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CS Professional · Goods and Services Tax (GST) and Corporate Tax Planning · Supply under GST

Ramesh Traders supplies goods to an unrelated buyer at an invoice price of ₹80,000. The invoice separately records a trade discount of ₹5,000 given at the time of supply, so the buyer pays ₹75,000 for the goods. The supplier also charges ₹1,500 as interest for delayed payment of this invoice. Ignoring GST, what is the value of supply?

The value of supply is ₹76,500. The ₹5,000 discount recorded in the invoice at the time of supply is excluded, leaving ₹75,000, and interest for delayed payment is included under Section 15(2)(d), adding ₹1,500.

  1. A₹75,000
  2. B₹76,500Correct
  3. C₹80,000
  4. D₹81,500

Explanation

The discount recorded in the invoice at the time of supply is excluded under Section 15(3)(a), giving 80,000 - 5,000 = 75,000. Interest for delayed payment is included under Section 15(2)(d): 75,000 + 1,500 = ₹76,500. Option ₹81,500 ignores the discount.

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