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Taxation Delhi Ministry of Finance Delhi Goods and Services Tax Act, 2017

Clarification on TCS liability under Sec 52 of the DGST Act, 2017 in case of multiple E-commerce Operators in one transaction

18-Aug-2023 | F.3 (501)/GST/Policy/2023/856-865

Government of Delhi has issued a Notification providing clarification on Tax Collection at Source (TCS) liability under Section 52 of the DGST Act, 2017 in cases involving multiple E-commerce Operators (ECOs) in a single transaction. This clarification is effective from August 18, 2023.

Clarifications provided:

Issue 1:

In situations where multiple ECOs are involved in a single transaction through an ECO platform, and the supplier-side ECO is not the actual supplier in the transaction, the liability for compliances under Section 52, including TCS collection, falls on the supplier-side ECO who ultimately releases the payment to the supplier. In this case, the buyer-side ECO is not required to collect TCS or carry out other compliances under Section 52 of the DGST Act for this specific supply.

Issue 2:

In situations where multiple ECOs are involved in a single transaction, and the supplier-side ECO is also the actual supplier, the liability for compliances under Section 52, including TCS collection, lies with the buyer-side ECO. The buyer-side ECO is responsible for collecting TCS when making payment to the supplier for the specific supply facilitated through it. This scenario occurs when the buyer-side ECO collects payment from the buyer, deducts its fees, and then remits the balance to the supplier (who is also an ECO as per the definition in Section 2(45) of the DGST Act).

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