ELIGILIBILITY OF ITC WHEN SUPPLIER FILED GSTR-1 BUT NOT FILED 3B

[Kailash Garg]

One of our supplier supplied goods and collected GST. The all payments are made through bank he filed GSTR-1 but neither deposited tax nor filed GSTR-3B Transaction is reflecting in our 2A .

The GST number cancelled by department as non filer of returns.

Now what is way to allow ITC to us

please explain

[KASTURI SETHI]

What is the date of cancellation of registration ?

First of all, Govt. dues (tax, interest, late fee, penalty) are to be paid. In case the supplier has crossed the time period for filing appeal, even then Govt. dues have to be paid.

[Altamush Zafar]

AS per law section 16(2), tax has to be actually paid by the supplier for the ITC to be claimed by the recipient. Since the supplier hasn't paid the tax ITC will not be available to you and is liable to be reversed if already taken.

[Shilpi Jain]

Ensuring that the the supplier has actually paid tax to the government is an impossible condition for the supplier to be fulfilled and can be taken as a condition not required to be fulfilled in order to avail the input tax credit.

[Shilpi Jain]

Also have a look at the below article

https://www.taxtmi.com/article/detailed?id=9746

AI Summary

Claiming ITC: Challenges When Supplier Files GSTR-1 but Not GSTR-3B; Implications Under Section 16(2) Discussed A discussion on a forum addresses the issue of claiming Input Tax Credit (ITC) when a supplier has filed GSTR-1 but not GSTR-3B, and the supplier's GST registration has been canceled due to non-filing. One participant suggests that government dues must be paid, and if the appeal period has lapsed, these dues remain payable. Another highlights that under section 16(2) of the law, ITC cannot be claimed unless the supplier has paid the tax, implying ITC should be reversed if already claimed. A third participant argues that verifying the supplier's tax payment is an impractical condition for claiming ITC.