Yo im pretty sure u use soul lantern to capture monsters yeah so I'm  looking for one but I cant seem to find it.

I did manage to find one in one of the earlier versions way before from some random woman (i think) but i forgot where that place was or how i acquired it

And also here's the thing; even if i did have the lantern back then i still couldn't capture the monsters, like it kept on being a failure to capture them, so I wanna ask whether it's a bug or there are some specific things am missing out on before using it?

you need to make the lantern in blacksmith then to capture the monster, the monster need to be in a low health. hope you understand it. sorry for my broken english

The npc Meilira in Whisperwind Farm in Begus gives you the quest about capturing monstergirls. Only after her dialog can you craft Soul Lanterns at an alchemy table, for example in the blacksmith of Aldlyn.
As Hafiz pointed out, the chance to capture the monstergirl increases with lower HP.