Regarding gst return not filled by vendors

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This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

30 November 2018 Respected Seniors,
Please advise what action we can take against our vendors who has not filed their gst returns for 2017-18 in spite of regular reminders.
We have some vendors who has not filled their GST returns for 2017-18 due to non filing of returns their invoices has not reflect in our GST portal. We have also paid full payment to vendors.

Querist : Anonymous

Querist : Anonymous (Querist)

04 December 2018 Dear Seniors,
Please advise what action we should take against defaulter vendors who has not filled GST return for 2017-18.

Aashok Kumar Sharma

Aashok Kumar Sharma

(Expert)

10 July 2024 Dealing with vendors who have not filed their GST returns for 2017-18 despite regular reminders can be challenging, especially since it impacts your ability to claim Input Tax Credit (ITC) and potentially leads to compliance issues. Here are steps you can take to address this situation:

### 1. **Communication and Documentation:**
- **Send Formal Notices:** Send formal communication to the vendors requesting them to file their GST returns for the relevant period (2017-18). Clearly outline the consequences of non-compliance, such as your inability to claim ITC.
- **Maintain Records:** Keep records of all communications including emails, letters, and any responses received from the vendors.

### 2. **Verification and Follow-Up:**
- **Verify Status:** Check the GST portal periodically to see if the vendors have filed their pending returns. Sometimes delays can occur due to technical issues or other reasons.
- **Follow-Up:** If the vendors do not respond or do not file their returns, follow up with them through phone calls or meetings to understand the reasons for non-compliance.

### 3. **Alternative Actions:**
- **Withhold Payments:** Consider withholding further payments to the vendors until they rectify their compliance issues. However, this should be done cautiously and in compliance with contractual agreements.
- **Legal Options:** If the vendors persistently fail to comply despite repeated notices and reminders, consider seeking legal advice on your options. This may include legal action to recover any tax credits or payments affected by their non-compliance.

### 4. **Collaboration with GST Authorities:**
- **Approach GST Authorities:** If necessary, approach the GST department with evidence of non-compliance by the vendors. They may be able to provide guidance or take enforcement actions against the vendors.

### 5. **Review Internal Procedures:**
- **Vendor Selection:** Review your vendor selection process to ensure future vendors have a good compliance track record.
- **Contractual Agreements:** Include clauses in future contracts requiring vendors to maintain GST compliance and timely filing of returns.

### Important Considerations:
- Ensure that all actions taken are within the legal framework and do not violate any contractual agreements.
- Seek professional advice from a tax consultant or legal expert if the situation escalates or if you are unsure about the appropriate course of action.

By taking proactive steps to address non-compliance issues with your vendors, you can mitigate potential risks to your own GST compliance and financial operations.

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