TIME AND VALUE OF SUPPLY
12. Time of supply of goods .
(1) The liability to pay tax on goods shall arise at the time of supply,
as determined in accordance with the provisions of this section.
(2) The time of supply of goods shall be the earlier of the following dates,
namely :—
(a) the date of issue of invoice by the supplier or the last date on
which he is required, under sub-section (1) of section 31, to issue the
invoice with respect to the supply ; or
(b) the date on which the supplier receives the payment with respect
to the supply :
Provided that where the supplier of taxable goods receives an amount
up to one thousand rupees in excess of the amount indicated in the tax
invoice, the time of supply to the extent of such excess amount shall, at
the option of the said supplier, be the date of issue of invoice in respect
of such excess amount.
Explanation 1.––For the purposes of clauses (a) and (b), “supply”
shall be deemed to have been made to the extent it is covered by the
invoice or, as the case may be, the payment.
Explanation 2.––For the purposes of clause (b), “the date on which
the supplier receives the payment” shall be the date on which the
payment is entered in his books of account or the date on which the
payment is credited to his bank account, whichever is earlier.
(3) In case of supplies in respect of which tax is paid or liable to be paid
on reverse charge basis, the time of supply shall be the earliest of the following
dates, namely :—
(a) the date of the receipt of goods ; or
(b) the date of payment as entered in the books of account of the
recipient or the date on which the payment is debited in his bank account,
whichever is earlier ; or
(c) the date immediately following thirty days from the date of issue
of invoice or any other document, by whatever name called, in lieu thereof
by the supplier :
Provided that where it is not possible to determine the time of supply
under clause (a) or clause (b) or clause (c), the time of supply shall be the
date of entry in the books of account of the recipient of supply.
(4) In case of supply of vouchers by a supplier, the time of supply shall
be—
(a) the date of issue of voucher, if the supply is identifiable at that
point ; or
(b) the date of redemption of voucher, in all other cases.
(5) Where it is not possible to determine the time of supply under the
provisions of sub-section (2) or sub-section (3) or sub-section (4), the time of
supply shall––
(a) in a case where a periodical return has to be filed, be the date on
which such return is to be filed ; or
(b) in any other case, be the date on which the tax is paid.
(6) The time of supply to the extent it relates to an addition in the value
of supply by way of interest, late fee or penalty for delayed payment of any
consideration shall be the date on which the supplier receives such addition
in value.
13. Time of supply of services
(1) The liability to pay tax on services shall arise at the time of
supply, as determined in accordance with the provisions of this section.
(2) The time of supply of services shall be the earliest of the following
dates, namely :—
(a) the date of issue of invoice by the supplier, if the invoice is issued
within the period prescribed under sub-section (2) of section 31 or the
date of receipt of payment, whichever is earlier ; or
(b) the date of provision of service, if the invoice is not issued within
the period prescribed under sub-section (2) of section 31 or the date of
receipt of payment, whichever is earlier ; or
(c) the date on which the recipient shows the receipt of services in
his books of account, in a case where the provisions of clause (a) or clause
(b) do not apply :
Provided that where the supplier of taxable service receives an
amount upto one thousand rupees in excess of the amount indicated in
the tax invoice, the time of supply to the extent of such excess amount
shall, at the option of the said supplier, be the date of issue of invoice
relating to such excess amount.
Explanation.––For the purposes of clauses (a) and (b)—
(i) the supply shall be deemed to have been made to the extent
it is covered by the invoice or, as the case may be, the payment ;
(ii) “the date of receipt of payment” shall be the date on which
the payment is entered in the books of account of the supplier or the date on which the payment is credited to his bank account, whichever is earlier.
(3) In case of supplies in respect of which tax is paid or liable to be paid
on reverse charge basis, the time of supply shall be the earlier of the following
dates, namely :––
(a) the date of payment as entered in the books of account of the
recipient or the date on which the payment is debited in his bank account,
whichever is earlier ; or
(b) the date immediately following sixty days from the date of issue
of invoice or any other document, by whatever name called, in lieu thereof
by the supplier :
Provided that where it is not possible to determine the time of supply
under clause (a) or clause (b), the time of supply shall be the date of
entry in the books of account of the recipient of supply :
Provided further that in case of supply by associated enterprises,
where the supplier of service is located outside India, the time of supply
shall be the date of entry in the books of account of the recipient of
supply or the date of payment, whichever is earlier.
(4) In case of supply of vouchers by a supplier, the time of supply shall
be––
(a) the date of issue of voucher, if the supply is identifiable at that
point ; or
(b) the date of redemption of voucher, in all other cases.
(5) Where it is not possible to determine the time of supply under the
provisions of sub-section (2) or sub-section (3) or sub-section (4), the time of
supply shall––
(a) in a case where a periodical return has to be filed, be the date on
which such return is to be filed ; or
(b) in any other case, be the date on which the tax is paid.
(6) The time of supply to the extent it relates to an addition in the value
of supply by way of interest, late fee or penalty for delayed payment of any
consideration shall be the date on which the supplier receives such addition
in value.
14. Change in rate of tax in respect of supply of goods or services.
Notwithstanding anything contained in section 12 or section 13,
the time of supply, where there is a change in the rate of tax in respect of
goods or services or both, shall be determined in the following manner,
namely :––
(a) in case the goods or services or both have been supplied before
the change in rate of tax,––
(i) where the invoice for the same has been issued and the
payment is also received after the change in rate of tax, the time of
supply shall be the date of receipt of payment or the date of issue of
invoice, whichever is earlier ; or
(ii) where the invoice has been issued prior to the change in
rate of tax but payment is received after the change in rate of tax,
the time of supply shall be the date of issue of invoice ; or
(iii) where the payment has been received before the change in
rate of tax, but the invoice for the same is issued after the change in
rate of tax, the time of supply shall be the date of receipt of payment ;
(b) in case the goods or services or both have been supplied after
the change in rate of tax,––
(i) where the payment is received after the change in rate of
tax but the invoice has been issued prior to the change in rate of
tax, the time of supply shall be the date of receipt of payment ; or
(ii) where the invoice has been issued and payment is received
before the change in rate of tax, the time of supply shall be the date
of receipt of payment or date of issue of invoice, whichever is earlier ;
or
(iii) where the invoice has been issued after the change in rate
of tax but the payment is received before the change in rate of tax,
the time of supply shall be the date of issue of invoice :
Provided that the date of receipt of payment shall be the date
of credit in the bank account if such credit in the bank account is
after four working days from the date of change in the rate of tax.
Explanation.––For the purposes of this section, “the date of
receipt of payment” shall be the date on which the payment is
entered in the books of account of the supplier or the date on which
the payment is credited to his bank account, whichever is earlier.
15. Value of taxable supply.
(1) The value of a supply of goods or services or both shall be the
transaction value, which is the price actually paid or payable for the said
supply of goods or services or both where the supplier and the recipient of
the supply are not related and the price is the sole consideration for the
supply.
(2) The value of supply shall include–––
(a) any taxes, duties, cesses, fees and charges levied under any law
for the time being in force other than this Act, the Central Goods and
Services Tax Act and the Goods and Services Tax (Compensation to
States) Act, if charged separately by the supplier ;
(b) any amount that the supplier is liable to pay in relation to such
supply but which has been incurred by the recipient of the supply and
not included in the price actually paid or payable for the goods or services
or both ;
(c) incidental expenses, including commission and packing, charged
by the supplier to the recipient of a supply and any amount charged for
anything done by the supplier in respect of the supply of goods or services
or both at the time of, or before delivery of goods or supply of services ;
(d) interest or late fee or penalty for delayed payment of any
consideration for any supply ; and
(e) subsidies directly linked to the price excluding subsidies
provided by the Central Government and State Governments.
Explanation.––For the purposes of this sub-section, the amount of
subsidy shall be included in the value of supply of the supplier who
receives the subsidy.
(3) The value of the supply shall not include any discount which is given—
(a) before or at the time of the supply if such discount has been duly
recorded in the invoice issued in respect of such supply ; and
(b) after the supply has been effected, if—
(i) such discount is established in terms of an agreement entered
into at or before the time of such supply and specifically linked to
relevant invoices ; and
(ii) input tax credit as is attributable to the discount on the
basis of document issued by the supplier has been reversed by the
recipient of the supply.
(4) Where the value of the supply of goods or services or both cannot be
determined under sub-section (1), the same shall be determined in such
manner as may be prescribed.
(5) Notwithstanding anything contained in sub-section (1) or sub-section
(4), the value of such supplies as may be notified by the Government on the
recommendations of the Council shall be determined in such manner as may
be prescribed.
Explanation.—For the purposes of this Act,—
(a) persons shall be deemed to be “related persons’’ if —
(i) such persons are officers or directors of one another’s businesses ;
(ii) such persons are legally recognised partners in business ;
(iii) such persons are employer and employee ;
(iv) any person directly or indirectly owns, controls or holds
twenty-five per cent. or more of the outstanding voting stock or
shares of both of them ;
(v) one of them directly or indirectly controls the other ;
(vi) both of them are directly or indirectly controlled by a third person ;
(vii) together they directly or indirectly control a third person ; or
(viii) they are members of the same family ;
(b) the term “person” also includes legal persons ;
(c) persons who are associated in the business of one another in that one is the sole agent or sole distributor or sole concessionaire, howsoever described, of the other, shall be deemed to be related.
