Know Time Of Supply Under GST In Case Of Change In Rate Of Tax

MCQ SELF CHALLENGE # 0077 ON TIME OF SUPPLY UNDER GST IN CASE OF CHANGE IN RATE OF TAX

Dear Professional Seniors & Friends,

Warm Greeting!

Here is the Next post of tax consultant in Gurgaon on concept-based practical professional knowledge on Time of Supply under GST in case of change in rate of tax in a unique manner to be self-answered by participants. The detailed answers to these MCQs shall be posted the next day for the self-assessment of the participants

MCQ 77.1 An online portal, Online into, raises an invoice for database access on 20th March 2017 on XYZ Ltd. The Payment is made by XYZ Ltd by a demand draft sent 24th March 2017. Online Info encashes the demand draft and thereafter, gives access to the database to XYZ Ltd from 4th April. In the meanwhile, the rate of Tax is Changed From 1st April 2017. What is the time of supply of Service of Data Base Access by Online Info

A. 20-03-2017

B. 24-03-2017

C. 28-03-2017

D. 04-04-2017

MCQ 77.2. What will be the tax rate applicable to the above question?

A. OLD Rate.

B. NEW late

C. Rate on the date of issue of invoice.

D. None of the above.

Answer MCQ Self Challenge #0077

This post of MCQ is on provisions relating to the time of supply under GST in case of a change in the rate of tax.

Answer to MCQ 77.1:

A) 20-03-2017

Answer to MCQ 77.2:

A) OLD Rate

Practical Analysis for MCQ 77.1 &.77.2

• Section 14 provides the cases to determine the time of supply where there is a change in the rate of Tax in respect of Goods or Services or both
• In layman language one can opine that the rate of tax shall be applicable where any two events out of three invoice, payment, supply) occurs
• For identifying the time of supply, please refer to the below table which is divided into two parts on the basis of the supply of services either before or after.

In case of goods or services or Both have been supplied AFTER the change in Rate of Tax

S.No. A

Condition

When an invoice is issued and payment is payment received before the change in Rate of Tax

Time of Supply Earlier of

A) Date of Receipt of payment

B)j Date of Issue of Invoice

Applicable Rate

Old Rate

S.No. B

Condition

Invoice is issued after the change in rate of tax but payment received before

Time of Supply Earlier of

Date of Issue of Invoice

Applicable Rate

New Rate

S.No. C

Condition

Payment is received after the change in rate of tax but invoice issued before

Time of Supply Earlier of

Date of issue of invoice

Applicable Rate

New Rate

S.No. D

Condition

When invoice is issued and payment received after change in Rate of Tax

Time of Supply Earlier of

A) Date of Receipt of payment

B) Date of Issue of Invoice

Applicable Rate

New Rate

S.No. E

Condition

Invoice is issued after the change in rate of tax but payment received before

Time of Supply Earlier of

Date of Receipt of payment

Applicable Rate

Old Rate

S.No. E

Condition

Payment is received after the change in rate of tax but invoice issued before

Time of Supply Earlier of

Date of Issue of Invoice

Applicable Rate

Old Rate

• Our MCO falls in situation A where invoice and payment have been received before but the supply of services has been made after a change in the rate of tax
• Based on the above analysis correct answer to MCQ 77.1 : A) 20-03-2017 i.e. earlier of date of issue of invoice of date of receiving payment.
• Correct answer to MCQ 77.2: OLD Rate since two events occur before change in rate of tax

(Disclaimer: The objective of the MCD post is just to discuss the concept. It may happen, by change of facts, the answer may be different. Please do not treat this as a professional opinion you can definitely have your own opinion)

Sincere Regards!

CA Sanjay Kumar Agrawal

Mobile: 9810116321