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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. And liability to pay GST is applicable on it for supply of passenger transportation services through its electronic platform and digital network.

GST Liability on Electronic Commerce Operator – The appellant engaged in business of taxi aggregation service wherein it provides the IT platform including Mobile App and website both to the customers and taxi drivers to integrate both of them on a single platform. For this facility, the appellant is collecting monthly usage charges from the taxi drivers and not collecting any amount from the customers. The Appellant submitted that invoicing is done by the taxi driver directly to customer using the platform of the appellant. The payment for a trip is collected by driver himself directly from the customer on the completion of the trip. The appellant sought an Advance Ruling as to whether the money paid by the customer directly to the driver of the cab for the service of the trip is liable to GST and whether the applicant is liable to pay GST on this amount. The Karnataka AAR on July 27, 2018 held 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. Aggrieved by the said Ruling, the appellant filed an appeal submitting that (i) the appellant 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; (ii) Taxi charges are directly paid by the customer to driver and the appellant shall provide a receipt of the total ride fee payable by customer at the end.
Held that--The Hon’ble Appellate Authority for Advance Ruling, Karnataka upheld the order NO-KAR ADRG 14/2018 dated 27/07/2018 passed by the AAR.—Opta Cabs Private Limited [2018] 7 TAXLOK.COM 005 (AAR-Karnataka)