Clarification regarding Registration as E-Commerce Operator, Selling Own Goods through own web site


If Company Have its own Web portal and it selling goods through it and receiving payments online from its own website. The transaction is purely B2C.

Whether the company is E-commerce Operator as it is not providing a platform to other sellers?

Whether TCS provision is applicable as it is dealing only in B2C transactions?

Whether the Company is required to take Registration as E-commerce Operator?

What is the other compliance in GST if it is E-commerce Operator?

ANSWER Facts of the case:

The company is selling its own goods and receiving payments online through its own website. No other supplier is involved and the company is directly dealing with its clients resulting in a B2C transaction.

Law Applicable:

(i) As per 2(45) CGST the e-Commerce operator has been defined as follows; “any person who owns operates or manages digital or electronic facility or platform for electronic commerce”

(ii) Section 2(44) clarifies that electronic commerce is; “supply of goods or services or both, including digital products over digital or electronic network”

(iii) The responsibility of TCS is bestowed under section 52(1) on; “Every electronic commerce operator, not being an agent, shall collect an amount calculated at such rate not exceeding one per cent., of the net value of taxable supplies made through it by other suppliers where the consideration with respect to such supplies is to be collected by the operator.” Interpretation: Since the company supplies goods over digital networks, therefore, it does electronic commerce u/s 2(44).

The website is owned, operated, and managed by the company itself therefore it is covered by the definition u/s 2(45) and the company can be called e-Commerce operator. However, this does not mean that provisions of TCS are applicable on this company. Because section 52(1) prescribes those eCommerce operators who supply goods/services of other suppliers through its digital network.

The GST portal provides the following category of registrations being; (i) Taxpayer (ii) Tax Deductor (iii) Tax collector (E-Commerce) (iv) GST practitioner (v) Non-Resident Taxable Person (vi) United Nation Body (vii) Consulate or Embassy or Foreign Country (viii) Other Notified Person (ix) Non-Resident Online Service Provider This company is E-commerce operator by the definition given under section 2(45) but by operation of 52(1) it is not required to collect tax at source And therefore the company need not get registration under the category (iii) above, i.e. as an eCommerce operator. Registration must be under category (i) above, i.e. Taxpayer (normal).

If the website is selling goods of units located in different states (or different business verticals in the same state having different registration) then this will be a supply to a distinct person and thus registration as eCommerce operator will be needed.

Conclusion: The company is an E-Commerce operator by the virtue of definition but it need not collect tax at source and thus normal registration is needed. Registration as an E-Commerce operator will be needed if the supply of any other person (even a different distinct person being another branch office with different registration) is made through the website.

Author Bio

Qualification: CA in Practice
Company: Prince Basnal & Associates
Location: Agra, Uttar Pradesh, IN
Member Since: 23 Sep 2019 | Total Posts: 2

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October 2021