As a final year CA student juggling articleship and exam prep, I’m hitting a roadblock with a specific GST scenario and would really appreciate some guidance.
My articleship firm handles a lot of inter-state supply cases, particularly related to E-commerce operators (ECOs). I’m currently grappling with the applicability of TCS under Section 52 of the CGST Act, 2017, specifically when the supplier is unregistered but uses the ECO platform for inter-state sales within India.
ICAI’s study material touches on this, but I find the practical application confusing, especially concerning the reconciliation of GSTR-8 filed by the ECO and the supplier’s actual turnover. How does the department reconcile these figures considering the supplier is unregistered and, theoretically, not filing GSTR-1/3B? And what are the potential penalties for an ECO if they fail to collect TCS on such inter-state supplies believing the unregistered supplier isn’t liable, only to be challenged by the department later? Has anyone encountered a similar situation, and what’s the recommended approach to navigate this grey area?