Section 13 of the CGST Act, 2017 – Time of Supply of Services

Layman Meaning:
Section 13 tells us when GST becomes payable on a service transaction. In simple words, it determines the date on which the government considers a service to have been supplied for GST purposes.

General Rule

The Time of Supply of Services is the earlier of:

1. Date of issue of invoice, or
2. Date of receipt of payment.

Simple Example

• Consultancy service provided: 10 June
• Invoice issued: 15 June
• Payment received: 12 June

Time of Supply = 12 June (earlier date)

Therefore, GST liability arises on 12 June.

If Invoice is Not Issued Within Prescribed Time

The Time of Supply will be the earlier of:

• Date of provision of service, or
• Date of receipt of payment.

Reverse Charge Mechanism (RCM)

For services covered under RCM, the Time of Supply is the earlier of:

• Date of payment by recipient, or
• 60 days from supplier's invoice date.

Example:

• Advocate invoice dated: 1 June
• Payment made: 20 June

Time of Supply = 20 June

If payment is not made within 60 days, GST becomes payable on the expiry of 60 days from the invoice date.

Interest, Late Fee or Penalty

If additional amount is received as:

• Interest
• Late fee
• Penalty for delayed payment

GST liability arises on the date of receipt of such amount.

CA Exam / Practical Shortcut

One-Line Summary

Section 13 of CGST Act determines the date on which GST becomes payable on services, generally being the earlier of the invoice date or payment receipt date.