Page 9 - Chapter 9 Registration

subject to fulfilment of specified conditions.
Ü However, threshold limit of ` 20 lakh (` 10 lakh in case of Special Category States of Mizoram, Tripura,

Manipur and Nagaland) is available to suppliers supplying services through such ECO.
Ü Suppliers supplying services specified under section 9(5) are also eligible for threshold limit for
exemption.

CCP 09.04.10.00
AB Pvt Ltd., Pune, Maharashtra, provides house-keeping services. The company supplies its
services exclusively through an e-commerce website owned and managed by Hi-Tech Indya Pvt Ltd.,

Pune. The turnover of AB Pvt Ltd. in the current financial year is ₹ 18 lakh.
Advise AB Pvt Ltd. as to whether it is required to obtain GST registration. Will your advice be any
different if AB Pvt Ltd. sells readymade garments exclusively through the e-commerce website
owned and managed by Hi-Tech Indya Pvt Ltd.? [Study Mat] [CA final MTP Aug 2018] [CA Final RTP

May 22]
Answer:-
Legal Provision:-
Ü As per section 22 of CGST Act, a supplier is liable to be registered in the State/ Union territory from

where he makes a taxable supply of goods and/or services, if his aggregate turnover in a financial year
exceeds the threshold limit.
Ü As per section 24(ix), person who supply goods or services or both, other than supplies specified under
section 9(5), through electronic commerce operator (ECO) who is required to collect tax at source u/s

52, is mandatorily required to obtain registration irrespective of its turnover.
Ü However, if ECO is liable to pay tax on behalf of the suppliers of services under section 9(5), the suppliers
of such services are entitled for threshold exemption.
Ü Further, Section 2(45) defines ECO as any person who owns, operates or manages digital or electronic

facility or platform for electronic commerce.
Ü Notification issued under section 9(5) specifies services of house-keeping, except where person
supplying such service through ECO is liable for registration under section 22(1), as one such service
where the ECO is liable to pay tax on behalf of suppliers.

Discussion & Conclusion:-
Ü Since Hi-Tech Indya Pvt Ltd. owns and manages a website for e commerce where both goods and
services are supplied, it will be classified as an ECO under section 2(45) and it is presumed that Hi-Tech

Indya is an ECO which is required to collect tax at source u/s 52.
Ü However, house-keeping services provided by AB Pvt Ltd., which is not liable for registration under section
22(1) as its turnover is less than ₹ 20 lakh through an ECO, is a service notified u/s 9(5).
Ü Thus, AB Pvt Ltd. will be entitled for threshold exemption for registration and will not be required to
obtain registration even though it supplies services through ECO.

Ü In second case, AB Pvt Ltd. sells readymade garments through ECO which is not notified under section
9(5) as only supplies of services are notified under that section & thus, AB Pvt Ltd. will have to
compulsorily obtain registration as per section 24(ix) irrespective of the threshold exemption.

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