The Government of Rajasthan on July 9th 2024, issued a clarification on the time of supply of services of spectrum usage and other similar services under GST.
The Clarifications Include the Following:
- GST shall be payable when the upfront payment is due or made for full upfront payments, and when payments are due or made for deferred payments in installments by telecom operators.
- The time of supply of services under reverse charge shall be the date of payment recorded in the recipients books or debited in the bank account, whichever is earlier, or the date immediately following 60 days from invoice issuance by the supplier – section 13(3) CGST Act 2017.
- The similar time of supply rules shall apply to the allocation of natural resources by the government for the right to use, constituting continuous supply under the CGST Act, with upfront or deferred payments
This clarification is regarding the time of supply for GST payment in the case of spectrum allocation services where the telecom operator opts for deferred payment in installments as per the Frequency Assignment Letter (FAL) issued by the Department of Telecommunications (DoT), Government of India, addressing the timing at which GST liability arises.
Typically, GST becomes payable at the time of issuance of the invoice or receipt of payment, whichever is earlier. In cases of deferred payment, GST liability may be triggered based on the terms outlined in the FAL or the actual receipt of payments, depending on the specific arrangements and the GST rules applicable at that time
