27 Jun CBIC Circular No. 221/15/2024-GST: Time of Supply Rules for NHAI HAM Projects
CBIC has issued Circular No. 221/15/2024-GST dated June 26, 2024, clarifying the time of supply rules applicable to services related to the construction and maintenance of National Highway Projects under the Hybrid Annuity Mode (HAM) model by the National Highways Authority of India (NHAI).
The Circular addresses concerns regarding the determination of the time of supply for these services, particularly where payments are staggered over the contract period. Key clarifications provided include:
- Nature of HAM Contracts: HAM contracts encompass both construction and operation/maintenance of highways, treated holistically rather than as separate contracts.
- Time of Supply Determination: For continuous supply of services under HAM contracts, including construction and operation/maintenance phases:
- The time of supply is determined as the earlier of the date of invoice issuance or receipt of payment, provided the invoice is issued on or before the specified date or completion of the contract event.
- If the invoice is not issued timely, the time of supply will be the date of service provision or receipt of payment, whichever is earlier.
- Taxable Value Considerations: The taxable value for tax purposes includes not only the principal amount but also any interest component in the annuity/installment payments made by NHAI to the concessionaire.
The Circular aims to ensure consistent application of GST provisions across field formations and recommends dissemination through trade notices for compliance.
For detailed information, refer to the Circular here
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