Compulsory Registration under GST

[MANOHAR KALBURGI]

Dear Sir,

Assessee is a E-commerce operator ( he owns the website and operate it), where he provides services as facilitator (i.e customer place the order on Assessee and Assessee goes for purchase from Tutor and Assessee finally issues sale invoice to the customer on his own name after adding his margin).

Assessee has resident as well as NRI customers, for the purpose of sale made to NRI, sale value is received in INR (buyer itself converts and transfers to the Assessee) and does it qualify for export of service from India?

Please share your opinion whether section 24 of the CGST attracts for this transaction or not and also put lights in TCS implication on this if applicable.

Thank you in advance.

[ABHISHEK TRIPATHI]

1. Might consider changing business model, ECO should not be issuing invoices when they are merely a facilitator.

2. Hope other essentials for Export of Services are fulfilled, the only obstacle seems is the payment made. For that kindly refer to RBI Notification No. FEMA 14(R)/2016-RB dated 02.05.2016 and Circular 88/07/2019-GST dated 01.02.2019. Hope the payment is through freely convertible Vostro Account.

3. Seems well within the definition of Sec. 2 (45) of the CGST Act and within the ambit of Sec. 24 of the CGST Act, hence, registration is required.

4. ECO collecting consideration then comply with Sec. 52 of the CGST Act.

“Views are strictly academic in nature”

[MANOHAR KALBURGI]

Dear Abhishek,

How do we know whether money has come thru freely convertible VOSTRO account?

say suppose customer(indian orgin) pays thru his Indian bank account, can we treat this, that the money has come thru freely convertable VOSTRO account?

AI Summary

E-commerce operator must register under Section 24 of CGST Act; clarify export status for NRI sales in INR. An e-commerce operator, serving as a facilitator by purchasing from a tutor and issuing invoices with added margins, inquired about the applicability of compulsory registration under Section 24 of the CGST Act and the implications of TCS. The operator, dealing with both resident and NRI customers, questioned if sales to NRIs, paid in INR, qualify as exports. A respondent suggested reconsidering the business model, ensuring compliance with export service criteria, and checking if payments are through a freely convertible Vostro account. They confirmed the need for registration under the CGST Act and compliance with Section 52 regarding consideration collection.