GST on E-commerce Sellers:

Who Is Considered As E-Commerce Operator?

CGST act defines electronic commerce as – ” Electronic Commerce means the supply of goods or services or
both, including digital products over digital or electronic network.”

And defines electronic commerce operator as – “Electronic Commerce Operator means any person who owns,
operates or manages digital or electronic facility or platform for electronic commerce”

As per the above definition a person who is providing a platform for others to sell goods or services is
considered an e-commerce operator. Main examples of such operators selling goods are Amazon, Flipkart,
Snapdeal and operators selling services are Uber, Ola, Swiggy, Urban Clap.

A person selling goods or services through his personal website is NOT an e-commerce operator and therefore
below provisions do not apply to them. He has to charge GST and file returns as a normal dealer.

A businessman has registered on Justdial/Indiamart. A buyer calls such seller and makes a purchase. This
transaction is not done through Justdial/Indiamart and therefore cannot be considered as an e-commerce
operator transaction. The difference in this model is that the transaction is not taking via platform and also
Justdial/Indiamart is charging the business for listing or premium listing and not charging a specific percentage
of commission on sales.

E-Commerce Operators Registration Requirement

E-commerce operators have to register regardless of the turnover. Threshold limit of Rs. 20 lakh/10 lakh is not
applicable to e-commerce operators. They are not allowed to register under the composition scheme.

E-Commerce Sellers Registration Requirement

Persons who sell goods/services through an e-commerce operator are e-commerce sellers. They may be
selling goods/services through one or more e-commerce operators and may also sell through their
shops/office along with such platforms.

Such sellers can be classified into three categories for the purpose of applicability of GST provisions. They are

1) Selling goods – Such sellers are required to get registered under GST even if there turnover is less than the
threshold limit of Rs. 40/20/10 lakh. It means they are required to register before selling through the e-
commerce platform. All platforms like Amazon, Flipkart etc. required GSTIN at time of registration as a seller
on their platform.

2) Selling services other than mentioned in Section 9(5) – Such sellers are required to register and collect GST
only if there turnover is more than the threshold limit of 20/10 lakh. And if they are not registered then GST is
not liable on such transaction done through e-commerce operator. (Notification no. 65/2017 – CGST)

3) Selling services mentioned in Section 9(5) – Such sellers are not liable to register under GST even if their
turnover is more than the threshold limit.
A person who is selling goods/service through e-commerce operator cannot take registration under
composition scheme. He needs to get registered under regular scheme only.

What Is Section 9(5) And Services Covered Under Section 9(5) Of CGST Act?

Section 9(5) states that the government may specify the categories of services on which e-commerce operator
is liable to collect and pay GST as if e-commerce operator is providing the service. All the provision will apply
to such e-commerce operator and not the persons selling services through him.

The categories of services specified by the government under this section

 Services by way of transportation of passengers by a radio-taxi, motorcab, maxicab and motorcycle

for example – Ola, Uber. So, if a person is operating five cars through uber and has a turnover of Rs.
25 lakh then also he is not required to register.
 Services by way of providing accommodation in hotels, inns, guest houses, clubs, campsites or other
commercial places meant for residential or lodging purposes, except where the person supplying
such service through electronic commerce operator is liable for registration due to turnover beyond
threshold limit. For example – Goibibo, MakeMyTrip. Therefore if a hotel has a turnover of more
than Rs. 20/10 lakh then section 9(5) is not applicable and the hotel itself is liable to get
registered and pay GST.
 Services by way of housekeeping, such as plumbing, carpentering, except where the person
supplying such service through electronic commerce operator is liable for registration due to
turnover beyond the threshold limit.

Who Is Liable To Collect And Pay GST – E-Commerce Operator Or E-Commerce Sellers

1) Selling Goods – The e-commerce seller is liable for the collection of GST and pay to the government.

2) Selling services other than mentioned in Section 9(5) – The e-commerce seller is liable for collection of GST
and pay to the government.

3) Selling services mentioned in Section 9(5) – The e-commerce operator is liable to collect and pay GST to
the government.

Industry Wise Analysis And Comparison

Industry Examples of E- Seller Registration GST Collection

commerce Operator Requirement

Selling Goods Amazon, Flipkart, Seller required to Seller is required to

Snapdeal register. collect GST.

Hotel (Turnover of hotel Goibibo, OYO, Hotel is not required to E-commerce operator
less than 20/10 lakh) MakeMyTrip register. will collect GST.
Hotel (Turnover of the Goibibo, OYO, Hotel is required to Hotel is required to
hotel more than 20/10 MakeMyTrip register. collect GST.
lakh)

Cab Aggregator OLA, Uber Car owner required to Cab aggregator is

(Irrespective of turnover) register only if his required to collect GST
turnover other than even if the car owner is
through cab aggregators registered.
is more than 20/10 lakh.

House Keeping Services Urban Clap Service provider is not E-commerce operator
(Turnover of hotel less required to register. will collect GST.
than 20/10 lakh)

House Keeping Services Urban Clap Service provider is Service Provider is

(Turnover of hotel less required to register. required to collect GST.
than 20/10 lakh)

Other Service including Swiggy, Uban Eats, Service provider is Service provider is
Food aggregators* Urban Clap (Beautician) required to register if required to collect GST if
turnover is more than registered. If not
20/10 lakh. registered then GST not
applicable.