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TIME AND VALUSE OF SUPPLY UNDER MODEL GST LAW

Goods and Services Tax - GST - By: - Mr. M. GOVINDARAJAN - Dated:- 3-11-2016 - Time of supply The time of supply fixes the point when the liability to charge GST arises. Section 12 of the Act deals with the time of supply of goods and Section 13 of the Act deals with the time of supply of services. Time of supply of goods Section 12(2) provides that the time of supply of goods shall be the earliest of the following- (a) (i) the date on which the goods are removed by the supplier for supply to th .....

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plier issues the invoice with respect to the supply; or (c) the date on whichthe supplier receives the payment with respect to the supply; or (d) the date on which the recipient shows the receipt of the goods in his books of accounts. Explanation 2 to this Section provides that the supply shall be deemed to have been made to the extent it is covered by the invoice or the payment. Explanation 3 to this Section provides that the date on which the supplier receives the payment shall be the date on .....

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account, then the time of supply shall be- the date of issue of invoice; or the date of receipt of payment whichever is earlier. Section 12(4) gives powers to the Central Government or a Statement to specify, by notification, on the recommendation of the Council, the supply of goods that shall be treated as continuous supply of goods. Time of supply on reverse charge basis Section 12(5) provides that in case of supplies in respect of which tax is paid or liable to be paid on reverse charge basi .....

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ods sent on approval basis Section 12 (6) provides that if the goods, being sent or taken on approval or sale or return or similar terms, are removed before it is known whether a supply will take place, the time of supply shall be at the time when- it becomes known that the supply has taken place; or six months from the date of removal, whichever is earlier. Non possibility to determine the time of supply Section 12 (7) provides that in case it is not possible to determine the time of supply und .....

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of the provision of service or the date of receipt of payment, whichever is earlier, if the invoice is not issued within the prescribed period; 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 above two clauses do not apply. Explanation 1 to this section provides that the supply shall be deemed to have been made to the extent it is covered by the invoice or payment. Explanation 2 to this section provides that the date .....

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ice has been issued or any payment has been received by the supplier of the service; Where the due date of payment is not ascertainable from the contract, each such time when the supplier of service receives the payment, or issues an invoice, whichever is earlier; Where the payment is linked to the completion of an event, the time of completion of that event. Section 13(4) provides that the Central Government or a State Government may, on the recommendation of the Council, specify, by notificati .....

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on which the payment is made shall be- the date on which the payment is 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. Cessation of service Section 13(6) provides that in a case where supply of services ceases under a contract before the completion of supply, such services shall be deemed to have been provided at the time when the supply ceases. Non possibility to determine the time of supply Section 13(7) .....

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e tax rate has been fixed initially @ 5% and later on changed to 8%, 10%, 12% and 14%. In respect of continuous service, take example of telecommunication service, if the change in rate is effected in any period, care is to be taken to cover the new rate of tax on the date which it comes into effect. The change in rate of tax involves two kinds of situations- in case the taxable service has been provided before the change in effective rate of tax; and in case the taxable service has been provide .....

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ve rate of tax but the payment is received after the change in effective rate of tax, the time of supply shall be the date of issue of invoice; or where the payment is received before the change in effective rate of tad, but the invoice for the same has been issued after the change in effective rate of tax, the time of supply shall be the date of receipt of payment. The time of supply, in case that taxable service has been provided after the change in effective rate of tax, shall be determined i .....

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the change in effective rate of tax but the payment is received before the change in effective rate of tax, the time of supply shall be the date of issue of invoice. The explanation to this section provides that the date of receipt of payment shall be the date on which the payment is entered in the books of accounts of the supplier or the date on which the payment is credited to his bank account, whichever is earlier. The date of receipt of payment shall be the date of credit in the bank accoun .....

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supply. Inclusion in transaction value Section 15(2) provides that the transaction value shall include- 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 and/or services; the value, apportioned as appropriate, of such goods and/or services as are supplied directly or indirectly by the recipient of the supply free of charge or at reduced cost for u .....

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