E-commerce is a
relatively new concept in India and as such various aspects related
to it are still developing. One such aspect is legal issues
associated with e-commerce in India especially with conflict
of laws issues. E-commerce
laws in India are still maturing as we have basic level
legal framework regarding e-commerce in India as incorporated in the
Information Technology Act, 2000 (IT Act 2000). However, there is no
clarity regarding legal or illegal usage of e-commerce platforms in
India as on date.
Recently, the Indian
government clarified about the Foreign
Direct Investment (FDI) in E-Commerce Sector of India. But FDI and taxation related violations are still happening
in India as Indian government has not taken a firm stand in this
regard. A software
for calculating e-commerce exports was also developed by
Indian government. Nevertheless, legal
violations by big e-commerce platforms of India still
continues especially for online
pharmacies, telemedicine,
online
gambling, e-health,
m-health,
internet of things (IoT), etc. E-commerce disputes resolution is
another area that requires urgent attention of Indian government.
Technology driven initiatives like e-courts
and online
dispute resolution (ODR) must be encouraged by Indian
government for resolution
of e-commerce disputes in India.
Now it has been reported
that Amazon and 50 of its sellers are facing investigations for
allegedly falsely claiming Central Value Added Tax (Cenvat) credit
and evading tax of about Rs 118 crore. Aggregators such as Amazon pay
service tax to the seller. Some sellers had not deposited the service
tax with the government even after claiming it from the e-commerce
giant. The Directorate General of Central Excise Intelligence (DGCEI)
is investigating the matter. Traders are alleged to have misused the
Cenvat scheme, which allows a manufacturer or service provider a
relief from the taxes paid on inputs to manufacturing of final
products or services. DGCEI had detected that bogus invoices of
declared goods were issued to merchants through dummy firms.
Verifications revealed that the firms said to be providing the goods
were non-existent.
Officers of the DGCEI
have conducted search operations at Amazon's business premises across
the country and at its headquarters in Bengaluru, in January. "So
far, the total tax evasion we have been able to establish is to the
tune of Rs 118 crore, which could increase. We will soon issue show
cause notices to respective sellers," a senior officer said. "We
have recorded the statement of Amazon executives and are assessing
the details provided by them," he added. Amazon India has
confirmed that the DGCEI had raised some questions around their
promotion programme. Amazon has cooperated with the authorities to
the fullest extent and provided them with all the information that
they needed. The DGCEI is also probing if Amazon had any involvement
in the merchants claiming Cenvat credit.
