GST on E-Commerce Industry

GST on E-Commerce Industry

Introduction: –

Article explains Place of Supply and Type of GST charged under GST under different scenarios, which includes Buyer, Seller & E-commerce in same state, Buyer, Seller & E-Commerce in different states, E-Commerce& Buyer in same state & supplier in other state, E-Commerce & Supplier in same state & Buyer in other state, Buyer& Supplier in same state & E-Commerce in other state, Buyer& Supplier in different state & E-Commerce in other state. Article further explains provisions related to TCS and TDS under GST by E-Commerce Operator.

Consideration Structure in Aggregator Business

♦ Place of Supply and Type of GST charged under GST under different scenario: –

1. Place of Supply of Services:

In Case of Supply of service made through E-Commerce operator following two Transaction take place:

• Service by E-Commerce operator to Supplier of service through E-Commerce.
• Supplier of service provide service to final consumer through E-Commerce.

In such case Place of supply will be as follow:

S. No	Service Provide	Registered / Unregistered under GST	Place of Supply
1	E-Commerce to Supplier of Service through E-Commerce	Registered	Place of such Registered Recipient
		Unregistered	If address available, then place of such recipient otherwise place of E- Commerce operator
2	Supplier of Service to Consumer through E- Commerce	Registered	Place of such Registered Recipient
		Unregistered	If address available, then place of such recipient otherwise place of E- Commerce operator

As discussed above place of Supply will be as follow in different scenario & type of GST:

Place of Supply will under different scenario & type of GST

1. Buyer, Seller & E-commerce in same state:

• Place of Supply will be that State & CGST & SGST to be charged

2. Buyer, Seller & E-Commerce in different states:

• Service from E-commerce to Supplier of Service – Place of supply will be place of supplier if registered or address of supplier available with E-Commerce otherwise place of E-commerce & IGST to be charged.
• Service from Supplier to Consumer through Ecomm. – Place of supply will be place of consumer if registered or address of consumer available with supplier otherwise place of Service Provider & IGST to be charged.

3. E-Commerce & Buyer in same state & supplier in other state:

• E-Commerce to Supplier of service – Place of supply will be place of supplier if registered or address of supplier available with E- Commerce otherwise place of E-commerce. IGST to be charged if supplier registered or address available otherwise CGST & SGST to be charged.
• Supplier to Consumer – Place of supply will be place of consumer if registered or address of consumer available with supplier otherwise place of supply of Service IGST to be charged if supplier registered or address available otherwise CGST & SGST to be charged.

4. E-Commerce& Supplier in same state & Buyer in other state:

• E-Commerce to Supplier of service– Place of supply will be place of supplier if registered or address of supplier available with E- Commerce otherwise place of E- commerce. CGST & SGST to be charged.
• Supplier to Consumer– Place of supply will be place of consumer if registered or address of consumer available with supplier otherwise place of supply of Service Provider. IGST to be charged if supplier registered or address available otherwise CGST & SGST to be charged.

5. Buyer& Supplier in same state & E-Commerce in other state-

• E-Commerce to Supplier of service – Same as per point 3
• Supplier to Consumer – Same as per point 1

6. Buyer& Supplier in different state & E-Commerce in other state-

• E-Commerce to Supplier of service – Same as per point 3
• Supplier to Consumer – Same as per point 3

♦ TCS under GST by E-Commerce Operator:

1. E-Commerce operator require to collect TCS under GST from Net Value of Taxable Supply made through it by the other supplier & E- Commerce operator collect the consideration on behalf of the
2. TCS rate is 1% when Inter-State Supply & 5% of CGST & 0.5% of SGST in case of Intra-State supply.
3. E-Commerce operator need to an obtain State-wise registration for TCS purpose in which it has obligation to collect
4. TCS should be CGST & SGST or IGST is based on GST charged by i.e. if supplier charged CGST & SGST on its supply TCS will be CGST & SGST or supplier charged IGST then TCS will be IGST.

♦ TDS under Income Tax Law by E-Commerce Operator:

1. E-Commerce operator shall deduct TDS also under section 194O under Income Tax Act, 1961 from the payment made to supplier (Individual or HUF) at the Rate 1% in case of supplies exceed Rs. 5,00,000/- with effect from 01st October 2020.

 – Contributed by Maheshwari