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Mr. P, an event manager, completes a wedding event on 20 February 2024. He issues invoice on 28 February 2024. He receives Rs 1 lakh advance on 1 January 2024 and balance Rs 3 lakh on 5 March 2024. Time of supply for the Rs 1 lakh advance is:
A20 February 2024
B1 January 2024
C28 February 2024
D5 March 2024
Answer & Solution
Correct answer: B. 1 January 2024
1. Sec 13(2)(a) applies (invoice issued within 30 days of supply of service = 20 Feb→28 Feb).
2. Time of supply = earlier of date of invoice (28 Feb) or date of receipt of payment.
3. The Rs 1 lakh advance was received on 1 Jan 2024, hence its time of supply is 1 Jan 2024 (services advances ARE taxable, unlike goods).
_Source: ICAI BoS CA Final Paper 8, Ch 4 "Time of Supply", §Sec 13(2)(a)_
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