Dear Experts,
Our supplier has filed GSTR-1, and the details are reflected in our GSTR-2A/2B. Based on this, we have claimed Input Tax Credit (ITC) and have also paid the tax to the supplier. However, the supplier’s GSTR-3B was filed with nil value. As a result, the GST Department has issued us a notice to pay back the claimed ITC.
Currently, the supplier is not responding and appears to have no ongoing business transactions.
Questions
Since we have already paid the tax to the supplier, does this mean we are being forced to pay the tax twice — once to the supplier and again to the GST department?
How should we handle this situation to avoid double payment?
Is there any official way to protect the recipient’s interest and confirm the supplier’s tax filings?
Taxpayer faces ITC reversal demand despite supplier filing GSTR-1 and appearing in GSTR-2A after supplier files nil GSTR-3B A GST taxpayer claimed Input Tax Credit after their supplier filed GSTR-1 and details appeared in GSTR-2A/2B, with tax paid to the supplier. However, the supplier filed GSTR-3B with nil value, prompting the GST Department to demand ITC reversal. The taxpayer faces potential double taxation concerns as the supplier is unresponsive. Legal experts cited various High Court judgments supporting the buyer's position, arguing recipients cannot be held responsible for supplier defaults. One expert referenced Rule 37A, stating recipients need only ensure GSTR-3B filing, not its accuracy. However, another expert noted authorities increasingly enforce Section 16(2)(c) compliance requirements, making ITC recovery challenging for honest taxpayers when suppliers fail to remit collected taxes. (AI Summary)
TaxTMI 
TaxTMI 
