How to report online marketplaces operating without GST details?

Online marketplaces have become a major platform for buying and selling goods, but not all sellers and platforms operate in compliance with the law. One of the key requirements for businesses in India is Goods and Services Tax (GST) registration. If an online marketplace or seller operates without a valid GST registration, it can be seen as a violation of tax laws, leading to potential tax evasion. If you come across such a marketplace or seller, it’s important to report it to the relevant authorities to ensure compliance with tax regulations.

Steps to Report Online Marketplaces Operating Without GST Details

• Verify GST Compliance of the Seller
• Check for GST number: Genuine sellers and platforms in India should display their GSTIN (GST Identification Number) on their website or product listings.
• Verify GST Number: If a GSTIN is provided, you can verify its authenticity through the GST Portal at gst.gov.in. The portal has a tool for validating GST numbers.
• Check the Seller’s Terms and Conditions: Many online marketplaces have a Terms and Conditions or About Us section where they disclose their business credentials. Make sure to:
• Look for GST Details: See if the marketplace mentions its GST registration details and policies regarding GST for sellers.
• Assess the Seller: If the marketplace has no GST number listed or there are no GST details provided by individual sellers, it may indicate non-compliance.
• Contact the Seller or Marketplace
• Ask for GST Information: Politely ask the seller or platform to provide their GSTIN for verification, especially if you’re purchasing goods in large quantities or from a business.
• Request for Invoice: Ask for an invoice that includes their GST number. A legitimate seller should be able to provide one.
• Escalate the Issue: If the seller refuses to provide this information or does not respond, this could be a red flag.
• Report to the GST Authorities
• India – Goods and Services Tax (GST) Portal: You can file a complaint about businesses operating without GST details with the Central Board of Indirect Taxes and Customs (CBIC) via the GST Helpdesk or directly on the GST Portal.
• File a GST Complaint: Visit GST Complaints.
• Select File a Complaint option:
• Provide details of the marketplace or seller operating without a GSTIN:
• Attach relevant documentation: such as screenshots of the product listings or the seller's details that lack GST information.
• Direct Contact with the Department: You can also directly contact the GST authorities of your state. The state tax department will have a grievance redressal mechanism for reporting non-compliant sellers.
• Report to the Directorate of Revenue Intelligence (DRI)
• If the violation appears to be part of a larger pattern of tax evasion or if the goods being sold are subject to special taxes (e.g., luxury goods), you can report the issue to the Directorate of Revenue Intelligence (DRI). The DRI investigates large-scale tax evasion cases and can take action against businesses that are deliberately avoiding taxes.
• Report to Consumer Protection Agencies
• National Consumer Helpline (India): File a complaint with the National Consumer Helpline at consumerhelpline.gov.in. If the platform is violating tax laws, this complaint can be forwarded to the relevant authorities.
• E-commerce and Online Marketplace Regulations: If the platform is not adhering to transparency rules regarding tax, you can report it as a violation of e-commerce regulations.
• Report to the State Commercial Tax Department
• State Tax Reporting: You can file a complaint with the state commercial tax office if the online marketplace or seller is based in a particular state and is violating GST registration rules.
• Contact via State Helplines: Each state has a dedicated GST helpline for consumers and businesses to report violations or non-compliance.
• Report via Social Media Platforms or Forums
• Use Platform Reporting Features: Report the page, product listing, or account for non-compliance with business regulations. Most social media platforms have mechanisms for flagging such issues, which will prompt a review of the account.
• Share Your Experience: Sharing your concerns on social media or consumer forums can help alert other potential buyers to avoid such non-compliant platforms.
• Seek Legal Action (If Applicable)
• Consult a Lawyer: If you have paid for goods and services without receiving valid GST invoices, consider seeking legal advice to determine if you are entitled to a refund or compensation.
• Consumer Court: You can file a complaint in the consumer court for unfair trade practices or fraudulent activities if the seller refuses to provide you with the required GST details or invoices.

How to Protect Yourself from Dealing with Non-Compliant Sellers

• Always Check for GST Registration
• Verify GSTIN: Ask the seller for a valid GSTIN, and verify it using the official GST portal.
• Request Proper Invoices: Ensure that you receive an invoice with the seller’s GST number, especially for high-value transactions.
• Research the Marketplace or Seller
• Look for feedback and reviews: from other customers. Reliable platforms usually have positive reviews and offer transparent business practices, including GST registration.
• Check if the seller is part of a well-known and established marketplace: (e.g., Amazon, Flipkart) where compliance checks are typically in place.
• Avoid Unregistered Sellers
• Non-compliant Sellers: Avoid doing business with sellers who cannot provide clear tax information.
• Risk of Fraud: Sellers operating without GST registration may also be engaging in fraudulent or illegal activities, such as selling counterfeit goods or evading taxes.

Example

Scenario: A consumer buys electronic gadgets from an online platform that promotes itself as a major e-commerce marketplace. However, when the consumer asks for a GST invoice, the seller refuses to provide it, and there is no GST number displayed anywhere on the website.

Steps to Take:

• Verify the GST Information: The consumer asks the seller again for the GST details and attempts to verify the seller’s GSTIN through the official portal but finds no valid registration.
• Report to GST Authorities: The consumer files a complaint on the GST portal to report the seller for operating without GST registration.
• Contact Consumer Protection: The consumer files a complaint with the National Consumer Helpline regarding the issue of fraudulent business practices and failure to provide GST information.
• Warn Other Consumers: The consumer shares their experience on consumer forums and social media to warn others about the unregistered seller.

By following these steps, consumers can help report and take action against online marketplaces that operate without GST registration, helping to enforce tax compliance and protect others from potential fraud or non-compliant business practices.