GST on Advance

[Kaustubh Karandikar]

Advance received from the customer which includes value + GST in the month of August’21 and goods supplied against the same in the month of October’21. Is the supplier required to pay interest since the goods not supplied in the same month? In my view yes, since the advance received is with GST and goods not supplied in the same month. Views of the experts please.

AI Summary

Debate on GST for Advance Payments: Is Interest Due if Goods Supplied Later? Notification No. 66/2017 and Section 76 Examined. A discussion on a forum revolves around the Goods and Services Tax (GST) implications on advance payments for goods. The main query is whether interest is payable if goods are supplied in a different month than when the advance, inclusive of GST, was received. Most contributors agree that GST should be paid when the advance is received, and retaining government revenue without paying interest is not permissible. Notification No. 66/2017 is discussed, with differing views on its applicability. Some argue it allows postponement of GST payment until the supply, while others emphasize compliance with Section 76 of the CGST Act.