Paid Advance but Goods Not Delivered? What to Do

Paid advance but goods not delivered: what is the first step?

The first step is to collect your proof. Courts and Consumer Commissions decide cases on documents, not on memory. Phone calls that nobody recorded are hard to prove later.

Start collecting everything that shows the deal, the payment and the promise. Save the originals and keep a second copy on your email or cloud drive.

• Quotation or proforma invoice given by the supplier
• Tax invoice or advance receipt, if any was issued
• Proof of payment: bank statement entry, UPI record, cheque copy or card slip
• WhatsApp chats, emails and SMS where the delivery date or price was confirmed
• Details of the supplier: name, address, GST number if available, and any shop or website details
• A short note of dates: when you ordered, when you paid, when delivery was due and when you last spoke

How do you send a legal notice for refund or delivery?

Once your records are ready, send a written notice. A notice shows that you have given the supplier a fair chance to fix the problem. It also becomes useful evidence if the matter goes further.

Keep the notice factual and calm. Send it by a trackable method such as registered post or speed post, and also by email or WhatsApp to the known address. Keep the postal receipt and delivery status.

A good notice normally states:

• What you ordered and the agreed price
• How much you paid, on which date and by which mode
• The promised delivery date and the fact that it was missed
• A clear final date by which the supplier must deliver or refund the amount
• A statement that you may take legal action if there is no response
• Whether you also claim interest or compensation, if that is justified on your facts

Can you file a consumer complaint for non-delivery?

If the supplier still does not respond, a complaint before the Consumer Commission under the Consumer Protection Act, 2019 may be an option. Taking money and not delivering goods or services can, depending on the facts, be argued as a deficiency in service or an unfair trade practice.

The big question is whether you are a consumer under the Act. The law excludes a person who buys goods for resale or for a commercial purpose. At the same time, goods used only to earn your own livelihood by self-employment are treated differently. So a shop owner buying furniture may or may not qualify, depending on the purpose and the facts of the case. Get this checked before you file.

There is also a time limit. Under the Act, a complaint should generally be filed within two years from the date the cause of action arose, and a delay is condoned only if you give sufficient reasons. Do not wait for years.

Complaints can usually be filed online as well as in person. The Commission that can hear your case depends on the value of what you paid, so a claim of this size would normally go to the District Commission.

What other options do you have if the supplier disappears?

A consumer complaint is not the only route. The right choice depends on how you paid, how big the amount is and whether you think the supplier never meant to deliver.

Here are the other options that may be considered:

• Bank or payment dispute: if you paid by card or through a payment app, raise a complaint with your bank or the platform quickly, as dispute windows can be short.
• Civil recovery suit: a business buyer who does not qualify as a consumer can file a civil suit to recover the money. Civil claims have their own time limits, so take advice early.
• Criminal complaint: if the supplier took money with a dishonest intention from the start, a complaint for cheating under the Bharatiya Nyaya Sanhita may be possible. A simple delay or breach of contract is not automatically cheating, so this needs careful review of the facts.
• Online platform complaint: if you bought through a marketplace or website, complain to the platform and keep the complaint number.
• Negotiated settlement: after a notice, some suppliers agree to refund in instalments. Get any such promise in writing.

What should a business buyer record in the books?

If you bought the furniture for your business, the advance should be shown properly in your accounts as an advance paid to a supplier, not as an expense. Keep the supplier ledger updated until the goods arrive or the money comes back.

Input tax credit on GST is generally linked to receiving the goods and a valid tax invoice, so do not claim it casually on an undelivered order. Your CA can check how your advance and any GST document should be treated. If the amount is finally unrecoverable, the tax treatment of the loss also depends on the facts, so take professional advice before writing it off.

To avoid this problem next time, try these habits:

• Pay a smaller advance and link the balance to delivery
• Insist on a written order with a delivery date and a refund clause
• Check the supplier's address, GST registration and reviews before paying
• Pay through traceable banking channels, not cash
• Follow up in writing, not only on calls

Frequently asked questions