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CMA Final · Indirect Tax Laws and Practice · Time of Supply

Under the CGST Act, 2017, a supplier of taxable goods receives Rs. 800 more than the amount shown in the tax invoice. Which statement correctly describes the time of supply for this excess amount?

Where a supplier of goods receives up to Rs. 1,000 more than the invoice value, the time of supply for that excess is, at the supplier's option, the date of issue of the invoice for the excess amount. Rs. 800 falls within the limit, so the option is available.

  1. AIt is always the date on which the excess amount is received
  2. BAt the supplier's option, the time of supply for the excess is the date of issue of the invoice for that excess amountCorrect
  3. CIt is always the date of the original invoice
  4. DIt is the date on which the recipient records the goods in his books

Explanation

The proviso to section 12(2) covers an excess receipt of up to Rs. 1,000 over the invoiced amount. At the supplier's option, the time of supply for the excess is the date of the invoice issued for it. Rs. 800 is within the limit. The option that fixes the date of receipt as mandatory ignores this optional treatment.

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