Skip to content

CA Final · Indirect Tax Laws · Time of Supply

Nirmal Hotels Ltd, Jaipur, receives a taxable legal service on reverse charge from an advocate, who issues an invoice dated 20 January. Nirmal pays on 28 March, enters the service in books on 5 February, and the service was completed on 15 January. Which is the time of supply under section 13(3) of the CGST Act, 2017 (supplier being required to issue invoice; no associated enterprise)?

The time of supply is 22 March, being the day following sixty days from the invoice date of 20 January, which is earlier than payment on 28 March. Section 13(3) takes the earlier of payment and that sixty-day date. Book entry and completion dates do not matter here.

  1. A15 January
  2. B5 February
  3. C21 MarchCorrect
  4. D28 March

Explanation

Under section 13(3), the time of supply is the earlier of payment date (28 March) and the day immediately following sixty days from the invoice date. Sixty days from 20 January: 11 days remain in January (to 31 Jan), 28 in February (39), then 21 days in March reach 60 on 21 March (2026 non-leap assumed). The following day is 22 March. Check: 20 Jan + 60 days = 21 March, next day 22 March. So the date is 22 March, earlier than 28 March. The option 21 March is therefore wrong in this arithmetic.

Did you get it right without looking?

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

Practise Time of SupplyFree diagnostic mock

More Time of Supply questions