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Under GST, the levy of tax on manufacture, place of provision of service and point of taxation of services will be replaced by the concept of “Supply”.

The time of “supply” can be classified under the two broad heads, namely:-

• Time of supply of goods
• Time of supply of services

Time Of Supply Of Goods

The liability to pay taxes on goods will increase at the time of supply, and are defined under Section 12, which state 

The time of supply of goods shall be earlier of the following dates, namely:-

• The date of issue of invoice by the supplier or the last date on which he is required, under the prescribed provision, to issue the invoice with respect to the supply; or
• The date on which the supplier receives the payment with respect to the supply.

Here, the “date on which the supplier receives the payment” would mean earlier of the following two dates, namely:-

• The date on which the payment is entered in his books of accounts, or
• The date on which the payment is credited to his bank account.

For example, ABC Enterprises issued an invoice to Sachin Limited on 30th Sep 2017. Sachin Ltd made a payment to ABC Enterprises on 2nd Oct 2017 and further, ABC Enterprises credited the entry in their books on 3rd Oct 2017. In this case in the last para, time of supply shall be 30th Sep 2017.

Supply Of Goods On Which Tax Levy Is On “Reverse Charge Basis”

The time of supply of goods shall be earlier of the following dates, namely:-

• The date of the receipt of goods; or
• 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
• The date following thirty days from the date of issue of invoice, by the supplier

Time Of Supply Of Services

The liability to pay taxes on services will increase at the time of supply, and are defined under Section 13, which state:-

The time of supply of services shall be earlier of the following dates, namely:-

• The date of issue of invoice by the supplier, if the invoice is issued within the period prescribed or the date of receipt of payment, whichever is earlier; or
• If the invoice is not provided within the time prescribed or the date of receipt of payment (The date of provision of service), whichever is earlier; or
• The date on which the recipient shows the receipt of services in his/her books of account, in a case where the provisions of clause (a) or clause (b) do not apply

Here, the “date on which the supplier receives the payment” would mean earlier of the following two dates, namely,-

• The date on which the payment is entered in his books of accounts, or
• The  date on which the payment is credited to his bank account.

Supply Of Services On Which Tax Levy Is On “Reverse Charge Basis”

• 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
• The date immediately following sixty days from the date of issue of invoice by the supplier.

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