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CMA Final · Indirect Tax Laws and Practice · Time of Supply

Aarav Traders (registered) receives taxable goods on reverse charge basis from an unregistered supplier. Goods are received on 12 June 2027. The supplier's document is dated 1 June 2027. Payment is debited to the recipient's bank account on 25 June 2027 and entered in books on 22 June 2027. Under section 12(3) of the CGST Act, 2017, the time of supply is:

The time of supply is 12 June 2027. Under section 12(3) the earliest of the date of receipt of goods, the earlier payment date (22 June) and the date following thirty days from the supplier's document (2 July) applies, and receipt of goods on 12 June is earliest.

  1. A22 June 2027
  2. B12 June 2027Correct
  3. C1 July 2027
  4. D25 June 2027

Explanation

Section 12(3) takes the earliest of: receipt of goods (12 June), payment date being the earlier of books entry or bank debit (22 June), and the day after thirty days from the invoice date (2 July). The earliest is 12 June 2027.

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