CS Professional · Goods and Services Tax (GST) and Corporate Tax Planning · Time of Supply
Under Section 12 of the CGST Act, 2017, the liability to pay tax on goods arises at which point?
The liability to pay tax on goods arises at the time of supply, which is determined in accordance with the provisions of Section 12 of the CGST Act. It is not tied to return filing, year end, or merely delivery.
- AAt the time of supply, determined as per Section 12Correct
- BAt the date of filing the monthly return
- CAt the date the goods are delivered to the buyer's godown only
- DAt the end of the financial year in which the supply occurs
Explanation
Section 12(1) states that the liability to pay tax on goods arises at the time of supply, determined under that section. Return filing date and year end are not triggers, and the delivery date is only one of several possible determinants in specific cases such as reverse charge.
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