Introduction
Online Information and Database Access or Retrieval services, hereinafter referred to as “OIDAR services”, have been taxed in India when supplied by overseas providers since 01.12.2026. The tax was first levied as service tax under the Finance Act, 1994 and the Service Tax Rules, 1994. From 01.07.2017, it has been levied as integrated tax under the Integrated Goods and Services Tax Act, 2017, hereinafter referred to as the “IGST Act”, and the Central Goods and Services Tax Rules, 2017, hereinafter referred to as the “CGST Rules”.
Both regimes share one idea. An overseas supplier who sells to Indian consumers must register in India through a special, simplified route and pay the tax itself. Under GST, this route is called the Simplified Registration Scheme, hereinafter referred to as the “SRS”. This article attempts to trace how the service tax regime was built, how GST inherited it, and how the SRS operates today.
The Position Before 01.12.2016
Before December 2016, an OIDAR service supplied from outside India was not subject to service tax. The Place of Provision of Services Rules treated the location of the service provider as the place of provision for these services. A provider sitting abroad therefore supplied the service outside the taxable territory. An OIDAR service received from a foreign provider in India did not attract service tax.
The result was a clear gap. A foreign streaming platform, software vendor or cloud provider could serve Indian customers without any Indian tax on the supply.
The Service Tax Amendments of 2016
The Government closed this gap through a set of notifications, Nos. 46/2016-ST to 49/2016-ST dated 09.11.2016 which came into effect from 01.12.2016. Notification No. 46/2016-ST amended the Place of Provision of Services Rules so that the place of provision of an OIDAR service became the location of the recipient. The service now fell inside India whenever the customer was in India. The amendments also created a new class of recipient, the “non-assessee online recipient”, referred to here as the “NAOR”. The Service Tax Rules defined it as follows:
Liability was then divided in two. Where the recipient was a NAOR, the overseas provider became liable to pay service tax, and the reverse charge no longer applied to that supply. Where the recipient in India was anyone other than a NAOR, the recipient remained liable on reverse charge. If the overseas provider had a representative in India, that representative was liable. An overseas intermediary was also made liable, unless it met conditions showing it neither handled payment, authorised delivery nor set the terms of supply.
The compliance machinery followed the same pattern. Overseas providers registered through FORM ST-1A and filed returns in FORM ST-3C. Circular No. 202, dated 09.11.2016, explained that the total tax charged to the customer would be 15 per cent.
The Transition to GST
GST did not start from a blank page. It carried forward the service tax design and renamed its parts. The NAOR became the “non-taxable online recipient”, hereinafter referred to as the “NTOR”. The overseas provider’s duty to pay tax on B2C supplies became Section 14 of the IGST Act. The special registration became the SRS. The special return became FORM GSTR-5A. The timing was deliberate. Notification No. 1/2017-Integrated Tax brought Section 14 of the IGST Act into force on 22.06.2017, ahead of GST’s launch. The notification empowering officers to grant OIDAR registrations also took effect on 22.06.2017. Overseas suppliers could therefore register before the first day of GST.
One difference deserves notice. The service tax rules deemed an unregistered recipient to be a NAOR, whatever the purpose of use. The original GST definition of NTOR, by contrast, asked a second question about purpose, and this left a gap for unregistered business users until 01.10.2023. The 2023 amendments, which restored a registration-based test, are not repeated here. In effect, GST arrived at the position the service tax rules already held.
The Charging Provision and the Registration Mandate
Section 14(1) of the IGST Act fixes liability on the overseas supplier.
“On supply of online information and database access or retrieval services by any person located in a non-taxable territory and received by a non-taxable online recipient, the supplier of services located in a non-taxable territory shall be the person liable for paying integrated tax on such supply of services.”
The first proviso to Section 14(1) deals with intermediaries. An intermediary in the non-taxable territory is treated as the supplier unless certain conditions are met. In substance, these are that the invoice or receipt identifies the service and its true supplier, that the intermediary neither handles nor is responsible for payment, that it does not authorise delivery, and that it does not set the general terms of supply. These mirror the service tax conditions almost exactly.
Section 14(2) is the source of the SRS.
“The supplier of online information and database access or retrieval services referred to in sub-section (1) shall, for payment of integrated tax, take a single registration under the Simplified Registration Scheme to be notified by the Government.”
Two provisos follow.
“Provided that any person located in the taxable territory representing such supplier for any purpose in the taxable territory shall get registered and pay integrated tax on behalf of the supplier.”
“Provided further that if such supplier does not have a physical presence or does not have a representative for any purpose in the taxable territory, he may appoint a person in the taxable territory for the purpose of paying integrated tax and such person shall be liable for payment of such tax.”
The first proviso makes an Indian representative, where one exists, liable and bound to register. The second lets a supplier with no Indian presence appoint someone to pay on its behalf. It is optional, and the supplier may also register and pay directly.
How the Simplified Registration Scheme Works
The SRS is implemented through Rule 14 of the CGST Rules. Its present form reads as follows.
“Any person supplying online information and database access or retrieval services from a place outside India to a non-taxable online recipient or any person supplying online money gaming from a place outside India to a person in India shall electronically submit an application for registration, duly signed or verified through electronic verification code, in FORM GST REG-10, at the common portal, either directly or through a Facilitation Centre notified by the Commissioner.”
Rule 14(2) completes the process.
“The applicant referred to in sub-rule (1) shall be granted registration, in FORM GST REG-06, subject to such conditions and restrictions and by such officer as may be notified by the Central Government on the recommendations of the Council.”
Three features stand out. First, the application is online and made in FORM GST REG-10. Second, the certificate is issued in FORM GST REG-06. Third, the text of Rule 14 sets no turnover threshold. Registration depends on the nature of the supply, and not on its size.
Notification No. 2/2017-Integrated Tax, dated 19.06.2017, empowers the Principal Commissioner of Central Tax, Bengaluru West and officers subordinate to him to grant registration to overseas OIDAR suppliers serving NTORs. One jurisdiction therefore handles every overseas supplier, which is what makes the registration a “single” registration
Compliance After Registration
Registration is the start of the obligation, not the end of it. An overseas OIDAR supplier files FORM GSTR-5A under Section 39(5) of the CGST Act and Rule 64 of the CGST Rules. The return is monthly and due by the 20th of the month following the period.
Four conditions of the return are worth noting. A nil return must be filed even where there was no business activity in the period. No input tax credit is available to the supplier under this return, and it can be filed only after the tax and other dues are paid. A return for the current period cannot be filed until the return for the previous period has been filed. A single missed month can therefore block later filing until it is cleared.
Extension to Online Money Gaming
The same registration route was extended in 2023. From 01.10.2023, Notification No. 51/2023-Central Tax amended Rule 14 to cover overseas persons supplying online money gaming to a person in India. A corresponding Notification, No. 4/2023-Integrated Tax, gives the same Bengaluru West officers authority to register such suppliers. Online money gaming suppliers now use the same REG-10 route as OIDAR suppliers.
The SRS should not be confused with Rule 14A of the CGST Rules. Rule 14A is a separate scheme, effective 01.11.2025, for small domestic taxpayers with monthly output tax liability up to ₹2.5 lakh, with Aadhaar-based registration within three working days. It is meant for B2B suppliers. It has no connection to overseas OIDAR suppliers, who continue to register under Rule 14 through FORM GST REG-10.
AMLEGALS Remarks
India’s tax on overseas OIDAR suppliers was built in two steps. Service tax first brought these services into the taxable territory from 01.12.2016, by moving the place of provision to the recipient’s location and making the overseas provider liable for consumer supplies. GST then carried the same design forward under Section 14 of the IGST Act, with the SRS as its registration route.
For an overseas supplier, the practical points are these. Liability arises from the nature of the supply and the status of the recipient, and not from the size of the business. Registration is a single, online process under Rule 14 through FORM GST REG-10. Monthly FORM GSTR-5A filing follows, including nil returns, with tax paid before the return is filed. A supplier that treats registration as a one-time formality will find that the monthly return is where most compliance failures occur.
For any queries or feedback, feel free to connect with Dhwani.tandon@amlegals.com