GST not deposited by Supplier ?

By | August 24, 2018
(Last Updated On: August 24, 2018)

Supplier not deposited GST

Question from Sushil Paliwal : I am working in Mining Business registered firm. If we purchased old truck for mining work against GST tax invoice in March 18 from registered supplier and we availed all ITC in March 18 but supplier not deposited GST tax and related GST return what provision apply of GST ACT or rules in this condition.
Answer : In  the above case
  • The Supplier GST Registration can be cancelled by GST Officer and
  • Recipient will not be entitled to claim Input Tax Credit . Thus he is required to reverse Input Tax credit along with interest .
Relevant Provisions of CGST act are as follow :-
Cancellation of GST Registration 
Section – 29, Central Goods And Services Tax Act, 2017:-
(2) The proper officer may cancel the registration of a person from such date, including any retrospective date, as he may deem fit, where
(b)a person paying tax under section 10 [Composition scheme] has not furnished returns for three consecutive tax periods; or
(c)any registered person, other than a person specified in clause (b), has not furnished returns for a continuous period of six months; or


Eligibility and condition for taking input tax credit.

Section – 16, Central Goods And Services Tax Act, 2017


(2) Notwithstanding anything contained in this section, no registered person shall be entitled to the credit of any input tax in respect of any supply of goods or services or both to him unless,—


(c)subject to the provisions of section 41, the tax charged in respect of such supply has been actually paid to the Government, either in cash or through utilisation of input tax credit admissible in respect of the said supply; and

Section – 42, Central Goods And Services Tax Act, 2017

Matching, reversal and reclaim of input tax credit.

(3) Where the input tax credit claimed by a recipient in respect of an inward supply is in excess of the tax declared by the supplier for the same supply or the outward supply is not declared by the supplier in his valid returns, the discrepancy shall be communicated to both such persons in such manner as may be prescribed.


(5) The amount in respect of which any discrepancy is communicated under sub-section (3) and which is not rectified by the supplier in his valid return for the month in which discrepancy is communicated shall be added to the output tax liability of the recipient, in such manner as may be prescribed, in his return for the month succeeding the month in which the discrepancy is communicated…..

(8) A recipient in whose output tax liability any amount has been added under sub-section (5) or sub-section (6), shall be liable to pay interest at the rate specified under sub-section (1) of section 50 on the amount so added from the date of availing of credit till the corresponding additions are made under the said sub-sections.


How to Check your Supplier is Regular in Filing GST Return

Visit and Go to Search Taxpayer :  Click by  GSTN and enter GSTIN number to get the return filing status of suplplier






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