Simplified Overview of GST Notification No. 34/2023: Exemptions for E-Commerce Suppliers

Simplified Explanation of Notification No. 34/2023-Central Tax

Purpose: This notification outlines the conditions under which persons supplying goods through an electronic commerce operator are exempt from obtaining GST registration, provided they meet specific criteria.

Key Points:

1. Exemption from Registration:
   • Persons who supply goods through an electronic commerce operator and have an aggregate turnover below the threshold limit for registration are exempt from obtaining GST registration, provided they meet certain conditions.
2. Conditions for Exemption:
   • No Inter-State Supplies: They must not make any supply of goods to other States or Union Territories.
   • Single State Operation: They must not supply goods through an electronic commerce operator in more than one State or Union Territory.
   • Permanent Account Number (PAN): They must have a valid PAN under the Income-tax Act.
   • Declaration on Common Portal: They need to declare their PAN, place of business, and the State/UT where they will make supplies on the common GST portal before starting their operations.
   • Enrolment Number: They must obtain an enrolment number on the common portal after their PAN is validated.
   • Single Enrolment Number per State/UT: They can only have one enrolment number per State/UT.
   • No Supply Without Enrolment: They cannot make any supply through the e-commerce operator without this enrolment number.
   • Cease of Enrolment Number: If they later obtain GST registration, their enrolment number will become invalid from the date of registration.

Example:

1. Scenario 1: Exempted Supplier
   • Business Name: Ltd.
   • Business Location: Karnataka
   • Turnover:₹8 lakhs in the previous year and current year.
   • Supplies: Only makes intra-State supplies (within Karnataka) through an e-commerce platform.
   • PAN: Valid PAN obtained.
   • Actions Taken:
     • Declared on GST Portal: Ltd. declares their PAN, business address, and State (Karnataka) on the GST portal.
     • Obtained Enrolment Number: After successful validation, they receive an enrolment number.
   • Outcome: Since GreenGrocersPvt. Ltd. meets all conditions, they are exempt from obtaining formal GST registration.
2. Scenario 2: Not Exempted Supplier
   • Business Name:EcoToys Ltd.
   • Business Location: Tamil Nadu
   • Turnover:₹12 lakhs in the previous year.
   • Supplies: Makes both intra-State and inter-State supplies.
   • PAN: Valid PAN obtained.
   • Actions Taken:
     • Declared on GST Portal:EcoToys Ltd. declares their PAN and business details on the GST portal.
     • Outcome:EcoToys Ltd. is not exempt because they make inter-State supplies. Therefore, they need to obtain GST registration.

Effective Date:

• The notification becomes effective from October 1, 2023.