CA Intermediate · Taxation · Tax Deduction at Source and Collection of Tax at Source
Orchid Online Pvt Ltd operates an e-commerce platform and is registered under GST. During a month, registered supplier Bharat Handlooms makes taxable supplies through the platform with gross value Rs 9,00,000. Of this, Rs 60,000 was returned by customers (sales returns) in the same month, and Rs 1,40,000 relates to services where the platform is not the person liable to pay tax. Assuming the Rs 1,40,000 is a taxable supply through the platform on which the operator is not liable for tax, how much is the TCS base per section 52 as net value of taxable supplies?
The TCS base is Rs 8,40,000. Section 52 applies TCS on the net value of taxable supplies made through the operator, which is the aggregate taxable supplies less supplies returned. Rs 9,00,000 minus returns of Rs 60,000 gives Rs 8,40,000, and the other service amount is not deducted.
- ARs 8,40,000Correct
- BRs 9,00,000
- CRs 7,00,000
- DRs 7,80,000
Explanation
TCS under section 52 is on the net value of taxable supplies made through the operator, being aggregate value of taxable supplies by registered persons less the value of taxable supplies returned to them. Net = 9,00,000 - 60,000 = Rs 8,40,000. The Rs 1,40,000 is not deducted because it is still a taxable supply through the platform; only returns reduce the base.
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