Page 17 - Chapter 5 TOS

5. Amount credited in Bank account 18th October
6. Rate changed from 12% to 18% 16th October

Note: Assume that all the days covered in the above case are working days
[Study mat] [CA Final MTP May 23]
Answer:- Legal Provision:
Ü As per explanation to section 14 of CGST Act 2017, in case of change in rate of tax, the date of receipt of
payment is the earlier of the:
Ø date on which the payment is entered in the books of account of the supplier or
Ø date on which the payment is credited to his bank account.
Ü However, the date of receipt of payment is the date of credit in the bank account if such credit in the bank
account is after 4 working days from the date of change in the rate of tax
Ü As per section 14(a)(iii) of CGST Act 2017, if the service is supplied before the change in rate of tax and the
invoice is issued after the change in rate of tax but the payment is received before such change in rate of tax, the
time of supply will be date of receipt of payment.
Discussion & Conclusion :
Ü In the given case, the payment has been credited in the bank account within 4 working days from the date of
change in the rate of tax.
Ü The date of receipt of payment is 15th October being the date of entry in the books of account of the supplier
which is earlier than the date of credit of the payment in the bank account (18th October).
Ü Therefore, time of supply is 15th October

Q.19
Anuja checked-in at the 'Welcome Tourist Lodge' in Madurai on 15th July, 20XX. The room rent for
the same was ₹ 900 per day for a single room. She checked-out on 17th of July 20XX and payment in respect
to the same was received by the lodge via cheque at the time of checking-out and entered in the books on the
same date. The lodge decided to issue her the invoice on the same date when the amount would get credited in
its bank account.
The lodging of hotel rooms which was exempted upto ₹ 1,000 earlier became chargeable to tax from 18th
July, 20XX.
Under the GST law, determine the time of supply and taxability of the service of lodging in the hands of
'Welcome Tourist Lodge' if the cheque gets credited into the bank account of 'Welcome Tourist Lodge' on
20th of July 20XX.
Note: Assume that all the days covered in the above case are working days. [CA Final Nov 23 Exam] [CA
Final MTP Sep 24]
Answer: Legal Provision:
Ü As per explanation to section 14 of CGST Act 2017, in case of change in rate of tax, the date of receipt of
payment is the earlie r of the:
- date on which the payment is entered in the books of account of the supplier or
- date on which the payment is credited to his bank account.
Ü However, the date of receipt of payment is the date of credit in the bank account if such credit in the bank
account is after 4 working days from the date of change in the rate of tax.
Ü As per section 14(a)(iii) of CGST Act 2017, if the service is supplied before the change in rate of tax and the
invoice is issued after the change in rate of tax but the payment is received before such change in rate of tax, the
time of supply will be date of receipt of payment.
Discussion & Conclusion:
Ü In given case, Date of receipt of payment is 17th July 20XX (ie earlier of 17th July or 20th July) & Date of
issue of invoice is 20th July 20XX (since lodge decided to issue invoice on date of credit of payment in its bank
account.)

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