# Section 12 – Time of Supply of Goods
## Sec 12(1) – Charging Rule
Liability to pay tax on goods arises at the time of supply determined under this section.
## Sec 12(2) – Forward Charge: Earlier of Two Dates
(a) Date of issue of invoice by supplier, OR the last date by which invoice ought to have been issued under Sec 31 (to the extent invoice covers the supply); OR
(b) Date of receipt of payment by supplier (to the extent payment covers the supply).
### CG's Special Procedure – No Tax on Advance for Goods (Notification 66/2017-CT)
- Under Section 148, CG notified that GST on outward supply of goods is payable only as per Sec 12(2)(a) — i.e., invoice date.
- Exceptions: composition suppliers and suppliers of specified actionable claims.
- Effect: For supply of goods under forward charge, GST is NOT payable on advance; date of receipt of payment becomes irrelevant.
- Important: This relief is only for goods — NOT services.
### Explanation 2 to Sec 12(2) – "Date of Receipt of Payment"
Earlier of:
- Date payment is recorded in the books of the supplier, OR
- Date payment is credited to the supplier's bank account.
### Explanation 1 – Significance of "to the extent invoice/payment covers the supply"
If part consideration is advanced or part-invoice raised, time of supply applies only to that portion.
### Sec 31 – Time Limit for Issuing Invoice (Goods)
| Situation | Time Limit |
|---|---|
| Supply involves movement | Before or at the time of removal of goods |
| No movement | Before or at the time of delivery / making available |
| Continuous supply of goods | Before or at the time of issuing periodical statement / receiving periodical payment |
| Goods sent on approval (sale or return) | Before/at supply OR within 6 months from removal, whichever earlier |
### Proviso – Excess Payment ≤ ₹1,000
If supplier receives up to ₹1,000 in excess of invoiced amount, the supplier may treat the invoice date as time of supply for the excess. (Practically irrelevant for goods under forward charge because of Notification 66/2017.)
## Sec 12(3) – Reverse Charge: Earliest of Three Dates
(a) Date of receipt of goods, OR
(b) Date payment is recorded in recipient's books OR debited from recipient's bank — earlier, OR
(c) Date immediately following 30 days from date of issue of invoice by supplier.
Fallback: If none determinable → date of entry in recipient's books.
Key contrast: Unlike forward charge, GST IS payable on advance under reverse charge if payment is made before receipt of goods.
## Sec 12(4) – Vouchers Exchangeable for Goods
- If supply is identifiable at the time of issue → date of issue of voucher.
- If not identifiable → date of redemption of voucher.
## Sec 12(5) – Residual
Where Sec 12(2)–(4) do not apply:
- Due date for filing periodical return (where return is to be filed); OR
- In any other case, date on which GST is paid.
## Sec 12(6) – Interest / Late Fee / Penalty for Delayed Payment
Time of supply for any addition to value on account of interest/late fee/penalty = Date on which the supplier RECEIVES such additional amount.