Collection of tax at source by electronic commerce operator

The e-commerce operator to collect ‘amount’ while passing on amount to actual supplier – Every electronic commerce operator (hereinafter referred to in this section as the “operator”) shall, at the time of credit of any amount to the account of the supplier of goods and/or services or at the time of payment of any amount in cash or by any other mode, whichever is earlier, collect an amount, out of the amount payable or paid to the supplier, representing consideration towards the supply of goods and/or services made through it, calculated at such rate as may be notified – clause 43C(1) of GST Model Law, 2016.

Amount collected by e-commerce operator to be paid to Government – The amount collected as above shall be paid to the credit of the appropriate Government by the operator within ten days after the end of the month in which such collection is made, in the manner prescribed – clause 43C(3) of GST Model Law, 2016.

“Appropriate Government” means the Central Government in case of the IGST and the CGST, and the State Government in case of the SGST – clause 2(11) of GST Model Law, 2016.

E-commerce Operator to submit account to Government every month – Every operator shall, furnish a statement, electronically, of all amounts collected 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 – clause 43C(4)(a) of GST Model Law, 2016.

The statement shall contain 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.

Payment of amount is deemed to be tax on behalf of supplier of goods and services – Any amount collected in accordance with the provisions of this section and paid to the credit of the appropriate Government shall be deemed to be a payment of tax on behalf of the concerned supplier and the supplier shall claim credit, in his electronic cash ledger, of the tax collected and reflected in the statement of the operator – clause 43C(5) of GST Model Law, 2016.

‘Concerned supplier‘ shall mean the supplier of goods and/or services making supplies through the operator – explanation to clause 43C of GST Model Law, 2016.

Matching of statement of e-commerce operator and credit taken by supplier – The details of supplies and the amount collected shall be matched with the corresponding details of outward supplies furnished by the concerned supplier in his valid return for the same calendar month or any preceding calendar month – clause 43C(6) of GST Model Law, 2016.

Discrepancy between the details of operator and supplier – Where the details of outward supply, on which the tax has been collected, as declared by the operator do not match with the corresponding details declared by the supplier, the discrepancy shall be communicated to both persons.

If the discrepancy is not rectified, it 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 be liable to pay the tax payable in respect of such supply along with interest on the amount so added from the date such tax was due till the date of its payment – clause 43C(9) of GST Model Law, 2016.

‘Concerned supplier‘ shall mean the supplier of goods and/or services making supplies through the operator – explanation to clause 43C of GST Model Law, 2016.

E-commerce operator to furnish details

Any authority not below the rank of Joint Commissioner may, by notice, either before or during the course of any proceeding under this Act, require the operator to furnish such details relating to—

(a) supplies of goods and/or services effected through such operator during any period, or

(b) stock of goods held by the suppliers making supplies through such operator in the godowns or warehouses, by whatever name called, managed by such operators and declared as additional places of business by such suppliers as may be specified in the notice.

Every operator on whom a notice has been served shall furnish the required information within five working days of the date of service of such notice.

Penalty for not furnishing information – Any person who fails to furnish the information required by the notice shall, without prejudice to any action that is or may be taken under section 66, be liable to a penalty which may extend to rupees twenty-five thousand.