TMI Blog2018 (12) TMI 711X X X X Extracts X X X X X X X X Extracts X X X X ..... is payable by the consumer to the taxi driver. Therefore the appellant M/S. OPTA Cabs Pvt Ltd is an “electronic commerce operator” in terms of the definition given in Section 2(45) of the CGST Act. The argument of the Appellant that the taxi services are merely booked through it and not supplied through it is not a tenable argument. Further, the fact that the ecommerce operator is not receiving the amount from the customer is also not a valid consideration since the e-commerce operator is deemed to have supplied the service in terms of Section 9 (5) read with the notification. Ruling:- The services of transportation of passengers supplied through the Appellant’s electronic platform and digital network would be liable to tax at the hands of the Appellant. - KAR/AAAR/04/2018-19 - - - Dated:- 4-12-2018 - SHRI. A.K. JYOTISHI, AND SHRI. M.S. SRIKAR, MEMBER Represented by: Sri Chandrashekar Reddy, Managing Director PROCEEDINGS (Under Section 101 of the CGST Act, 2017 and the KGST Act, 2017) At the outset we would like to make it clear that the provisions of both CGST, Act 2017 and SGST, Act 2017 are in pari material and have the same provisions in like matter ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ling Authority has erred in holding that GST is leviable on the amounts billed by the appellant on behalf of the taxi operators for the services provided in the nature of transportation of passengers through it and is without consideration of the facts of the case and applicant s interpretation of law. ii. The Appellant viz. OPTA is providing mobile application to both drivers as well as customers to integrate both of them on a single platform, wherein services are provided by the driver to the customer without any intercession by the appellant viz. OPTA. iii. OPTA is an IT platform whereby services of information technology are provided to the drivers against a prepaid Monthly subscription. These charges are irrespective of the trips made or income earned by taxi drivers. OPTA has a policy of not charging any trip commission to taxi drivers. iv. Taxi charges are directly paid by the customer to driver either by way of Cash or E-payment or E-Wallets of driver. The appellant Viz. OPTA shall provide a receipt of the total ride fee payable by customer at the end. v. Section 9(5) of Central Goods and Service Tax Act 2017 states that: (5) The Government may, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ctly to taxi drivers; and OPTA does not charge any trip commission from taxi drivers. Thereby there is no flow of consideration on account of any particular trip undertaken by the said taxi driver. OPTA charges monthly rentals to taxi driver for usage of IT platform. The responsibility of OPTA is limited to providing a stable and fully functional IT platform to taxi drivers, and provision of taxi driver services is the sole responsibility of taxi drivers for which no part of income accrues to OPTA. OPTA does not ensure any work to any taxi driver, neither does it offer any incentives for completing particular value of transactions in limited time. viii. In view of the above appellant pleaded that the impugned order be set aside. Personal Hearing 6. The appellant was called for a personal hearing on 25/09/2018 and was represented by the Sri. Chandrashekar Reddy, Managing Director of M/s. OPTA Cabs Private Limited. 7. During the hearing the appellant reiterated the grounds of appeal and also made written submissions wherein they argued that the consideration paid by the customer for the service provided is received by the driver and is not received b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or means any person who owns, operates or manages digital or electronic facility or platform for electronic commerce. In the instant case the transportation of passenger service is provided by the taxi drivers by using a software application. Transportation of passengers is a taxable service liable to GST. The provision of this service by the taxi driver to the passenger is a supply within the scope of supply given in Section 7 of the CGST Act since the service is provided for a consideration. The Appellant on the other hand has developed a digital platform which aggregates the taxi drivers on one common platform. The service of transportation of passengers is supplied by the taxi drivers using the digital application developed by the Appellant. The Appellant manages the digital application which facilitates the supply of the service of transportation of passengers. 11. Further, the appellant owns and operates the IT platform for the supply of service of transportation of passengers over the digital network. Using this digital network facility the Appellant provides the taxi aggregation service wherein they connect both the customer as well as the taxi operator. The custome ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t step towards the supply of the service. Without the booking which is done on the digital application, no service can be provided by the taxi operator. The nature of e-commerce activity is such that the supply of goods or service or both happens through the electronic mode. In this case, booking for a taxi ride on the digital application is a part of the activity of the supply of the service of transportation of passengers. Without the booking no service can be supplied. Every supply begins with a request for the supply. The request can be in the form of a written request like a purchase order, a verbal request or a request made on the digital application which is in the nature of booking . Honouring such requests by the supplier of the goods or services, in return for a consideration, is the taxable event of supply . Therefore, booking for a service is also an integral part of the supply chain and hence there is no merit in the argument of the Appellant that the service has merely been booked on their platform and not supplied through it . We reiterate here that the supply of the service of transportation of passengers has been provided through the digital platform and by ..... X X X X Extracts X X X X X X X X Extracts X X X X
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