Skip to content

CA Final · Indirect Tax Laws · Supply under GST

Nair Agro Ltd, Kochi, registered, receives taxable goods from an unregistered supplier on 5 March, where tax is payable on reverse charge. The supplier issued an invoice on 28 February. Nair Agro paid the supplier on 12 April, entered in its books on 12 April. Which date is the time of supply under Section 12(3)?

The time of supply is 5 March. Under Section 12(3) the earliest of goods receipt, payment date and the day after thirty days from the supplier's invoice applies; receipt on 5 March precedes 12 April payment and the 31 March thirty-day date.

  1. A28 February
  2. B5 MarchCorrect
  3. C30 March
  4. D12 April

Explanation

For reverse charge, time of supply is the earliest of: receipt of goods (5 March); payment date (12 April); or the day following thirty days from invoice date. Thirty days from 28 February (non-leap year) ends 30 March, so the next day is 31 March. The earliest of 5 March, 12 April and 31 March is 5 March. Choosing 30 March misapplies the 'immediately following' rule.

Did you get it right without looking?

One question tells you little. A timed set on Supply under GST shows your real accuracy, how long you take and where you lose marks.

Practise Supply under GSTFree diagnostic mock

More Supply under GST questions