Section 12 of CGST Act - Time of Supply of Goods

Section 12 of the Central Goods and Services Tax Act, 2017 determines when the liability to pay GST on a supply of goods arises. It covers the general rule, reverse charge supplies, vouchers, residual cases and additions such as interest, late fee or penalty for delayed payment.

Updated: 15 September 2026

Practical rule for most taxable goods: although Section 12(2) contains both invoice and payment limbs, Notification No. 66/2017-Central Tax dated 15 November 2017 exempts registered persons from paying tax on advances received for supplies of goods. Accordingly, for ordinary forward-charge supplies of goods covered by that notification, GST is generally payable with reference to the invoice / required invoice date rather than merely on receipt of an advance.

What does "time of supply" mean?

The "time of supply" is the point at which liability to pay GST arises. Section 12 applies to goods. For services, see Section 13 - Time of supply of services. If the tax rate changes, Section 14 contains special rules that override the normal time-of-supply rules to the extent applicable.

Section 12 - Statutory provisions explained

Section 12(1) - Liability arises at the time of supply

The liability to pay tax on goods arises at the time of supply, determined in accordance with Section 12.

Section 12(2) - General rule for supply of goods

The time of supply of goods is the earlier of:

the date of issue of invoice by the supplier or the last date on which the supplier is required under Section 31 to issue the invoice for the supply; or
the date on which the supplier receives payment for the supply.

If a supplier of taxable goods receives up to Rs. 1,000 in excess of the amount shown in the tax invoice, the supplier may, for that excess amount, choose the date of issue of the invoice as the time of supply.

Explanation 1: supply is deemed to have been made to the extent covered by the invoice or payment, as the case may be.

Explanation 2: the date on which payment is received is the earlier of the date it is entered in the supplier's books of account and the date it is credited to the supplier's bank account.

Important amendment: the words "sub-section (1) of" before Section 31 were omitted by the Central Goods and Services Tax (Amendment) Act, 2018 with effect from 1 February 2019. The current provision therefore refers to the last date on which the invoice is required to be issued under Section 31.

Advance received for supply of goods

Notification No. 66/2017-Central Tax dated 15 November 2017 provides relief from payment of central tax at the time of receipt of advance consideration for supply of goods to the registered persons covered by the notification. This is an important practical qualification when reading the payment limb in Section 12(2). The corresponding tax liability for such goods is generally accounted for when the invoice is issued or becomes due under Section 31.

Section 12(3) - Goods under reverse charge

Where tax on the supply is paid or liable to be paid on reverse charge basis, the time of supply is the earliest of:

the date of receipt of goods;
the date of payment entered in the recipient's books of account or the date on which payment is debited from the recipient's bank account, whichever is earlier; or
the date immediately following 30 days from the date of issue of the supplier's invoice or other document issued in its place.

If the time of supply cannot be determined under those rules, it is the date of entry of the supply in the recipient's books of account.

Section 12(4) - Vouchers

For supply of vouchers, the time of supply is the date of issue of the voucher if the underlying supply is identifiable at that point. In all other cases, it is the date on which the voucher is redeemed.

Section 12(5) - Residual rule

If the time of supply cannot be determined under Section 12(2), 12(3) or 12(4), it is:

the date on which the periodical return is required to be filed, where such a return has to be filed; or
in any other case, the date on which the tax is paid.

Section 12(6) - Interest, late fee or penalty for delayed consideration

Where the value of a supply increases because of interest, late fee or penalty for delayed payment of consideration, the time of supply for that additional amount is the date on which the supplier receives it.

Section 12 at a glance

Situation	Time of supply
Normal supply of goods	Earlier of invoice / required invoice date and receipt of payment, subject to the advance-payment relief applicable to supplies of goods under Notification No. 66/2017-Central Tax.
Reverse charge - goods	Earliest of receipt of goods, prescribed payment date, or the date immediately following 30 days from supplier's invoice / equivalent document.
Voucher - supply identifiable on issue	Date of issue of voucher.
Voucher - supply not identifiable on issue	Date of redemption.
Residual case	Return due date, or if not applicable, date tax is paid.
Interest / late fee / penalty for delayed consideration	Date the additional amount is received by the supplier.

Related CGST provisions

Section 12 should be read with Section 7 - Scope of supply, Section 9 - Levy and collection, Section 13 - Time of supply of services, Section 14 - Change in rate of tax, Section 15 - Value of taxable supply and Section 31 - Tax invoice.