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CS Executive · Tax Laws and Practice · Time, Value and Place of Supply

Kiran Traders receives a service on reverse charge from a supplier who must issue an invoice. The supplier's invoice is dated 1 March, and the recipient has not yet paid. Under section 13(3) of the CGST Act, 2017, which date is the time of supply if payment is made on 15 June?

The time of supply is the date immediately following sixty days from the supplier's invoice date, which is 1 May. Under the reverse charge rule it is the earlier of the payment date and that date, and 1 May falls before the 15 June payment.

  1. A15 June, the date of payment
  2. B1 March, the invoice date
  3. CThe date immediately following sixty days from 1 MarchCorrect
  4. DThe date of entry in the recipient's books, as the first fallback

Explanation

For reverse charge, the time of supply is the earlier of the payment date and the date immediately following sixty days from the invoice date. Sixty days from 1 March ends on 30 April, so the following day, 1 May, is earlier than 15 June. Hence 1 May applies, not the payment date.

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