Before supplying on credit, confirm the buyer's GSTIN is Active and the name matches the order (a buyer registered in Gujarat has a GSTIN starting 24), read the GST filing record, and check court cases and defaults reported by other suppliers. For chemical and dye buyers, also check that the buyer's nature of business fits what it is ordering. FundRaksha Trust runs the GST check free and the full buyer report in one place.
How credit works in Ahmedabad's industrial estates
In Narol and Vatva, dye, pigment and chemical intermediates makers sell to textile processors and to traders who resell across Gujarat, Maharashtra and the north. Processors in turn work for fabric traders on job-work terms. In Naroda and the pharma belt, API and formulation units sell to distributors and to contract manufacturers. Credit periods are long, and in practice dues often stretch well past the agreed date.
Construction and real estate add a different kind of buyer: contractors who buy cement, steel, fabrication and electrical work, and pay when their own bills are cleared.
Credit risks typical of Ahmedabad's trades
- Processors under stress: a textile processor that loses orders cuts payments to its dye and chemical suppliers first.
- Traders reselling chemicals to buyers you never see, with no stake in your invoice beyond their margin.
- Pharma distributors carrying expiry returns and claims they set off against your dues.
- Contractors paying on back-to-back terms, only after the builder pays them.
- Price disputes when raw material prices move between order and delivery.
Checks to run on a buyer
- Validate the GSTIN with the GSTIN validator. A Gujarat registration starts with 24; a different prefix means the buyer is registered in another state, which is fine if it matches the billing address on the order.
- Run the [free Trust check](https://www.trust.fundraksha.com/gst-lookup): status Active, legal and trade name matching the purchase order, registration date and constitution.
- Read the filing record in the Advance GST report (129 RP), which also shows registered contacts, associated people and places, and defaults reported by other suppliers.
- For a larger order, the GST + Financial report (499 RP) adds court cases, tribunals and FIRs and the owner's credit score and loan record, fetched with the owner's consent, and ends in a give-credit, caution or avoid decision.
A "trader" GSTIN ordering industrial quantities of a regulated chemical, or a newly registered firm ordering pharma APIs, is a reason to ask more questions before shipping.
Worked example: a Vatva dyes maker and a processor in Pali
A Vatva reactive-dyes maker is asked for ₹6,20,000 of material on 60 days by a processor in Pali. The GSTIN starts 08 (Rajasthan), is Active and has filed regularly, but the GST + Financial report shows two recovery suits by chemical suppliers in the past year and a recent delay on the owner's business loan. The decision is "give credit with care". The dyes maker supplies ₹2,00,000 on 30 days and the balance against payment on delivery.
If a buyer stops paying
Act early. Start with a payment follow-up, then a legal notice by email and WhatsApp or by registered post with proof of delivery. For a bounced cheque, the Section 138 notice must go within 30 days of the return memo.
A micro or small supplier with Udyam registration located in Gujarat can file on MSME Samadhaan before the Gujarat Micro and Small Enterprises Facilitation Council (Industries Commissionerate, Government of Gujarat, Gandhinagar) once the buyer is past the agreed period, which the MSMED Act caps at 45 days. Interest runs at three times the RBI bank rate, compounded monthly. Gujarat suppliers can have claims against out-of-state buyers heard by the Council in Gujarat.
Report the defaulter so other suppliers are warned, and for recovery help in the city see FundRaksha Ahmedabad.
Sources
Last reviewed: 2026-10-21. Information for Indian businesses; not legal advice.