Special procedure for e-commerce operators: Notification no. 37/2023 – Central Tax dated August 04, 2023
In its 47th meeting, the GST Council had granted in-principle approval to allow unregistered suppliers to make intra-state supplies of goods through e-commerce operators. The objective was to empower small traders below the GST threshold limit and enable them to expand their business through e-commerce platforms.
Subsequently, the Central Board of Indirect Taxes and Customs (CBIC) issued Notification no. 37/2023 – Central Tax dated August 04, 2023, exercising the powers conferred by section 148 of the Central Goods and Services Tax Act, 2017 ("the CGST Act"). The notification specifies the special procedure that e-commerce operators must follow concerning the supply of goods made by unregistered persons.
Under the special procedure for e-commerce operators:
1. Unregistered persons are allowed to supply goods only after obtaining an enrolment number from the common portal.
2. E-commerce operators are prohibited from allowing inter-state supply of goods to unregistered persons.
3. E-commerce operators are not required to collect any Tax at Source (TCS) under Section 52 of the CGST Act in relation to the supply of goods made through unregistered persons.
4. E-commerce operators must electronically furnish all the details of supplies made through unregistered persons in the statement in FORM GSTR-8 on the common portal.
Furthermore, in cases where multiple e-commerce operators are involved in a single supply of goods through an electronic commerce platform, the term "the electronic commerce operator" refers to the operator who ultimately releases the payment to the unregistered supplier.
The effective date of the Notification is October 01, 2023. This measure is expected to benefit small traders and encourage their participation in the digital marketplace through e-commerce operators while streamlining the compliance process