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CA Intermediate · Taxation · Time of Supply

Vikram Logistics (registered) received ₹1,00,000 on 5 May 2026 from Rahul Ltd as an advance for a service whose value is not yet known. Vikram Logistics supplied the service on 10 June 2026 and issued an invoice on 25 June 2026 for ₹1,50,000, raising the supply within 30 days. Payment of the balance ₹50,000 was received on 15 July 2026. Under the CGST Act, what are the times of supply?

Time of supply is 5 May 2026 for ₹1,00,000 and 25 June 2026 for ₹50,000. Because the invoice was issued in time, each portion takes the earlier of invoice date and payment date, and the balance was invoiced before it was paid.

  1. A5 May 2026 for ₹1,00,000 and 25 June 2026 for ₹50,000Correct
  2. B5 May 2026 for ₹1,00,000 and 15 July 2026 for ₹50,000
  3. C10 June 2026 for ₹1,50,000
  4. D25 June 2026 for ₹1,50,000

Explanation

For services with invoice issued within the prescribed period, time of supply is the earlier of invoice date and payment date. Advance of ₹1,00,000 received 5 May precedes the invoice, so time of supply for that part is 5 May. For the balance ₹50,000 the invoice date 25 June is earlier than payment on 15 July, so it is 25 June. Option 1 wrongly uses payment date for the balance.

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