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

Under Section 12(2) of the CGST Act, 2017, the time of supply of goods by a regular supplier (forward charge) is determined as:

The time of supply of goods under forward charge is the earlier of the invoice issue date, or the last date on which the invoice should have been issued, and the date the supplier receives payment. The law chooses the earlier event so that tax liability arises as soon as either occurs.

  1. AThe date of delivery of goods to the recipient, irrespective of invoice or payment
  2. BThe earlier of the date of issue of invoice (or the last date on which the invoice is required to be issued) and the date of receipt of paymentCorrect
  3. CThe later of the date of invoice and the date of receipt of payment
  4. DThe date on which the supplier files the periodical return for the supply

Explanation

Section 12(2) fixes the time of supply of goods as the earlier of two dates: the invoice date (or the last date by which the invoice must be issued) and the date the supplier receives payment. The 'later of' option reverses the rule. Delivery date and return filing date are not the primary tests.

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