GST Rates on Old Invoices: Section 14, Historical Notifications & Credit Notes

Summary: Determining the correct GST rate for an earlier transaction requires examining the classification of goods or services, the rate notification applicable on the relevant date and the statutory time-of-supply provisions. Historical invoices cannot be tested against current GST schedules because rates, exemptions and notification entries have changed repeatedly since 1 July 2017, including the GST 2.0 restructuring effective 22 September 2025 and subsequent changes from 1 November 2026. This article explains a three-step method for identifying the applicable historical rate using HSN or SAC classification, the relevant Central Tax (Rate) notification and amendments effective on the transaction date. It illustrates changes in the GST rates for condensed milk, cement and specified petroleum exploration support services. Particular attention is given to Section 14 of the CGST Act, 2017, which determines the time of supply where the supply, invoice and payment occur on different sides of a rate change. All six statutory scenarios are explained through dated examples, together with the special proviso that treats bank credit occurring more than four working days after the rate change as the date of payment receipt. The article also discusses Notification No. 66/2017-Central Tax governing advances received for goods, the appropriate rate for GST credit notes against earlier invoices, the Section 34 reporting deadline for FY 2025-26, and historical-rate verification during audits. Practical checklists help businesses maintain date-specific notification references, record payment and bank-credit dates accurately, update accounting systems and avoid incorrectly applying current tax rates to earlier supplies.

How to Find the GST Rate on a Past Date: Section 14, Rate Changes and Credit Notes

An auditor testing a 2019 invoice, a supplier issuing a credit note against an August 2025 sale, and a business whose order straddles a rate change all face the same question: which GST rate was in force on that date? By the author’s count of CBIC rate notifications, GST rates have changed on 32 dates since 1 July 2017, most recently on 22 September 2025 (GST 2.0) and 1 November 2026. Today’s rate list is the wrong tool for any of these cases. This article sets out how to find the rate on a past date, how section 14 of the CGST Act decides the rate when the supply, the invoice and the payment fall on different sides of a change, how the bank-credit proviso can reverse the answer, and what this means for credit notes.

1. The Rate on a Past Date, in Three Steps

• Classify the supply. Find the HSN code for goods or the SAC code for services. The rate follows the code and the description in the rate entry.
• Take the notification that was in force on that date. For goods, GST 2.0 replaced the 2017 schedules; for services, the 2017 notifications continue, amended.
• Read the entry as it stood on that date. Apply only the amendments in force by then, with their conditions and explanations.

The Integrated Tax and Union Territory Tax notifications mirror these.

Two details cause most errors at step 3.

• The effective date is not the issue date. Notification 9/2025-CT(R) is dated 17 September 2025 but took effect on 22 September 2025.
• Entry numbers did not carry over. Cement was 28% under Schedule IV, S. No. 18 of 1/2017-CT(R). It is 18% under Schedule II, S. No. 9 of 9/2025-CT(R). Working papers should cite the entry of the period, not today’s.

Example: One Product, Three Rates

Condensed milk (tariff items 0402 91 10 and 0402 99 20):

An invoice of 10 November 2017 at 18% and an invoice of 20 November 2017 at 12% are both correct. An audit that tests both against today’s 5% would report two errors that do not exist.

2. When the Rate Changes Mid-Transaction: Section 14

When a rate changes, section 14 of the CGST Act decides the time of supply, overriding the usual rules in sections 12 and 13. It looks at three events:

• the supply itself: broadly, for goods, their removal or delivery, and for services, their provision;
• the issue of the invoice;
• the receipt of payment.

The six cases in the section come down to one rule: the rate on the side of the change date where two of the three events fall. Section 20 of the IGST Act applies the same provisions to inter-State supplies.

The examples below use two changes made on 22 September 2025:

• cement, from 28% to 18%;
• support services to exploration, mining or drilling of petroleum crude or natural gas (heading 9986), entry 24(ii) of 11/2017-CT(R): 12% from 1 October 2019 (as substituted by 20/2019-CT(R)) to 21 September 2025, and 18% from 22 September 2025 (15/2025-CT(R)).

All dates are in 2025.

Points to note:

• Rows (a)(i) and (a)(iii) arise mostly with services. For goods, the invoice is due before or at the time of removal (section 31(1)). For services, rule 47 allows the invoice up to 30 days after the supply, or 45 days for banks, insurers and NBFCs.
• Row (b)(iii): no GST was payable on the advance itself, because it was for goods (Notification 66/2017-Central Tax). Section 14 also points to the invoice date.
• Row (a)(ii) is the most common case after a rate cut. A buyer who pays after the change cannot ask for the lower rate when the supply and the invoice were both before it.
• Where all three events fall on one side of the change, section 14 is not needed: the rate of that side applies.

3. When Was the Payment Received? The Bank-Credit Proviso

Section 14 gives “date of receipt of payment” its own meaning: the date the payment is entered in the supplier’s books or credited to its bank account, whichever is earlier. A proviso then overrides this. If the bank credit comes more than four working days after the date of the change, the date of credit is the date of receipt.

The proviso catches cheques and slow transfers that were recorded before a change but cleared after it. It can reverse the result.

Example.

• A cement dealer invoices a builder at 28% on Friday 19 September 2025, and records the builder’s cheque in its books the same day.
• The cement is delivered on 24 September.
• The cheque is credited to the dealer’s bank account on Monday 6 October 2025.
• On the books date alone: the invoice and the payment are both before 22 September and the supply is after it. That is section 14(b)(ii): time of supply 19 September, rate 28%.
• With the proviso: the credit on 6 October is more than four working days after 22 September, so the payment counts as received on 6 October. Now only the invoice is before the change. That is section 14(b)(i): time of supply 6 October, rate 18%. The dealer issues a credit note under section 34(1) for the excess tax charged on the 19 September invoice.

The Act does not define “working days”. Where a credit lands close to the fourth working day, check the bank holidays in between, and keep the bank statement with the invoice.

4. Credit Notes, Amendments and Audits

• A credit note carries the rate of the invoice it adjusts. It reduces the tax charged on the original invoice. Cement invoiced on 5 September 2025 at 28% and returned on 3 October 2025 needs a credit note at 28%, not 18%.
• The deadline for 2025-26 supplies is close. A credit note for a supply made in 2025-26 must be declared in a return filed by 30 November 2026, or by the date of filing the 2025-26 annual return if that is earlier (section 34(2)).
• A GSTR-1 amendment corrects the original entry, so it uses the rate in force at the original time of supply.
• Audits and departmental queries for 2017-18 to 2025-26 should test each invoice against the entry in force on its date (part 1), not against the current schedules.

5. Common Mistakes

• Testing old invoices against today’s rate list.
• Treating a notification’s date of issue as its effective date.
• Charging the new rate because the payment came after the change, when the supply and the invoice were both before it.
• Taking the books date of a cheque and ignoring the four-working-day proviso.
• Quoting a 1/2017-CT(R) entry number against 9/2025-CT(R), or the reverse.
• Issuing credit notes for old invoices at the new rate.

6. Before the Next Rate Change: A Checklist

• On the effective date, list open orders, advances received, and invoices raised but not yet paid.
• Decide the rate for each under section 14, and tell the customer before invoicing.
• Change the item master on the effective date, not on the date of the notification.
• For every transaction near the date, record:
  • the dispatch or completion date;
  • the invoice date;
  • for each payment, both the date it was entered in the books and the date it was credited to the bank.
• Bank cheques received just before the change without delay. A credit more than four working days after the change moves the payment date.
• After the change, check that credit notes against old invoices carry the old rate.

Sources

Central Goods and Services Tax Act, 2017: sections 12, 13, 14, 31(1) and 34. CGST Rules, 2017: rule 47. Integrated Goods and Services Tax Act, 2017: section 20.

Notifications 1/2017, 2/2017, 11/2017, 12/2017, 41/2017, 9/2025, 10/2025, 15/2025 and 16/2025-Central Tax (Rate), and 66/2017-Central Tax, at taxinformation.cbic.gov.in. [Texts checked on: DATE, to be filled in before submission.]

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This article is for information only. For a live case, read section 14 and the notification entry, and take advice.

Author: Subramani S, ARISHIMETO Technologies Private Limited (BooksOn), Chennai. The author’s company publishes BooksOn HSN, a free reference app. It shows the GST rate of any HSN or SAC code on any date since 1 July 2017, with the notification and entry behind it. The dates on which GST rates changed since 2017 are listed at www.bookson.co.in/gst-rate-on-past-date.