The Central Board of Direct Taxes (CBDT) on December 28, 2024, issued the Guidelines under sub-section (4) of section 194-O of the Income-tax Act 1961 which “mandates that the tax is required to be deducted where the sale of goods or provision of services or both of an e-commerce participant (buyer or seller) is facilitated by an e-commerce operator (ECO) through its digital facility or platform”.
The following has been stated namely: -
• The following has been addressed in the guidelines: -
1. Who should deduct tax at source where there are multiple e-commerce operators (ECO) involved in a transaction
2. E-commerce operators may be levying convenience fees or charging commissions for each transaction and sellers might levy logistics & delivery fees for the transaction. Payments may also be made to the platform or network (e.g. ONDC) provider for facilitating the transaction. Would these form part of the “gross amount” for the purposes of TDS under section 194-O of the Act.
3. How will GST, various state levies, and taxes other than GST such as VAT/Sales tax/Excise duty/CST be treated when calculating the gross amount of sales of goods or provision of services as per the provisions of section 194-O of the act.
4. How will adjustment for purchase-returns take place
[Notification No. 370142/43/2023-TPL]
