GST Liability under Section 9(5) and Section 52 of CGST act

This query is : Resolved

MOHIT (Querist)
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08 August 2024
1- in case the service provider is voluntarily registered as accommodation provider and he is providing accommodation services other than thru ECO like MMT, AIRBNB although still his overall turnover is less than 20L threshold limit, in such case who will be liability to pay GST, ECO or accommodation service provider. Is this clarified or mentioned anywhere, that such voluntarily registered service provider will continue to pay tax on his turnover including thru ECO.

2- Further, how will ECO make out whether the service provider is actually liable for registration or is it that he has just taken voluntary registration, so as to apply exclusion from 9(5) laid out in Not. 17/2017, although language used in Notification 17/2017 states that... except where the person supplying such service through electronic commerce operator is liable for registration under sub-section (1) of section 22 of the said Central Goods and Services Tax Act.

3- is there a clarification issued by department later on this that in case service provider being an accommodation provider or housekeeping service provider is voluntarily registered also, then the ECO is not liable for GST and he can remit the GST collected to such registered service provider to discharge his overall GST liability.

Asha Kanta Sharma

Asha Kanta Sharma (Expert)
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12 August 2025 1. Who is liable to pay GST when the service provider is voluntarily registered and providing accommodation services outside ECO platforms but also through ECO?
Section 9(5) states that ECO is liable to pay GST on behalf of suppliers of specified services (including accommodation services) supplied through its platform.
However, Notification No. 17/2017-Central Tax (Rate) clarifies that ECO’s liability under Section 9(5) applies except where the person supplying the service through ECO is liable for registration under Section 22(1) (i.e., has crossed threshold limits or opted for voluntary registration).
Therefore, if an accommodation service provider is voluntarily registered, even if turnover is below threshold, the provider himself is liable to pay GST, including on sales through ECO.
The ECO is not liable to pay GST under Section 9(5) for services supplied by such voluntarily registered suppliers.
This means the service provider must pay GST on all supplies, including those through ECO platforms like MMT, Airbnb.
2. How does the ECO determine whether the supplier is liable for registration or just voluntarily registered, for exemption from Section 9(5)?
ECO should ideally verify the GST registration status of each supplier on its platform.
If the supplier has a valid GSTIN, ECO can check details like the date of registration and turnover through GSTN portal.
The Notification 17/2017 states ‘liable for registration’, which includes voluntary registration under Section 24.
Therefore, ECO cannot treat a voluntarily registered supplier as unregistered.
The language implies ECO must assume supplier is liable for registration if registered, regardless of turnover.
Hence, ECO’s GST liability under Section 9(5) is waived if supplier is registered (voluntarily or mandatorily).
3. Has the department issued clarification on ECO liability in cases of voluntary registration of accommodation or housekeeping providers?
Yes, several clarifications and circulars (e.g., Circular No. 105/24/19-GST dated 28th June 2019) reiterate that:
If the supplier is registered under GST (voluntary or otherwise), ECO is not liable to pay tax under Section 9(5) on their supplies.
ECO can collect GST from customers and remit it to the registered supplier.
The registered supplier will include such supplies in their GST returns and discharge the liability.
So, ECO’s liability under Section 9(5) applies only to unregistered suppliers of specified services on its platform.

What to do practically?
ECO should maintain records of suppliers’ GSTINs and validate registrations.
Accommodation service providers voluntarily registered should file returns and pay GST on all their supplies, including those through ECO platforms.
ECO should not deduct and pay GST on supplies of registered suppliers under Section 9(5).

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