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CA Intermediate · Taxation · Time of Supply

Anand Consultancy, a registered service provider in Pune, completed a consultancy service on 5 March. The invoice is issued on 30 March. It received payment on 10 April. The invoice should have been issued within 30 days from the date of supply of service. What is the time of supply of this service under forward charge?

The time of supply is 30 March. Where a service invoice is issued within the prescribed 30 days, time of supply is the earlier of the invoice date and the payment date. The invoice of 30 March precedes the payment on 10 April, and the invoice was within time.

  1. A5 March
  2. B30 MarchCorrect
  3. C10 April
  4. D4 April

Explanation

For services under forward charge, if the invoice is issued within the prescribed period (30 days; 45 days for banks/insurers/NBFCs), time of supply is the earlier of the invoice date and the date of receipt of payment. The invoice was issued on 30 March, which is within 30 days of 5 March and is earlier than payment on 10 April. Hence 30 March. The completion date of 5 March applies only where the invoice is not issued within the prescribed period.

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