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CA Final · Indirect Tax Laws · Electronic Commerce Transactions

Under section 9(5) of the CGST Act, 2017, the Government has notified a category of services whose intra-State supplies through an e-commerce operator attract tax payable by the operator. Which statement is correct about the legal position of the operator?

The operator is treated as if he is the supplier liable to pay the tax on the notified services. Section 9(5) applies all the provisions of the Act to him in that capacity. It is not a reverse charge arrangement, and it does not depend on the supplier's registration or the operator's commission.

  1. AAll provisions of the Act apply to the operator as if he is the supplier liable for paying tax in relation to such servicesCorrect
  2. BThe operator pays tax as a recipient under reverse charge, and the actual supplier remains liable for the tax
  3. CThe operator pays tax only if the actual supplier is unregistered
  4. DThe operator pays tax only on the commission earned for facilitating the supply

Explanation

Section 9(5) states that all provisions of the Act apply to the operator as if he is the supplier liable for paying tax for the notified services. It is not a reverse charge under section 9(3) or 9(4), and nothing links it to the supplier's registration status or to commission only.

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