Last updated: December 17th, 2019 5:25 PM

Supply of Goods - Under Indian GST

Under GST, supply includes all forms of supply of goods and/or services such as sale, transfer, barter, exchange, license, rental, lease or disposal made or agreed to be made for consideration by a person in the course or furtherance of business. In this article, we look at the applicability of GST on supply of goods.

Supply of Goods

The liability to pay Central GST or State GST on the goods arises at the earliest of the following dates:

• The date on which the goods are removed by the supplier for supply to the recipient, in a case where the goods are required to be removed or
• The date on which the goods are made available to the recipient, in a case where the goods are not required to be removed; or
• The date on which the supplier issues the invoice with respect to the supply; or
• The date on which the supplier receives the payment with respect to the supply; or
• The date on which the recipient shows the receipt of the goods in his books of account.

In case of supply of goods where the goods are physically not capable of being moved like goods supplied in assembled or installed form, applicability of GST would arise on the goods being made available to the recipient or at the disposal of the recipient.

Continuous Supply of Goods

In case of continuous supply of goods, where successive statements of accounts or successive payments are involved, time of supply under GST would be the date of expiry of the period to which such successive statements of accounts or successive payments relate. If there are no successive statements of account, then the date of issue of the invoice (or any other document) or the date of receipt of payment, whichever is earlier, would be the time of supply. Further, in case of supplies in respect of which tax is paid or liable to be paid on reverse charge basis, the time of supply shall be the earliest of the following dates:

• The date of the receipt of goods, or
• The date on which the payment is made, or
• The date of receipt of invoice, or
• The date of debit in the books of accounts.

The date on which the payment is made is the date on which the payment is entered in the books of accounts of the recipient or the date on which the payment is debited in his bank account, whichever is earlier. Also, 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. In case it is not possible to determine the time of supply as above, then time of supply of goods would be the time where a periodical return has to be filed, be the date on which such return is to be filed, or the date on which the CGST/SGST is paid.