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MCQ Self Challenge # 0077 on Time of Supply under GST in case of Change in Rate of Tax

 

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 #MCQ 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 answer of these MCQs shall be posted next day for the self assessment of the participants.

MCQ 77.1 An online portal, Online info, raises 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 in above question?

A. OLD Rate.
B. NEW Rate.
C. Rate on the date of issue of invoice .
D. None of the above.

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CA Sanjay Kumar Agrawal
Mobile: 9810116321

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Answer MCQ Self Challenge #0077

 

Dear Professional Seniors & Friends,

Warm Greetings!

 

This post of MCQ is on provisions relating to time of supply under GST in case of change in 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 a layman language, one can opine, that rate of tax shall be applicable where any two events out of three(invoice, payment, supply) occurs.
  • For identifying time of supply, please refer the below table which is divided in two parts on the basis of 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.ConditionTime of SupplyApplicable Rate
AWhen invoice is issued and payment is received before change in Rate of TaxEarlier of-

a)Date of Receipt of Payment

b)Date of Issue of Invoice

Old Rate
BInvoice is issued after the change in rate of tax but payment received beforeDate of issue of invoiceNew Rate
CPayment is received after the change in rate of tax but invoice issued beforeDate of receiving paymentNew Rate

 

In case of goods or Services or Both have been supplied BEFORE the change in Rate of Tax

S.No.ConditionTime of SupplyApplicable Rate
DWhen invoice is issued and payment is received after change in Rate of TaxEarlier of-

a)Date of Receipt of Payment

b)Date of Issue of Invoice

New Rate
EInvoice is issued after the change in rate of tax but payment received beforeDate of receiving paymentOLD Rate
FPayment is received after the change in rate of tax but invoice issued beforeDate of issue of invoice

 

OLD Rate

 

  • Our MCQ falls in situation A where invoice and payment has been received before but supply of services have been made after change in 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 MCQ 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 professional opinion; you can definitely have your own opinion.)

 

Sincere Regards!

CA Sanjay Kumar Agrawal

Mobile: 9810116321

 

To access MCQ posts regularly, please Join Telegram Channel:
https://t.me/caSanjayKumarAgrawal

 

For All MCQ post please click on:

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