An Electronic Commerce to mean the supply or receipt of merchandise as well as services, or transmitting of assets or information, over an electronic network, basically the internet, by utilizing any of the applications that rely on the internet, like yet not limited to e-mail, texting, shopping baskets, 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 products and additionally services is done by the operator.
E-Commerce operator is a person who, directly or indirectly, claims, operates or manages an electronic platform which is engaged in encouraging the supply of any merchandise and additionally services.
Likewise a person giving any information or some other services incidental to or in connection with such supply of merchandise and enterprises through electronic platform would be considered as an Operator. A person providing products/services all alone Account, however, would not be considered as an Operator.
For instance, Amazon and Flipkart are e-commerce Operators because they are encouraging genuine suppliers to supply products through their platform (prominently called Market place model or Fulfillment Model). However, Titan providing watches and jewels through its own website would not be considered as an e-commerce operator for the purposes of this arrangement. Essentially Amazon and Flipkart won’t be treated as e-commerce operators in relation to those supplies which they make all alone record (famously called inventory Model).
The e-commerce operator is required to collect (i.e. deduct) a sum out of the consideration paid or payable to the genuine supplier of products or services in respect of supplies of merchandise and/or services made through such operator. The sum so deducted/collected is called as Tax Collection at Source (TCS).
The sum collected by the operator is to be paid to the credit of appropriate government inside 10 days after the end of the month in which sum was so collected.
The operator is additionally required to file a Statement, electronically, containing details of all sums collected by him for the outward supplies made through his Portal, inside 10 days of the end of the calendar month to which such statement pertains. The said statement would contain the names of the real supplier(s), details of respective supplies made by them and the sum collected on their behalf.
The e-commerce operator required to outfit information to the Government relating to:
The operator is required to outfit the above information inside 5 working days from the date of service of notice asking such information. In case of failure to outfit such information, the penalty could be extended to Rs. 25,000/ –
TCS which is deposited by the operator into government record will be reflected in the money ledger of the real registered supplier (on whose record such collection has been made) on the premise of the statement filed by the operator. The same can be used at the time of discharge of tax risk in respect of the supplies by the genuine supplier.
The details of supplies and the sum collected amid 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 legitimate return filed 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 don’t coordinate with the corresponding details declared by the supplier the discrepancy should be communicated to both persons.
In case of confound, 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 legitimate return for the month in which discrepancy is communicated should be added to the yield obligation of the said supplier, for the calendar month succeeding the calendar month in which the discrepancy is communicated. The concerned supplier should, in whose yield tax obligation any sum has been added might be liable to pay the tax payable in respect of such supply alongside interest, at the rate specified on the sum so added from the date such tax was due till the date of its payment.