same can be used at the time of discharge of tax liability
in respect of the supplies by the actual supplier.
Q 11. Is the e-commerce operator required to furnish information
to the Government?
Ans. Yes. In terms of section 43C(10), an officer not below the
rank of Joint Commissioner may require the operator to furnish details relating
to:
(i) supplies of goods / services effected through the operator
during any period;
(ii) stock of goods held by actual supplier making supplies
through such operator in the godowns or warehouses belonging to the operator
and registered as additional place of business by the actual supplier. The
operator is required to furnish the above information within 5 working days
from the date of service of notice asking such information. In case of failure
to furnish such information, the penalty could be extended to Rs. 25,000/- .
Q 12. Is the e-commerce operator required to submit any
statement? What are the details that are required to be submitted in the
statement?
Ans. Yes, in terms of Section 43C (4), every operator is required
to furnish a statement, electronically, of all amounts collected as TCS towards
outward supplies of goods and/or services effected through it, during a
calendar month within ten days after the end of such calendar month. The
statement shall contain, inter alia, the details of the amount collected on behalf
of each supplier in respect of all supplies of goods and/ or services effected
through the operator and the details of such supplies during the said calendar
month.
Q 13. What is the concept of matching in e-commerce provisions
and how it is going to work?
Ans. As per section 43C (6), the details of supplies and the
amount collected during a calendar month, and furnished by every operator in
his statement will be matched with the corresponding details of outward
supplies furnished by the concerned supplier in his valid return filed under
section 27 for the same calendar month or any preceding calendar month. Where
the details of outward supply, on which the tax has been collected, as declared
by the operator in his statement do not match with the corresponding details declared by the
supplier the discrepancy shall be communicated to both persons.
Q 14. What will happen if the details remain mismatched?
Ans. As per section 43C (8), the value of a supply relating to
any payment in respect of which any discrepancy is communicated and which is not
rectified by the supplier in his valid return for the month in which discrepancy
is communicated shall be added to the output liability of the said supplier,
for the calendar month succeeding the calendar month in which the discrepancy
is communicated. The concerned supplier shall, in whose output tax liability any
amount has been added shall be liable to pay the tax payable in respect of such
supply along with interest, at the rate specified under sub-section (1) of
section 36 on the amount so added from the date such tax was due till the date
of its payment.