GST Registration Suspension of Cloudtail (Amazon Seller) Led to Major Supply Disruption

Cloudtail India is one of the largest sellers on Amazon.in Platform, recently its Goods and Service Tax (GST) registration was suspended in Haryana and due to this, the seller faced a major supply disruption.

Cloudtail India is an Amazon-affiliated company owned by Prione Business Services, a joint venture between Amazon Asia-Pacific Holdings Private Limited and Infosys founder NR Narayana Murthy’s Catamaran Ventures. Amazon Asia-Pacific Holdings controls less than 25% of the company.

However, it had to wait 20 hours until GST registration was reinstated which caused chaos. In these hours, vendors were unable to generate e-way bills Get to know about GST E Way bill and its generating process through online and SMS in a simple manner. Also, we have attached original screenshots of official E way bill portal for better understanding to send their supplies to Cloudtail warehouses in Haryana. Cloudtail has fulfillment centers located in Mewat, Gurgaon, Jamalpur, and Sonipat.

This delay in generating the e-way bill means that Cloudtail cannot make appointments for deliveries, which will cause a delay of 24 to 48 hours for inbound shipments.

A Cloudtail spokesperson stated that “We would like to reiterate that Cloudtail’s Haryana GST registration is current and valid. We continue to operate in adherence to all applicable GST requirements”. However, no definite reason was cited for its GST registration being suspended.

One Tax Official stated that The suspension may be either due to an outstanding demand that was not complied with by the company or availed of an additional input tax credit (ITC) A complete guide for understanding the basics of input tax credit and it calculation with detailed examples under GST (Goods and Services Tax) India which was not to be taken.

Meanwhile, Law states that GST Registration can be canceled:

• If a company failed to file returns for six months
• For collecting additional input tax credit on the basis of fake invoices or bills
• Taking wrongful tax exemption
• Have not started business operations after six months of taking GST registration

As per regulatory filings, Cloudtail India had reported a 25% rise in revenues for 2018-19 at INR 8,945 Cr resulting in a profit of INR 29.4 Cr. In February 2019, Catamaran Ventures increased its stake in Cloudtail’s parent company from 51% to 76%. Thus, after the introduction of Press Note 2, the stake of joint venture partner Amazon Asia reduced from 49% to 24%. After this, Cloudtail was no longer an Amazon group company and became eligible for sale on the market.

However, the reason for its GST registrationGet to know the complete GST registration procedure online on the Indian government GST portal official website. We have explained by the actual screenshot of every step being suspended is still unknown but their GST registration was restored after waiting for 20 hours.