Normally, suppliers of goods or services collect GST from the receivers and deposit it with the tax authorities.

But under the reverse charge mechanism, receivers of goods or services pay the tax instead of suppliers.

When Is Reverse Charge Applicable?

Supply From Unregistered Dealer To Registered Dealer – If you are a registered dealer who purchases goods/services from an unregistered dealer, you as a registered dealer must pay the GST. However, you  are exempt from paying GST if your purchases from the unregistered seller do not exceed Rs. 5,000.

Supply of Goods and Services Specified By CBEC- If you are purchasing goods/services which are specified by the CBEC under reverse charge, you as a recipient must pay GST. These include: (i) goods transport services, (ii) insurance agencies, (iii) recovery agencies, (iv) legal services, (v) transportation services for imported goods etc.

Services Provided By An E – Commerce Operator – In case you are an e-commerce operator supplying services, reverse charge will apply to you.  Hence, you as an e-commerce operator are responsible to pay the GST.
For example,  in case of transport service provided by taxi aggregator OLA, OLA is liable to pay the GST. OLA will collect tax from passengers instead of the registered service providers. There are cases where an e-commerce operator does not have a physical presence in the taxable territory. In such a case, a person representing such e-commerce operator for any purpose will be liable to pay tax. If there is no such representative, the operator would  appoint a representative. He will be held liable to pay GST.