JHARKHAND VALUE ADDED TAX BILL,2005

 

A Bill to replace the law relating to the levy of tax on the sale or purchase of goods in the State of jharkhand

 

BE it enacted by the Legislative Assembly of the State of Tamil Nadu in the Fifty‑sixth Year of the Republic of India as follows:

                       

PRELIMINARY

 

1.         Short title, extent and commencement

 

(1)        This Act may be called the jharkhand Value Added Tax Bill, 2005.

 

(2)        It extends to the whole of the State of Jharkhand

 

(3)        It shall come into force on such date as the Government may by notification in the Official Gazette, appoint and different dates may be appointed for bringing into force different sections of this Act.

 

2.         Definitions

 

In this Act unless the context otherwise requires,

 

(i)         "Act" means the jharkhand Value Added Tax Act, 2005;

 

(ii)        "assessee" means any person by whom tax or any other sum of money is payable under this Act and includes every person in respect of whom any proceedings under this Act have been taken for the assessment of tax payable by him;

 

(iii)       "Assessing Authority" means any person not below the rank of a Commercial Taxes Officer authorized by the Government to make any assessment under this Act;

 

(iv)       "Assistant Commissioner" means any person appointed to be an Assistant Commissioner of Commercial Taxes under this Act;

 

(v)        "Business" includes­

 

(a)        any trade, commerce, manufacture or any adventure or concern in the nature of trade, commerce, manufacture, whether or not such trade, commerce, manufacture, adventure, concern is carried on with a motive to make gain or profit and whether or not any profit accrues from such trade, commerce, manufacture, adventure, concern; and

(b)        any transaction in connection with, or incidental or ancillary to, such trade, commerce, manufacture, adventure or concern;

 

(vi)       "Commissioner" means the Commissioner of Commercial Taxes or Additional Commissioner of Commercial Taxes appointed by the Government under this Act and includes any other officer upon whom the State Government may by notification, confer all or any of the powers and duties of the Commissioner under this Act;

 

(vii)      "capital goods" means plant, machinery and equipment used in the process of manufacturing excluding goods mentioned in negative list as in Appendix ‑ 1;

 

(viii)      "Commercial Tax Officer" means any person appointed to be a Commercial Tax Officer under this Act;

 

(ix)       "casual trader" means a person who whether as principal, agent or in any other capacity, has occasional transactions involving buying, selling, supplying or distributing goods or conducting any exhibition cum sale in the State, whether for cash or for deferred payment, or for commission, remuneration, or other valuable consideration;

 

(x)        "dealer" means any person who carries on the business of buying, selling, supplying or distributing goods, executing works contract, delivering any goods on hire‑purchase or any system of payment by installments; transferring the right to use any goods or ‑ supplying by way of or as part of any service, any goods directly or otherwise, whether for cash or for deferred payment, or for commission, remuneration or other valuable consideration and includes;

 

(a)        a casual trader;

(b)        a commission agent, a broker or a del cruder agent or an auctioneer or any other mercantile agent, by whatever name called;

(c)        a non‑resident dealer or an agent of a non‑resident dealer, or a local: branch of a firm or company or association or body of persons whether incorporated or not, situated outside the State;

(d)        a person who, whether in the course of business or not,­

(i)         sells goods produced by him by manufacture, agriculture, horticulture or otherwise; or

(ii)        transfers any goods, including controlled goods whether in pursuance of a contract or not, for cash or for deferred payment or for other valuable consideration; or

(iii)       supplies, by way of or as part of any service or in any other manner whatsoever, goods, being food or any other articles for human consumption or any drink (whether or not intoxicating), where such supply or service is for cash, deferred payment or other valuable consideration;

 

(xi)       "declared goods" means goods declared to be of special importance in inter‑State trade or commerce under section 14 of the Central Sales Tax Act, 1956 (Central Act 74 of 1956);

 

(xii)      "Deputy Commissioner" means any person appointed to be a Deputy Commissioner of Commercial Taxes under this Act;

 

(xiii)      "Entry of goods" ‑ with all its grammatical variations and cognate expressions means entry of goods mentioned in Schedule. Ill into a local area from any place outside the State;

 

(xiv)     "EOU" ‑ means Export Oriented Unit, as defined in the Central Excise Act, 1944;

 

(xv)      "EHTP" ‑ means Electronic Hardware Technology Park, as defined in the Central Excise Act 1944;

 

(xvi)     "goods" means all kinds of movable property (other than newspapers, actionable claims, electricity, stocks and shares and securities) and includes live stock, all materials, commodities and articles and every kind of property (whether as goods or in some other form) involved in the execution of a works contract, and all growing crops, grass or things attached to, or forming part of the land which are agreed to be severed before sale or under the contract of sale;

 

(xvii)     "goods carrier" shall include motor vehicle, vessel, boat, animal or any other means of conveyance but will exclude railway wagon, coach or vehicle or any road transport when plying in collaboration with rail transport and under the control of the Railway;

 

(xviii)    "Government" means Government of Jharkhand;

 

(xix)     "gross turnover" means

 

(i)         for the purposes of levy of sales tax, in respect of sale of goods, aggregate of sale prices received and receivable by a dealer, including the gross amount received or receivable for execution of works contract or for the transfer of right to use any goods for any purposes (whether or not for a specified period) during any given period (and also including the sale of goods made outside the State, in the course of inter‑State trade or commerce or export), but does not include sale prices of goods which have borne the incidence of purchase tax under section 10,

(ii)        for the purposes of levy of purchase tax, aggregate of purchase prices paid or payable by a dealer during any given period in respect of purchase of goods or class or description of goods which have borne the incidence of purchase tax under Section 10,

(iii)       for the purposes of Section 9, the aggregate of the amounts under sub‑clauses (i) and (ii);

 

(xx)      "Importer" means a dealer who brings any goods into the State, or to whom any goods are dispatched from any place outside the State;

 

(xxi)     "input tax" means the tax paid or payable under this Act by a registered dealer to another registered dealer on the purchase of goods in the course of business for resale or for the manufacture of taxable goods or for use as containers or packing material or for the execution of works contract:

 

PROVIDED FURTHER that input tax shall also include tax paid on the entry of goods into the local area as specified in Schedule III;

 

(xxii)     "Joint Commissioner" means any person appointed to be a joint Commissioner of Commercial Taxes under this Act;

 

(xxiii)    "Local Area" means the areas within the limits of a­

(a)                Municipal Corporation

(b)        Municipality

(c)        Notified Area Committee

(d)        Cantonment Board

(e)        Town Board

(f)                 Mines Board

(g)                Municipal Board

(h)                Gram Panchayat

(i)         Any other Local Authority by whatever nomenclature called, constituted or continued in any law for the time being in force;

 

(xxiv)    "manufacture" includes any activity that brings out a change in an article or articles as a result of some process, treatment, labour and results in transformation into a new and different article so understood in commercial parlance having a distinct name, character, use, but does not include such activity of manufacture as may be notified.

 

(xxv)    "month" means a calendar month;

 

(xxvi)    "notification" means a notification published in the Official Gazette of the Government;

 

(xxvii)   "output tax" means the tax charged or chargeable under this Act by a registered dealer for the sale of goods in the course of business;

 

(xxviii)   "Person" includes:­

(a)    an individual;

(b)   a joint family;

(c)    a company;

(d)   a firm;

(e)        an association of persons or a body of individuals; whether incorporated or not;

(f)         the Central Government or the Government of Jharkhand or the Government of any other State or Union Territory in India;

(g)        a local authority;

 

(xxix)    "place of business" means any place where a dealer carries on the business and includes:

(a)        any warehouse, godown or other place where a dealer stores or processes his goods;

(b)        any place where a dealer produces or manufactures goods; (c) any place where a dealer keeps his books of accounts;

(d)        in cases where a dealer carries on business through an agent (by whatever name called), the place of business of such agent;

(e)        any vehicle or vessel or any other carrier wherein the goods are stored or used for transporting the goods;

 

(xxx)    "prescribed" means prescribed by Rules made under this Act;

 

(xxxi)"Quarter" means the quarter ending on the 30th June, 30th September. 31st December and 31st March;

 

(xxxii)"registered dealer" means a dealer registered under this Act;

 

(xxxiii)"reverse tax" means that portion of input tax of the goods for which credit has been availed but such goods are used subsequently for any purpose other than resale or manufacture of taxable goods or execution of works contract or use as containers or packing materials within the State;

 

(xxxiv)"sale" with all its grammatical variations and cognate expressions means any transfer of property in goods for cash or deferred payment or other valuable consideration but does not include a mortgage or hypothecation of or a charge or pledge on goods, and includes

 

(a)        transfer of property in any goods, otherwise than in pursuance of a contract;

(b)        transfer of property in goods (whether as goods or in some other form) involved in the execution of a works contract;

(c)        delivery of goods on hire purchase or any other system of payment by instalments;

(d)        a transfer of the right to use any goods for any purpose, whether or not for specified period, for cash, deferred payment or any other valuable consideration;

(e)        supply of goods made by a society, trust, club or association, whether incorporated or not, to its members or otherwise;

(f)         supply, by way of or as part of any service or in any other manner whatsoever, of goods being food or any other drink (whether or not intoxicating),

 

and such transfer, delivery or supply of any goods shall be deemed to be a sale of those goods by the person making the transfer, delivery or supply, and all grammatical variations and cognate expressions shall be construed accordingly;

 

and 'purchase' means such acquisition of property in goods or purchase of those goods by the person to whom such transfer, delivery or supply is made.

 

Explanation I : A transfer or acquisition of goods on hire purchase or under any other system in which payment of valuable consideration is made by instalments, shall, notwithstanding the fact the seller retains the title in the goods as a security for the payment of the valuable consideration or for any other reasons, be deemed to be a sale or purchase.

 

Explanation II: Notwithstanding anything contained in any law for the time being in force, two independent purchases or sales shall, for the purpose of this part, be deemed to have taken place

 

(a)        when the goods are transferred from principal to his selling agent and from the selling agent to the purchaser, or

(b)        when the goods are transferred from the seller to a buying agent and from the buying agent to his principal, if the agent is found

(i)         to have sold the goods at one rate and to have passed on the sale price to his principal at another rate, or

(ii)        to have purchased the goods at one rate and to have passed them on to his principal at another rate, or

(iii)       not to have accounted to his principal for the entire collections or deductions made by him in the sales or purchases effected by him or on behalf of his principal, or

(iv)       to have acted for a fictitious or non‑existent principal.

 

(xxxv)   "Sale price" means the amount payable to a dealer as valuable consideration in respect of the sale or supply of goods;

 

Explanation I : 'Sale price' shall include any amount charged by the dealer for anything done in respect of the goods at the time of, or before delivery thereof to the buyer;

 

Explanation II:'Sale price'shall not include the cash discount allowed by the dealer according to the ordinary trade practice, if shown separately. It shall also not include the cost for transport of the goods from the seller to the buyer, provided such cost is separately charged to the buyer;

 

(xxxvi)"purchase price" means the amount payable by a dealer as a valuable consideration in respect of purchase of goods;

 

Explanation I: 'Purchase price' shall include any amount payable by a dealer who purchases goods for anything done by the seller in respect of the goods at the time of or before delivery thereof to the buyer.

 

Explanation II :'Purchase price' shall not include

 

(a)        the cash discount allowed by the seller according to ordinary trade practice, if shown separately;

(b)        the cost of transport of the goods from the seller to the buyer, provided such cost is separately charged to the buyer;

 

(xxxvii)"SEZ" ‑ means Special Economic Zone, as defined in the Central Excise Act 1944;

 

(xxxviii)"State" means the State of Jharkhand;

 

(xxxix)  "Start up business" means a dealer intending to setup a factory to manufacture any goods shall be deemed /treated as a "start up business" until the date of commencement of commercial production;

 

(xxxx)   "STF ‑ means Software Technology Park, as defined in the Central Excise Act, 1944;

 

(xxxi)    "tax" means the tax payable under this Act;

 

(xxxxii)"tax invoice" means a document listing goods sold with price, quantity and other details as specified in this Act and includes a statement of account, bill, cash register, slip, receipt or similar record, regardless of its form;

 

(xxxxiii)"taxable turnover" means the turnover on which a dealer shall be liable to pay tax as determined after making such deductions from his total turnover and in such manner as may be prescribed;

 

(xxxxiv)"turnover" means the aggregate amount for which goods are either bought or sold, supplied or distributed by a dealer, either directly or through another, on his own account or on account of others, whether for cash or for deferred payment or for other valuable consideration;

 

Explanation : (1)           The turnover in respect of delivery of goods on hire purchase or on any system of payment by instalments shall be the market price of the goods so delivered.

(2)        The turnover in respect of the transfer of the right to use any goods shall be the aggregate amount received or receivable by the dealer as consideration for such transfer.

(3)        Subject to such conditions and restrictions, if any, as may be prescribed in this behalf

 

(a)        the amount for which goods are sold shall include any sums charged for anything done by the dealer in respect of the goods sold at the time of, or before, the delivery thereof;

(b)        any cash discount on the price allowed in respect of any sale or any amount refunded in respect of articles returned by customers shall not be included in the turnover; and

(c)        where for accommodating a particular customer, a dealer obtains goods from another dealer and immediately disposes of the same to the said customer, the sale in respect of such goods shall be included in the turnover of the latter dealer but not in that of the former;

 

(xxxxv) 'Tribunal" means the Tribunal constituted under Section 3 of this Act;

 

(xxxxvi)"value added tax" means a tax on sales or purchases levied under this Act;

 

(xxxxvii)"vehicle" includes every wheeled conveyance used for the carriage of goods solely or in addition to passengers;

 

(xxxxviii)"vessel" includes any ship, barge, boat, raft, timber, bamboos or floating materials propelled in any manner;

 

(xxxxix)"Works Contract" means any agreement for carrying out for cash or deferred payment or other valuable consideration the construction, fitting out improvement or repair of any building, road, bridge or other immovable or movable property;

 

(xxxxx)"year" means the financial year beginning from 1st April and ending with 31st March.

 

                       

INCIDENCE AND LEVY OF TAX

 

3.         Incidence of tax

 

(1)        Subject to the provisions of this Act, every dealer,

 

(i)         whose total turnover during the year immediately preceding the appointed day exceeded rupees five lakhs and whose taxable turnover exceeded rupees ten thousand in a year (the aforesaid amounts of total turnover and taxable turnover are hereinafter referred to as "thresholds of turnover"), or

(ii)        who was registered under the earlier law or under the Central Act as on the appointed day, or

(iii)       whose total turnover and taxable turnover in any year first exceed the thresholds of turnover, or

(iv)       who is registered or liable to be registered as a dealer under this Act or under the Central Act at any time after the appointed day

 

shall be liable to pay tax in accordance with the provisions of this Act.

 

(2)        Notwithstanding anything contained in this section, a casual dealer or an auctioneer shall be liable to be registered if his taxable turnover of sales exceeds ten thousand rupees and he shall be liable to pay tax in accordance with the provisions of this Act.

 

(3)        The dealer shall be liable to pay tax,­

 

(a)        in case of clauses (i) and (ii) of sub‑section (1), with effect from the appointed day;

(b)        in case of clause (iii) of sub‑section (1), with immediate effect when his turnover calculated from the commencement of the year first exceeds the thresholds of turnover;

(c)        in case of clause (iv) of sub‑section (1), with immediate effect when he becomes so, liable or the date of registration under this Act, whichever is earlier:

 

PROVIDED that the dealer shall not be liable to pay tax in respect of thresholds of turnover as takes place during the period prior to the relevant date of effect under this sub‑section.

 

(4)        Every dealer who has become liable to pay tax under this Act shall continue to be so liable until the expiry of one year during which his total turnover and taxable turnover have remained below the thresholds of turnover and such further period after the date of such expiry as may be prescribed; and on the expiry of such further period his liability to pay tax shall cease:

 

PROVIDED that any dealer whose liability to pay tax under this Act ceases or his total turnover and taxable turnover during the year remains below the thresholds of turnover may apply for the cancellation of his certificate of registration ; and on such cancellation, his liability to pay tax shall cease and such dealer shall remain liable to pay tax till his certificate of registration is cancelled.

 

(5)        Every dealer whose liability to pay tax under this Act has ceased under sub‑section (4) or whose certificate of registration has been cancelled, shall, if his total turnover and taxable turnover calculated from the commencement of any year (including the year in which the registration has been cancelled) again exceeds the thresholds of turnover, on any day within such year, be liable to pay tax with effect from the date immediately following the day on which his such turnover again exceeds thresholds of turnover of sales effected by him after that date.

 

(6)        Where by an order passed under this Act, it is found that any person registered as a dealer ought not to have been so registered, then, notwithstanding anything contained in this Act, such person shall be liable to pay tax for the period commencing with the date of his registration and ending with the date of such order, as if he were a dealer.

 

4.         Certain sales and purchases not liable to tax

 

(1)        Nothing contained in this Act or the Rules made thereunder shall be deemed to impose or authorize the imposition of tax on any sale or purchase of any goods where such sale or purchase takes place

 

(a)        in the course of inter‑State trade or commerce; or

(b)        outside the State; or

(c)        in the course of the import of goods into or export of goods out of the territory of India,

 

and the provisions of this Act and the Rules made thereunder shall be construed accordingly.

 

Explanation : Sections 3, 4 and 5 of the Central Act shall apply for determining whether or not a particular sale or purchase has taken place in the manner indicated in clause (a), (b) or (c).

 

5.         Exemptions

 

(1)        The goods specified in the Schedule I shall be exempt from tax subject to the conditions and exceptions set out therein.

 

(2)        Subject to such conditions as it may impose, the State Government may, if it considers necessary so to do in the public interest, by notification in the Official Gazette, exempt any class of sales or purchases from payment of the whole of the tax payable under the provisions of this Act.

 

(3)        Every notification issued under sub‑section (2) shall be laid for not less than thirty days before the State Legislature as soon as possible after it is issued and shall be subject to rescission by the State Legislature or to such modifications as the State Legislature may make, during the session in which it is so laid or session immediately following. Any rescission or modification so made by the State Legislature shall be published in the Official Gazette, and shall thereupon take effect.

 

6.         Taxes payable by a dealer

 

Subject to the other provisions of this Act, every dealer, who is liable to pay tax under this Act, shall pay the tax leviable in accordance with the provisions of this Act.

 

7.         Levy of tax on turnover of sales and rates of tax

 

(1)        Subject to the provisions of this Act, there shall be levied a tax on the turnover of sales of goods specified in Schedule 11 at the rate set out against each of them in the said Schedule.

 

(2)        Subject to such conditions as it may impose, the State Government may, if it considers necessary so to do in the public interest, by notification in the Official Gazette add to or omit from, or otherwise amend or modify the Schedule, prospectively or retrospectively, or transpose any entry or part of any entry from one Schedule to the other Schedule or reduce the rate of tax payable in respect of any goods and thereupon the Schedule shall be deemed to have been amended accordingly.

 

(3)        Every notification issued under sub‑section (2) shall be laid for not less than thirty days before the State Legislature as soon as possible after it is issued and shall be subject to rescission by the State Legislature or to such modifications as the State Legislature may make, during the session in which it is so laid or session immediately following. Any rescission or modification so made by the State Legislature shall be published in the Official Gazette, and shall thereupon take effect.

 

8.         Adjustments in tax

 

(1)        The provisions of sub‑section (2) shall apply where, in relation to the sales of taxable goods by any registered dealer

 

(a)        that sale has been cancelled; or

(b)        the consideration previously agreed upon for that sale has been altered by agreement with the recipient, whether due to the offer of a discount or for any other reason; or

(c)        the goods or part of the goods sold have been returned to the seller, and as a result of the occurrence of any one or more of the above mentioned events of such sales, the seller has

 

(i)         provided a tax invoice in relation to that sale and the amount shown therein as tax charged on that sale is incorrect in relation to the amount properly chargeable on that sale; or

(ii)        furnished a return in relation to the period in respect of which tax on that sale is attributable, and has accounted for an incorrect amount of tax on that sale in relation to the amount properly chargeable on that sale.

 

(2)        Where a seller has accounted for either in the tax invoice or in the return an incorrect amount of tax as contemplated in sub‑section (1), such seller shall make an adjustment in calculating the tax payable by him in the return for the tax period during which it has become apparent that the tax is incorrect. Such adjustment shall be made in the following manner, namely:

 

(a)        if the amount of tax chargeable in relation to that sale exceeds the amount of tax actually accounted for by the seller, the amount of that excess shall be deemed to be tax charged by such seller in relation to a taxable sale attributable to the tax period in which the adjustment is to be made, and shall not be attributable to any prior tax period; or

(b)        the amount of tax actually accounted for exceeds the amount of tax properly chargeable in relation to that sale, such seller shall reduce the amount of tax attributable to the said tax period in terms of section 7 by that excess amount of tax:

 

PROVIDED that the reduction in the amount of tax under clause (b) shall not be made

 

(a)        where the excess tax has been borne by the purchaser of goods, or

(b)        if the relevant event as described in sub‑section (1) has occurred subsequent to the period of six months of the sales made by the dealer.

 

9.         Levy of purchase tax

 

(1)        Where a dealer who is liable to pay tax under this Act purchases any taxable goods from a person who is not a registered dealer, then there shall be levied on such dealer a purchase tax on the turnover of such purchases at the rate set out against each of such goods in Schedule 11 of this Act.

 

(2)               Where any person or dealer has purchased any taxable goods under a certificate or declaration given by him under any provision of this Act or earlier law, rule or notification, and the conditions, recitals or undertakings of such certificate or declaration are not complied with, then such person or dealer shall be liable to pay purchase tax on the turnover of such purchases at the rate set out against each of such goods in Schedule H of this Act or at the applicable rate of tax under the earlier law, whichever is higher.

 

10.       Rate of tax on packing materials

 

Notwithstanding anything contained in this Act and contract of sale, where goods packed in any materials are sold, the materials in which the goods are so packed shall be deemed to have been sold or purchased along with the goods and the tax shall be leviable on such sales or purchases of the materials at the rate of tax, if any, as applicable to the sales or as the case may be, purchase of the goods themselves.

 

11.       Tax credit

 

(1)    (a)           A registered dealer who has purchased the taxable goods (hereinafter referred to as the "purchasing dealer") shall be entitled to 'claim tax credit equal to the amount of,­

(i)         tax collected from him, by a registered dealer who has sold such goods to him or the tax payable by him to a registered dealer who has sold such goods to him during the tax period, or

(ii)        tax paid by him during the tax period under sub‑section (1) or (2) of section 9.

 

(b)        The tax credit to be so claimed under this sub‑section shall be subject to the provisions of sub‑sections (2) to (12); and the tax credit shall be calculated in such manner as may be prescribed.

 

(2)        The registered dealer who intends to claim the tax credit shall maintain the register and the books of accounts in such manner as may be prescribed.

 

(3)    (a)           Subject to the provisions of this section, tax credit to be claimed under sub‑section (1) shall be allowed to a purchasing dealer on his purchase of taxable goods made mentioned in (i) or (ii) above which are intended for the purpose of-

(i)         sale or re‑sale by him in the State;

(ii)        sale in the course of inter‑State trade and commerce, other than the sales in the course of export out of the territory of India;

(iii)       use as raw material in the manufacture of taxable goods intended for sale mentioned in (i) or (ii) above or in the packing of the goods so manufactured:

 

PROVIDED that if purchases are used partially for the purposes specified in this sub‑section, the tax credit shall be allowed proportionate to the extent they are used for the purposes specified in this sub‑section.

(b)        Notwithstanding anything contained in this section, the amount of tax credit in respect of a dealer shall be reduced by the amount of tax calculated at the rate of four per cent on the turnover of purchases

(i)         of taxable goods consigned or dispatched for branch transfer or to his agent outside the State, or

(ii)        of taxable goods which are used as raw materials in the manufacture, or in the packing of goods which are dispatched outside the State in the course of branch transfer or consignment or to his agent outside the State.

 

(4)        The tax credit shall not be claimed by the purchasing dealer until the tax period in which he receives from a registered dealer from whom he has purchased taxable goods, a tax invoice (in original) containing particulars as may be prescribed under sub‑section (1) of section 60 evidencing the amount of tax.

 

(5)        Notwithstanding anything contained in this Act, tax credit shall not be allowed for purchases

 

(a)        made from any person other than a registered dealer under this Act;

(b)        made from a dealer who is not liable to pay tax under this Act;

(c)        made from a registered dealer who has been permitted under section 14 to pay lump sum amount of tax in lieu of tax;

(d)        made prior to the relevant date of liability to pay tax as provided in sub‑section (3) of section 3;

(e)        made in the course of inter‑State trade and commerce,

(f)         of the goods which are disposed of otherwise than in sale, resale or manufacture;

(g)        of the goods specified in the Schedule I or the goods exempt from whole of tax by a notification under sub‑section (2) of section 5;

(h)        of the goods which are used in manufacture of goods specified in Schedule I or in the packing of goods so manufactured;

(i)         of the goods which are in the nature of capital goods, as defined in clause (5) of section 2 and which are meant for use as capital goods in the manufacture;

(j)         of vehicles of any type and its equipment, accessories or spare parts (except when purchasing dealer is engaged in the business of sales of such goods);

(k)        property or goods not connected with the business of the dealer;

(l)         of the goods which are used as fuel in generation of electrical energy meant for captive use or otherwise;

(m)       of the goods which are used as fuel in motor vehicles;

(n)        of the goods which remain as unsold stock at the time 'Of closure of business;

(o)        where original invoice does not contain the details of tax charged separately by the selling dealer from whom purchasing dealer has purchased the goods;

(p)        where original tax invoice is not available with purchasing dealer or there is evidence that the same has not been issued by the selling dealer from whom the goods are purported to have been purchased.

 

Notwithstanding anything contained in clause (a) or (b) in this sub‑section and subject to conditions as may be prescribed, a registered dealer shall be allowed to claim tax credit in respect of purchase tax paid by him under sub‑section (1) or (2) of section 9.

 

(6)        The State Government may, by notification in the Official Gazette, specify any goods or the class of dealers that shall not be entitled to whole or partial tax credit.

 

(7)        Where a registered dealer without entering into a transaction of sale, issues to another registered dealer tax invoice, retail invoice ', bill or cash memorandum with the intention to defraud the Government revenue or with the intention that the Government may be defrauded of its revenue, the Commissioner may, after making such inquiry as he thinks fit and giving a reasonable opportunity of being heard, deny the benefit of tax credit, in respect of such transaction, to such registered dealers issuing or accepting such tax invoice, retail invoice, bill or cash memorandum either prospectively or retrospectively from such date as the Commissioner may, having regard to the circumstances of the case, fix.

 

(8)        If the goods purchased were intended for the purposes specified under sub‑section (3) and are subsequently used fully or partly for purposes other than those specified under the said sub‑section or are used fully or partly in the circumstances described in sub‑section (5), the tax credit, if availed of, shall be reduced on account of such use, from the tax credit being claimed for the tax period during which such use has taken place; and such reduction shall be done in the manner as may be prescribed.

 

(9)        The registered dealer may claim the amount of net tax credit, which shall be determined in the manner as may be prescribed.

 

(10)      Where any purchaser, being a registered dealer, has been issued with a credit note or debit note in terms of section 61 or if he returns or rejects goods purchased, as a consequence of which the tax credit availed by him in any period in respect of which the purchase of goods relates, becomes either short or excess, he shall compensate such short or excess by adjusting the amount of tax credit allowed to him in respect of the tax period in which the credit note or debit note has been issued or goods are returned, subject to such conditions as may be prescribed.

 

(11)      A registered dealer shall apply fair and reasonable method to determine, for the purpose of this section, the extent to which the goods are sold, used, consumed or supplied, or intended to be sold, used, consumed or supplied. The Commissioner may, after giving the dealer an opportunity of being heard and for the reasons to be recorded in writing, reject the method adopted by the dealer and calculate the amount of tax credit as he deems fit.

 

(12)      Subject to the exceptions as may be prescribed by the rules, any dealer including the commission agent shall not be permitted to transfer his tax credit to any other dealer or as the case may be, the principal.

 

Explanation : For the purpose of this section, the amount of tax credit on any purchase of goods shall not exceed the amount of tax actually paid or payable under this Act in respect of the same goods.

 

12.       Tax credit for stock on 31st March, 2003

 

(1)        Within the period as may be prescribed, all the dealers who are deemed to have been registered under section 23 shall furnish in such form and to such authority as may be prescribed, a statement of taxable goods under this Act held in stock on the 31st March, 2003 for which the dealer intends to claim tax credit under this Act.

 

Explanation: For the purpose of this section, "taxable goods held in stock" includes taxable goods in the process of use in the manufacture as on the 31st March, 2003.

 

(2)        A registered dealer who has submitted the statement of taxable goods under sub‑section (1) shall not be permitted to make any changes in the details of such statement if such changes result in increase in the tax credit claimed in the statement of taxable goods.

 

(3)        If the goods shown in the statement referred to in sub‑section (1)

 

(a)        were liable to tax under the earlier law, and the purchasing registered dealer had paid the amount of tax to the selling registered dealer under the earlier law or had paid purchase tax under the earlier law, and

(b)        are intended to be used for the purposes specified in sub‑section (3) of section 11

 

then the amount of tax so paid by the purchasing dealer on such goods, determined in such manner and subject to the provisions of section 11 as far as they may apply and further subject to such conditions and restrictions and to such extent as may be prescribed, shall be allowed as the tax credit to the dealer referred to in sub‑section (1). Such tax credit shall be available as the outstanding credit brought forward for being claimed in such manner as may be prescribed.

 

(4)        Notwithstanding anything contained in this section, no tax credit under this section shall be allowed in respect of those goods,

 

(a)        which are not taxable under this Act or the earlier law;

(b)        which are not included in the statement of taxable goods referred to in sub‑section (1);

(d)        which are not recorded in the books of accounts of the dealer claiming tax credit under this section; or

(e)        which are declared as "prohibited goods" under clause (21) of section 2 of the Gujarat Sales Tax Act, 1969.

 

(5)        Where the amount of tax on the goods purchased is not indicated separately on the sale vouchers, the tax credit under this section shall be calculated in the manner as may be prescribed.

 

(6)        The provisions of section 11 shall apply mutatis mutandis to the tax credit to be availed of under this section.

 

(7)        If the Commissioner is satisfied that a dealer

 

(a)        has claimed tax credit for such stock for which he is not entitled for claiming tax credit as per the provisions of section 11 and sub‑sections (3) and (4) of section 12, or

(b)        has claimed excess tax credit than what he is entitled to under section 11 or under this section the Commissioner may, after giving the dealer an opportunity of being heard direct him to pay a penalty equal to twice the amount of tax credit so claimed.

 

13. Net amount of value added tax

 

The net amount of value added tax for a tax period payable shall be determined after the adjustment of tax credit in the manner as may be prescribed.

 

14. Option for payment of lump sum tax in lieu of tax on sales

 

(1)     (a)          Notwithstanding anything contained in this Act, the Commissioner may, in such circumstances and subject to such conditions as may be prescribed, permit any dealer, who is not engaged in the activity of manufacture and whose total taxable turnover has not exceeded rupees twenty‑five lakhs in the previous year, to pay lump sum tax in lieu of the amount of tax payable under section 7 of this Act.

(b)        The permission granted under sub‑section (1) shall remain valid so long as the total taxable turnover of the registered dealer does not exceed rupees twenty‑five lakhs. In case where total taxable turnover of a registered dealer exceeds rupees twenty‑five lakhs during the course of the year, he shall be liable to pay tax under the provisions of this Act from the tax period as may be prescribed for this purpose.

 

Explanation: For the purpose of permission under clause (a) for the year 2003‑04, total taxable turnover shall be calculated with reference to the Gujarat Sales Tax Act, 1969.

 

(2)        The State Government may, fix the rate of lump sum tax by notification in the Official Gazette.

 

(3)        A dealer who is permitted under sub‑section (1) to pay lump sum tax shall not,­

 

(a)        be entitled to claim tax credit in respect of tax paid by him on his purchases,

(b)        charge any tax under this Act in his sales bill or sales invoice in respect of the sales on which lump sum tax is payable; and

(c)        issue tax invoice to any dealer who has purchased the goods from him.

 

(4)        A dealer who is permitted under sub‑section (1) to pay lump sum tax shall be liable to pay, in addition to the lump sum tax under this section,

 

(a)        purchase tax leviable under sub‑sections (1) and (3) of section 9;

(b)        tax at the rate specified under section 7 in respect of sales of goods within the State,­

(i)         which are purchased or brought from other State in any manner, or

(ii)        which are purchased in the course of import from outside the territories of India, and

 

Explanation: For the removal of doubts, it is clarified that the dealer who has been permitted to opt for composition under this section shall be liable to pay Central sales tax as per the provisions of Central Act in respect of sales made by him in the course of inter‑State trade and commerce.

 

15.       Burden of proof

 

The burden of proof shall lie on a dealer who claims that he is not liable to pay tax under this Act in respect of any sale effected by him or is eligible for a tax credit under section 11 and section 12.

                                   

COMMERCIAL TAX AUTHORITIES AND TRIBUNAL

 

16.       Commercial Tax Authorities and jurisdiction

 

(1)        For carrying out the purposes of this Act, the State Government shall appoint an officer to be called the Commissioner of Commercial Tax.

 

(2)        To assist the Commissioner in the execution of his functions under this Act, the State Government may appoint Special Commissioners, Additional Commissioners and such number of

 

(a)        joint Commissioners,

(b)        Deputy Commissioners,

(c)        Assistant Commissioners,

(d)        Commercial Tax Officers, and

(e)        other officers and persons, and give them such designations, as the State Government thinks necessary.

 

(3)        The Commissioner shall have jurisdiction over the whole of the State, the Special Commissioner and an Additional Commissioner shall have jurisdiction over the whole of the State or where the State Government so directs, over any local area thereof. All other officers shall have jurisdiction over the whole of the State or over such local areas as the State Government may specify.

 

(4)        The Commissioner shall have and exercise all the powers and perform all the duties, conferred or imposed on him by or under this Act. The Special Commissioner and an Additional Commissioner shall, save as otherwise directed by the State Government, have and exercise within his jurisdiction all the powers and perform all the duties, conferred or imposed on the Commissioner by or under this Act.

 

(5)        A joint Commissioner shall have and exercise, in the area within his jurisdiction all the powers and shall perform all the duties conferred or imposed on the Commissioner by or under this Act. The Commissioner may, by order published in the Official Gazette, direct that any or all joint Commissioners shall not exercise such powers or perform such duties as are specified in the order, and thereupon such Joint Commissioner or, as the case may be, all Joint Commissioners, shall cease to exercise those powers and perform those duties. The Commissioner may in like manner revoke any such direction and thereupon the powers or duties exercisable or performable by such joint Commissioner, or as the case may be, all Joint Commissioners before such direction was issued, shall be restored to him or them.

 

(6)        The Deputy Commissioners, Assistant Commissioners, Commercial Tax Officers and other officers shall within their jurisdiction exercise such of the powers and perform such of the duties of the Commissioner under this Act, as the Commissioner may, subject to such conditions and restrictions as the State Government may by general or special order impose, by order in writing delegate to them either generally or as respects any particular matter or class of matters.

 

(7)        The State Government may, subject to such restrictions and conditions as it may impose by notification in the Official Gazette, delegate to the Commissioner the power (not being powers relating to the appointment of Special Commissioner, Additional Commissioner or joint Commissioners), conferred on the State Government by sub‑sections; (2) and (3).

(8)        All officers and persons appointed under sub‑section (2) shall be subordinate to the Commissioner; and the subordination of officers (other than the Commissioner), and of persons amongst themselves shall be such as may be prescribed.

 

17. Power to transfer proceedings

 

(1)        The Commissioner may, after due notice to the concerned parties and by order in writing, transfer any proceedings or class of proceedings under any provision of this Act from himself to any other officer and he may likewise transfer any such proceedings (including a proceeding already transferred under this section) from one such officer to another or to himself.

 

(2)        The officer to whom any proceeding is transferred under sub‑section (1) shall proceed to dispose it of as if it had been initiated by himself.

 

(3)        The transfer of proceedings shall not render necessary the re‑issue of any notice already issued before such transfer and the officer to whom the proceeding is transferred may continue it from the stage at which it was left by the officer from whom it was transferred.

 

Explanation : For the purposes of this section, "proceedings" in relation to any person whose name is specified in any order issued thereunder, means all proceedings under this Act in respect of any year which may be pending on the date of such order or which may have been completed on or before such date, and includes also such proceedings which may be commenced after the date of such order in respect of any year.

 

18.       Disputes regarding jurisdiction of tax authority

 

 

(1)        No person shall be entitled to call in question the jurisdiction of any tax authority appointed under section 16, after the expiry of thirty days from the date of receipt by that person of any notice issued by such tax authority under this Act.

 

(2)        An objection as to the jurisdiction of any such tax authority may be raised within the periods aforesaid by submitting a memorandum to that tax authority who shall refer the question to the Commissioner and the Commissioner shall after giving the person raising the objection, a reasonable opportunity of being heard, make an order determining the question of jurisdiction and his decision in this behalf shall be final.

 

19.       Tribunal

 

(1)        The State Government shall constitute a Tribunal consisting of as many as members as it thinks fit to discharge the functions conferred on the Tribunal by or under this Act.

 

(2)        The State Government shall appoint one of the members of the Tribunal to be President thereof.

 

(3)        The qualifications of the members constituting the Tribunal shall be such as may be prescribed and a member shall hold office for such period as the State Government may fix.

 

(4)        The State Government may terminate the appointment of any member of the Tribunal before the expiry of term of his office, if such member,

 

(a)        is adjudged an insolvent, or

(b)        engages during his term of office in any paid employment outside the duties of his office, or

(c)        is or becomes in any way concerned or interested in any contract or agreement made by or on behalf of the State Government or participates in any way in the profit thereof or in any benefit or emoluments arising therefrom otherwise than as a member, or

(d)        is in the opinion of the State Government, unfit to continue in office by reason of infirmity of mind or body, or

(e)        is convicted of an offence involving moral turpitude.

 

(5)        Any vacancy of a member of the Tribunal shall be filled up by the State Government as soon as practicable.

 

(6)        The functions of the Tribunal maybe discharged by one or more Benches thereof constituted in accordance with the regulations made under sub‑section (9).

 

(7)        If the members of the Tribunal or a Bench thereof are divided, the decision shall be the decision of the majority, if there be a majority, but if the members are equally divided they shall state the point or points on which they differ, and the case shall be referred by the President of the Tribunal for hearing on such point or points to one or more of the other members of the Tribunal, and such point or points shall be decided according to the majority of the members of the Tribunal who heard the case including those who first heard it.

 

(8)        Subject to such conditions and limitations as may be prescribed, the Tribunal shall have power to award cost and the amount of such costs shall be recoverable from the person ordered to pay the same as an arrears of land revenue.

 

(9)        Subject to the previous sanction of the State Government, the Tribunal shall, for the purpose of regulating its procedure (including the place or places at which the Tribunal or the Benches thereof shall sit) and the disposal of its business, make regulations consistent with the provisions of this Act and the rules.

 

(10)      The regulations made under sub‑section (9) shall be published in the Official Gazette.

 

20.       Powers of Tribunal and Commissioner

 

(1)        In discharging their functions under this Act, the Tribunal and the Commissioner shall have all the powers of a civil court for the purpose of,

 

(a)        receiving of proof of facts on affidavit;

(b)        summoning and enforcing the attendance of any person, and examining him on oath or affirmation;

(c)        compelling the production of documents; and

(d)        issuing commissions for the examination of witnesses.

 

(2)        In the case of any affidavit to be made for the purposes of this Act, any officer appointed by the Tribunal or the Commissioner may administer the oath to the deponent.

           

REGISTRATION

21.       Registration

 

(1)        No dealer shall, while being liable to pay tax under this Act, carry on business as a dealer unless he possesses a valid certificate of registration as provided by this Act:

 

PROVIDED that the provisions of this sub‑section shall not be deemed to have been contravened if the dealer having applied for such registration, as provided in this section, within the prescribed time carries on such business.

 

(2)        A dealer dealing exclusively in goods specified in Schedule I shall not be liable for registration.

 

(3)        Every dealer, required by sub‑section (1) to possess a certificate of registration, shall apply in such. form, to such authority and in such manner as may be prescribed.

 

(4)        If the prescribed authority is satisfied that an application for registration is in order, it shall register the applicant and issue him a certificate of registration in the prescribed form.

 

(5)        The prescribed authority may, after considering any information furnished under any provisions of this Act or otherwise received, amend from time to time, any certificate of registration.

 

(6)        When a dealer has been subjected or is liable to be subjected to a penalty or is convicted in respect of contravention of the provisions of sub‑section (1), the prescribed authority shall register such dealer, if such dealer is not a registered dealer, and issue him a certificate of registration. Such registration shall take effect from the date of the issue of the certificate in every respect as if it had been issued under sub‑section (3) on an application of the dealer.

 

(7)        Where

 

(a)        any business, in respect of which a certificate of registration has been issued under this section, has been discontinued or, transferred, or

(b)        total turnover and taxable turnover of a dealer during the preceding year has not exceeded the thresholds of turnover specified in sub‑section (1) of section 3,

 

and the dealer applies in the prescribed manner for cancellation of his registration, the prescribed authority shall cancel the registration with effect from such date as it may fix in accordance with the rules.

 

(8)        Where the Commissioner is satisfied that any business in respect of which a certificate of registration has been issued under this section, has been discontinued and the dealer has failed to apply as aforesaid for cancellation of registration, the Commissioner may, after giving the dealer a reasonable opportunity of being heard, cancel the registration with effect from such date as he may fix to be the date from which the business has been discontinued.

 

(9)        The cancellation of a certificate of registration on an application of the dealer or otherwise, shall not affect the liability of the dealer to pay the tax, penalty or interest due for any period prior to the date of cancellation whether such tax, penalty or interest is assessed before the date of cancellation but remains unpaid, or is assessed thereafter.

 

22.       Voluntary registration

 

(1)        A dealer having a fixed or regular place of business in the State and who is not required to be registered under section 21, may apply in the prescribed manner for the certificate of registration to the authority prescribed for the purpose under section 21.

 

(2)        If the prescribed authority is satisfied that the application made by the dealer under sub‑section (1) is in order, it may grant him a certificate of registration in the prescribed form:

 

PROVIDED that no certificate of registration under this section shall be granted to the dealer unless he deposits an amount of rupees twenty‑five thousand in the Government treasury. The dealer may, in his return to be furnished in accordance with section 29, adjust the amount so deposited against his liability to pay tax, penalty or interest payable under this Act.

 

(3)        The provisions of sub‑section (4) and clause (a) of sub‑section (7) and sub‑section (8) of section 21 shall apply in respect of the amendment or cancellation of certificate of registration granted under this section.

 

(4)        Notwithstanding anything contained in this Act, every dealer who has been registered under sub‑section (2) shall, so long as his registration remains in force, be liable to pay the tax under this Act.

 

23.              Deemed registration

 

Every dealer registered as on the appointed day under any of the earlier laws or under the Central Act shall be deemed to be registered under section 21.

 

24.       Non transferability of registration

 

Save as otherwise provided in section 25, a certificate of registration shall be personal to the dealer to whom it is granted and shall not be transferable.

 

25.       Continuation of certificate of registration of dissolved firm

 

Where,-

 

(a)        a registered dealer is a firm and on the death of any partner of such firm, the firm stands dissolved, and

(b)        the person who immediately before such dissolution was a partner of the firm carries on business of the dissolved firm, as proprietor, then

(i)         until the certificate of registration granted to the firm prior to its dissolution is amended under sub‑clause (ii), the certificate of registration granted to the firm prior to its dissolution shall, subject to section 27, continue to be valid for a period of six months;

(ii)        on an application made by such person within a period of six months from the date of dissolution of the firm for amendment of the certificate of registration and on information being furnished in the manner required by section 26, the certificate of registration granted to the firm prior to its dissolution shall be amended accordingly.

 

26.       Amendment of certificate of registration

 

(1)        Where a registered dealer-

 

(a)        transfers his business, in whole or in part, or transfers his place of business, by sale, lease, leave or licence, hire or in any other manner whatsoever, or otherwise disposes of his business or any part thereof or effects or comes to know of any other change in the ownership of the business,

(b)        discontinues his business or changes the place of business thereof or opens a new place of business, or temporarily closes the business for a period more than thirty days;

(c)        changes the name, style, constitution or nature of his business, or

(d)        enters into partnership or other association in regard to his business or effects any changes in the ownership of the business,

 

he shall, within the prescribed time inform the prescribed authority accordingly, and if any such dealer dies, his legal representative shall inform of such death or where any such dealer is a firm and there is any change in the constitution of the firm or the firm is dissolved, every person who was a partner thereof, shall in like manner, inform the said authority of the change in the constitution or as the case may be, dissolution of the firm.

 

(2)        The Commissioner may, after considering any information furnished under this Act or otherwise received and after making such inquiry as he may deem fit, amend from time to time, any certificate of registration:

 

PROVIDED that the Commissioner, shall, before amending on his own motion a certificate of registration, give the dealer affected by such amendment an opportunity of being heard.

 

(3)        An amendment of the certificate of registration made under sub‑section (1) or (2) shall take effect from the date of contingency, which necessitates the amendment, whether or not information in that behalf is furnished within the time prescribed under sub‑section (1).

 

(4)        Any amendment of a certificate of registration under this section shall be without prejudice to any liability for tax, interest or penalty or for any prosecution for an offence under this Act.

 

(5)        If a dealer fails, without sufficient cause, to comply with the provisions of sub‑section (1), the Commissioner may after giving the dealer a reasonable opportunity of being heard, direct him to pay, by way of penalty a sum of rupees one hundred per day of default subject to a maximum of rupees five thousand.

 

(6)        For the removal of doubts, it is hereby declared that where a registered dealer

 

(a)        effects a change in the name of his business;

(b)        is a firm and there is a change in the constitution of the firm without dissolution thereof;

(c)        is a trustee of a trust and there is a change in the trustees thereof;

(d)        is a Hindu Undivided Family and the business of such family is converted into a partnership business with all or any of the co‑operation as partners thereof; or

(e)        is a firm or a company or a trust or any other set up and change in the management takes place including the change of the director or the Managing Director of the company;

 

then merely by reason of the circumstances as aforesaid, it shall not be necessary for the dealer to apply for a fresh certificate of registration and on information being furnished in the manner required by this section, the certificate of registration shall be amended.

 

27. Cancellation of registration

 

(1)        Where-

 

(a)        any business, in respect of which a certificate of registration has been issued to a dealer under this Act is discontinued;

(b)        in the case of transfer of whole business by a dealer, the transferee already holds a certificate of registration under this Act;

(c)        an incorporated body has been wound up or it otherwise ceases to exist;

(d)        the owner of a proprietorship business dies leaving no successor to carry on the business;

(e)        in case of a firm or association of persons, it is dissolved; or

(f)         a dealer has ceased to be liable to pay tax under this Act,

 

the Commissioner may cancel the certificate of registration of such dealer or the transferor, as the case may be, from such date, as may be specified by him.

 

(2)        A registered dealer, whose certificate of registration is liable to be cancelled under sub‑section (1), may apply for cancellation of his registration to the prescribed authority, in the manner and within the time prescribed.

 

(3)        On receipt of such application from the dealer, if the registering authority is satisfied that the dealer fulfils the conditions specified in sub‑section (1), he shall cancel the registration of such dealer.

 

(4)        The certificate of registration shall be deemed to be inoperative

 

(a)        in case of clause (a) or (b) of sub‑section (1), with effect from the date of discontinuance or, as the case may be, transfer of the business;

(b)        in case of clause (c), (d), (e) or (f) of sub‑section (1), from the date on which the dealer's liability to pay tax has ceased, notwithstanding the fact that the order of cancellation is passed or not or that the particulars of the dealer regarding cancellation are published as required under sub‑section (11) or not.

 

(5)        If a dealer-

 

(a)        has failed to file three consecutive returns within the time prescribed under this Act;

(b)        knowingly furnishes incomplete or incorrect particulars in his returns;

(c)        has failed to pay tax due from him under the provisions of this Act;

(d)        having issued tax invoice or retail invoices, has failed to account for the said invoices in his books of account;

(e)        holds or accepts or furnishes or causes to be furnished a declaration, which he knows or has reason to believe to be false;

(f)         who has been required to furnish security under section 28, but has failed to furnish such security;

(g)        has been convicted of an offence under this Act, or under the earlier law;

(h)        discontinues his business and has failed to furnish information regarding such discontinuation, or

(i)         without entering into a transaction of sale issues to another dealer tax invoice, retail invoice, bill or cash memorandum with the intention to defraud the Government revenue,

 

the Commissioner may at any time, for reasons to be recorded in writing and after giving the dealer an opportunity of being heard, cancel his certificate of registration from such date as may be specified by him.

 

(6)        Every person whose registration is cancelled under sub‑section (5) shall pay in respect of every taxable goods held as stock on the date of cancellation an amount equal to the tax that would be payable in respect of the goods if the goods were sold at fair market price on that date or the total tax credit previously claimed in respect of such goods, whichever is higher.

 

(7)        If an order of cancellation passed under this section is set aside as a result of an appeal or other proceedings under this Act the certificate of registration of the dealer shall be restored and he shall be deemed to be treated as if his registration was not cancelled.

 

(8)        Every dealer who applies for cancellation of registration shall surrender with his application the certificate of registration granted to him and every dealer whose registration is cancelled otherwise than on the basis of his application shall surrender the certificate of registration within seven days from the date of communication to him of the order of cancellation:

 

PROVIDED that if a dealer is unable to surrender the certificate of registration on account of loss, destruction or defacement of such certificate, such dealer shall intimate the registering authority accordingly within seven days from the date of communication of order of cancellation of registration.

 

(9)        If a dealer-

 

(a)        fails without sufficient cause to comply with the provisions of sub‑section (2); or

(b)        fails to surrender his certificate of registration as provided in sub‑section (8),

 

the Commissioner may, by an order in writing and after giving the dealer an opportunity of being heard, direct that the dealer shall pay, by way of penalty, a sum equal to rupees one hundred for every day of default.

 

(10)      Cancellation of a certificate of registration shall not affect the liability of any dealer to pay tax, penalty or interest due for any period till the date of such cancellation and which has remained unpaid or is assessed thereafter.

 

(11)      The Commissioner shall publish in the manner as may be prescribed the particulars of dealers whose certificate of registration has been cancelled under the provisions of this Act.

 

28.       Security from certain class of dealers

 

(1)        Where it appears necessary to the authority to which an application is made under section 21 or 22 for issue of certificate of registration, so to do for the proper realization of the tax, penalty and interest payable under this Act, it may by an order in writing and for the reasons to be recorded therein, impose as a condition for the issue of certificate of registration a requirement that the dealer shall furnish in the prescribed manner and within such time as may be specified in the order, such security as may be specified in the order for the aforesaid purpose.

 

(2)        Where it appears necessary to the authority referred to in section 21, or the Commissioner so to do for the proper realization of the tax, interest and penalty payable or which has become due for payment, for any period of any year, he may, at any time, by an order in writing and for reason to be recorded therein, require a registered dealer to furnish in the prescribed manner and within such time as may be specified in the order, such security or if such dealer has already furnished any security, such additional security as may be specified in the order.

 

(3)        No dealer shall be required to furnish any security under sub‑section (1) or any security or additional security under sub‑section (2) unless he has been given an opportunity of being heard.

 

(4)        The amount of security, which a dealer may be required to furnish under sub‑section (1) or sub‑section (2), or the aggregate of the amount of such security, and the amount of additional security which he maybe required to furnish under sub‑section (2) by the authority referred to therein or the Commissioner, shall not exceed the amount of tax, interest and penalty payable or which has become due for payment for a period of any year according to the estimate of the authority referred to in sub‑section (1) or the Commissioner, on the turnover of sales or turnover of purchase of goods of such dealer for any period of any year.

 

(5)        Where the security furnished by a dealer under sub‑section (1) or sub‑section (2) is in the form of a surety bond and the surety becomes insolvent or dies, the dealer shall, within thirty days of the occurrence of any of the aforesaid events, inform the authority referred to in sub‑section (1) or sub‑section (2) or, as the case may be, the Commissioner and shall within ninety days of such occurrence, furnish a fresh security for the same amount as that of the bond in the form of a bond or in any other prescribed manner.

 

(6)        The authority referred to in sub‑section (1) or sub‑section (2) or, as the case may be, the Commissioner may, by order and for good and sufficient cause, forfeit the whole or any part of the security furnished by a dealer for realizing any amount of the tax, interest or penalty payable by the dealer:

 

PROVIDED that no order shall be passed under this sub‑section without giving the dealer an opportunity of being heard.

 

(7)        Where by reason of an order under sub‑section (6), the security furnished by any dealer is rendered insufficient, he shall make up the deficiency in such manner and within such time as may be prescribed.

 

(8)        The authority referred to in sub‑section (1) or sub‑section (2) or, as the case may be, the Commissioner may, on an application made by a dealer in that behalf, make an order of refund of any amount or part thereof deposited by the dealer by way of security or for the release of bond under this section, if it is not required for the purpose of realization of tax, interest or penalty.

 

(9)        Where a dealer fails to furnish security as required under sub‑section (1), (2), (5) or (7), the authority referred to in section 21 shall refuse to issue or, as the case may be, shall cancel the certificate of registration:

 

PROVIDED that the refusal or cancellation of a certificate of registration under this sub‑section shall, notwithstanding anything contained in sub‑section (3) of section 3, not affect the liability of the dealer to pay the tax, penalty and interest due for any period before or after the date of such refusal or cancellation of the certificate of registration; and accordingly the provisions of this Act shall continue to apply.

 

 

RETURNS, PAYMENT OF TAX, ASSESSMENT, RECOVERY OF TAX AND REFUND

 

29.       Returns

 

(1)        Every registered dealer shall furnish correct and complete returns in such form, for such period, by such dates and to such authority, as may be prescribed.

 

(2)        The Commissioner may, subject to such terms and conditions as may be prescribed, exempt any dealer from furnishing returns or permit any dealer,

 

(a)        to furnish for such different periods, or

(b)        to furnish separate returns relating to various places of business of a dealer in the State for the said period, or for such different period, to such authority, as he may direct.

 

(3)        If the Commissioner has reason to believe that the total turnover of any dealer is likely to exceed the thresholds of turnover specified in sub‑section (1) of section 3, he may, by notice served in the prescribed manner, require such dealer to furnish returns as if he were a registered dealer, but no tax shall be payable by such dealer, unless he becomes liable to pay tax under sub‑section (1) of section 3.

 

(4)        If any dealer having furnished returns under sub‑section (1) or (3) discovers any mistake, error, omission or incorrect statement therein, he may furnish a revised return before the expiry of three months next following the last date prescribed for furnishing the original return.

 

(5)        If a registered dealer or any other dealer required to furnish return under this section fails to furnish any return by the prescribed date as required under sub‑section (1) or fails to comply with the requirement of notice issued under sub‑section (3), the Commissioner shall direct him to pay, in addition to any tax and interest payable or paid by him, by way of penalty a sum of rupees one hundred per month or part thereof for the default period. The penalties specified under this sub‑section shall be imposed by the Commissioner notwithstanding the fact that the assessment proceedings have not been initiated against the dealer under section 32, 33 or 34. Any penalty imposed under this sub‑section shall be without prejudice to any prosecution for any offence under this Act.

 

30.       Periodical payment of tax and interest on non‑payment of tax

 

(1)        Tax shall be paid in the manner hereinafter provided, and at such intervals as may be prescribed.

 

(2)        Every registered dealer furnishing return as required by sub‑section (1) of section 29 shall pay into a Government treasury, in the manner prescribed, the whole amount due from him according to such return and shall furnish along with the return a receipt showing full payment of such amount.

 

(3)        If the revised return furnished by a registered dealer in accordance with sub‑section (4) of section 29, shows a higher amount of tax due than shown in the return earlier furnished by him, he shall pay into a Government treasury the remaining amount of tax arising from the revised return along with interest on delayed payment of such remaining amount, and furnish along with the revised return a receipt showing such payment.

 

(4)        If a registered dealer does not pay the amount of tax payable in accordance with the provisions of sub‑section (1), (2) or (3), the Commissioner shall forthwith initiate recovery proceedings under this Act.

 

(5)        Where a dealer does not pay the amount of tax within the time prescribed for its payment under this section, then there shall be paid by such dealer for the period commencing on the date of expiry of the aforesaid prescribed time and ending on date of payment of the amount of tax, simple interest at the rate of eighteen per cent, per annum, on the amount of tax not so paid or on any less amount thereof remaining unpaid during such period.

 

31.       Collection of tax only by registered dealers

 

(1)        A person who is not a registered dealer shall not collect in respect of any sale of goods any amount by way of tax under this Act and no registered dealer shall make any such collection except in accordance with the provisions of this Act and the rules made thereunder.

 

(2)        A registered dealer who has been permitted by the Commissioner to make a lumpsum payment under section 14 shall not collect from his purchaser any sum by way of tax on the sales of goods during the period the permission for lumpsum tax is valid.

 

(3)        The tax collected and deposited under the provisions of this Act to which a dealer may be held not liable shall not be refunded to the dealer and the amount of such tax shall stand forfeited to the Government.

(4)        If any person collects any amount by way of tax in contravention of the provisions of this Act, he shall be liable to pay, in addition to any tax payable, a penalty equal to the amount so collected.

 

32.       Return scrutiny and provisional assessment

 

(1)        Returns or revised returns furnished by the dealer in accordance with section 29 shall be subject to scrutiny by the Commissioner.

 

(2)   (a)            If any dealer has furnished return or revised return according to which,‑

(i)         net amount of tax payable, in accordance with section 13, is nil, or

(ii)                the amount of tax credit is carried forward for subsequent return, or

(iii)               the amount of refund is claimed therein, or

(iv)       the dealer has claimed in his return or the revised return higher amount of tax credit than the admissible amount of tax credit,

 

then, the Commissioner may, as soon as possible, provisionally assess such dealer for the period of such return or as the case may be, revised return. For the purpose of aforesaid provisional assessment, the Commissioner shall serve on such dealer in the prescribed manner a notice requiring him to explain in writing, on or before the date specified in the aforesaid notice the basis on which the dealer has furnished such returns or the revised returns. The Commissioner may, after considering such explanation provisionally assess the amount of tax due from such dealer and issue an order in the prescribed form.

 

(b)        If the dealer who has been served the notice under clause (a) fails to comply with requirement of clause (a), the Commissioner shall determine the amount of tax payable in the manner as may be prescribed and serve on such dealer an order of the provisional assessment.

 

(3)        Where a registered dealer has not furnished the return in respect of any tax period within the prescribed time, the Commissioner shall, notwithstanding anything contained in section 34, proceed to assess the dealer provisionally for the period for such default. Such provisional assessment shall be made on the basis of past returns or past records or on the basis of information received by the Commissioner and the Commissioner shall direct the dealer to pay the amount of tax assessed in such manner and by such date as may be prescribed.

 

(4)        Where the Commissioner has reason to believe that the dealer has evaded the tax or has claimed more amount of tax credit than the admissible amount of tax credit, he may, after taking into account all relevant materials gathered by him and after giving the dealer a notice in the prescribed form, provisionally assess to the best of his judgment the amount of tax payable by the dealer.

 

(5)        The provisions of this Act shall mutatis mutandis apply to the provisional assessment as if provisional assessment were an audit assessment made under this Act.

 

(6)        Nothing contained in this section shall prevent the Commissioner from making assessment under sections 33 and 34.

 

33.       Self assessment

 

(1)        Every registered dealer shall, by such dates and to such authority as may be prescribed, furnish annual return by way of self‑assessment in the prescribed form, containing such particulars and accompanied by supporting documents, as may be prescribed.

 

(2)        The amount of tax credit, exemptions and other claims by the dealer in the annual return for which no supporting tax invoice, declarations, certificates, or evidence required under this Act or the Central Act is furnished, shall be self‑assessed by the dealer by disallowing such tax credits, exemptions and other claims and by levying the appropriate rate of tax as if the sales or purchases were taxable.

 

(3)        If a dealer has furnished all the returns, revised returns, if any, and annual return within the prescribed period and the Commissioner is satisfied that the returns or as the case may be, revised returns, and annual return are correct and complete, he may accept the annual return by way of self‑assessment filed by the dealer and shall assess the amount of tax and interest due from the dealer on the basis of such returns. The Commissioner shall send to such dealer an intimation in the prescribed form regarding the assessment done under this section.

 

34.       Audit assessment

 

(1)        Subject to the provisions of sub‑section (2), the amount of tax due from a registered dealer shall be assessed in the manner hereinafter provided, separately for each year, during which he is liable to pay tax.

 

(2)        Where,-

(a)        the Commissioner is not satisfied with the bona fides of any claim of tax credit, exemption, refund, deduction, concession, rebate; or genuineness of any declaration or evidence furnished by a dealer in support thereof with the self‑assessment, or

(b)        the Commissioner has reason to believe that detailed scrutiny of the case is necessary, the Commissioner may, notwithstanding the fact that the dealer may have been assessed under section 33, serve on such dealer in the prescribed manner a notice requiring him to appear on a date and place specified therein, which may be his place of business or a place specified in the notice, either to attend and produce or cause to be produced the books of account and all evidence on which the dealer relies in support of his returns or to produce such evidence as specified in the notice.

 

(3)        The dealer shall provide all co‑operation and reasonable assistance to the Commissioner as may be required in case the proceedings under this section are required to be conducted at his place of business.

 

(4)        If proceedings under this section are to be conducted at the place of business of the dealer and it is found that the dealer is not functioning from such premises or no such premises exists, the Commissioner shall assess to the best of his judgment the amount of tax due from him.

 

(5)        If the Commissioner is unlawfully prevented from conducting the proceedings under this section, he may assess to the best of his judgment the amount of tax due from the dealer and may further direct that the dealer shall pay, by way of penalty, in addition to the amount of tax so assessed, a sum equal to the tax amount.

 

(6)        If any dealer-

 

(a)        has not furnished returns in respect of any period by the prescribed date;

(b)        has furnished incomplete or incorrect returns for any period;

(c)        has failed to comply with the terms of notice issued under sub‑section (2);

(d)        has failed to maintain books of accounts in accordance with the provisions of this Act or Rules made thereunder or has not regularly employed any method of accounting,

 

the Commissioner shall assess to the best of his judgment the amount of tax due from him.

 

(7)        If the Commissioner is satisfied that the dealer, in order to evade or avoid payment of tax,

 

(a)        has failed to furnish, without reasonable cause, returns in respect of any period or the self‑assessment by the prescribed date;

(b)        has furnished incomplete or incorrect returns for any period;

(c)        has availed tax credit for which he is not eligible;

(d)        has employed such method of accounting which does not enable the Commissioner to assess the tax due from him; or

(e)        has knowingly furnished false or incorrect self assessment,

 

he shall, after giving the dealer an opportunity of being heard, direct that the dealer shall pay, by way of penalty, a sum equal to twice the amount of tax assessed on account of the said reason in the audit assessment.

 

(8)        If the Commissioner, upon information which has come into his possession, is satisfied that any dealer who has been liable to pay tax under this Act in respect of any period, has failed to get himself registered, the Commissioner shall proceed to assess to the best of his judgment the amount of tax due from the dealer in respect of such period and all subsequent periods. In making such assessment, he shall give the dealer an opportunity of being heard. The Commissioner may, if he is satisfied that the default was without reasonable cause, direct that the dealer shall pay, by way of penalty, in addition to the amount of tax so assessed, a sum equal to the amount of tax assessed or a sum of rupees five thousand, whichever is more.

 

(9)        No assessment under sub‑sections (2),(5),(6) or (7) shall be made after the expiry of four years from the end of the year in respect of which or part of which the tax is assessable.

 

(10)      No assessment under sub‑section (8) shall be made after the expiry of eight years from the end of the year in respect of which or part of which the tax is assessable:

 

PROVIDED that where any assessment is required to be made in pursuance of an order of any court or authority, such fresh assessment shall be made at any time within two years from the date of such order:

 

PROVIDED FURTHER that in computing the period of limitation  for the purpose of this section, any period during which assessment proceedings are stayed by an order or injunction of any court or authority shall be excluded.

 

(11)      Any assessment made or penalty imposed under this section shall be without prejudice to prosecution for any offence under this Act.

 

(12)      Where in the case of a dealer, the amount of tax assessed for any period under this section or reassessed for any period under section 35 exceeds the amount of tax already paid under sub‑section (1), (2) or (3) of section 30 by the dealer in respect of such period by more than twenty five per cent of the amount of tax so paid, there shall be levied on such dealer a penalty not exceeding one and one‑half times the difference between the tax paid under section 30 and the amount so assessed or reassessed.

 

35.       Turnover escaping assessment

 

(1)        Where after a dealer has been assessed under section 32, 33 or 34 for any year or part thereof, the Commissioner has reason to believe that the whole or any part of the taxable turnover of the dealer in respect of any period has,

 

(a)        escaped assessment; or

(b)        been under‑assessed; or

(c)        been assessed at a rate lower than the rate at which it is assessable; or

(d)        wrongly been allowed any deduction there from; or

(e)        wrongly been allowed any tax credit therein,

 

the Commissioner may serve a notice on the dealer and after giving the dealer an opportunity of being heard and making such inquiry as he considers necessary, proceed to determine to the best of his judgment, the amount of tax due from the dealer in respect of such turnover which comes to his notice subsequently, and the provisions of this Act shall, so far as may be, apply accordingly.

 

(2)        No order shall be made under sub‑section (1) after the expiry of five years from the end of the year in respect of which or part of which the tax is assessable.

 

36.       Refund of excess payment

 

(1)        Subject to other provisions of this Act and the Rules, the Commissioner may refund to a person the amount of tax, penalty and interest, if any, paid by such person in excess of the amount due from him:

 

PROVIDED that the Commissioner shall first apply such excess towards the recovery of any amount due under this Act or the earlier laws and shall then refund only the balance amount, if any:

 

PROVIDED FURTHER that no such adjustment under the proviso shall be made towards a recovery of an amount due that has been stayed by an appellate authority.

 

(2)        Where any refund is due to any dealer, according to the return furnished by him for any period, such refund may provisionally be adjusted by him against the tax due and payable as per the returns furnished under section29 for any subsequent period in the year:

 

PROVIDED that the amount of tax, penalty or interest or surety forfeited or all or any of them due from and payable by the dealer on the date of such adjustment, shall first be deducted from such refund before making the adjustment.

 

37.       Provisional refund

 

(1)        If a registered dealer has filed any return as required by or under this Act, and such return shows any amount to be refundable to the dealer, then the dealer may apply in such form and in such manner as may be prescribed, to the Commissioner for grant of provisional refund pending assessment.

 

(2)        Subject to the provisions of sub‑section (3), the Commissioner may require the aforesaid dealer to furnish a bank guarantee or other security as may be prescribed, for an amount equal to the amount of refund. On receipt of such guarantee or other security, the Commissioner may, subject to rules, grant provisional refund to the dealer.

 

(3)        The Commissioner may direct that assessment under section 32 of such dealer in respect of the period covered by the said return be taken up as early as practicable and adjust the grant of provisional refund against tax due, if any, as a result of the assessment.

 

(4)        If, on assessment, the provisional refund granted under sub‑section (2) is found to be in excess, then such excess shall be recovered as if it is a tax due from the dealer under this Act and the interest on such tax shall be charged at the rate of eighteen per cent per annum, for the period from the date of grant of provisional refund, till the date of assessment.

38.       Interest on refund

 

(1)        Where refund of any amount of tax becomes due to the dealer by virtue of an order of assessment under section 34, he shall subject to the provision of this section be entitled to receive in addition to the amount of tax, simple interest at the rate of six per cent per annum on the said amount of tax from the date immediately following the date of the closure of the accounting year to which the said amount of tax relates to the date of order of assessment:

 

PROVIDED that where the dealer has paid any amount of tax after the closure of the accounting year and such amount is required to be refunded, no interest shall be payable for the period from the date of closure of such accounting year to the date of payment of such amount.

 

(2)        A registered dealer entitled to refund in pursuance of any order other than referred to under sub‑section (1) or in pursuance of any order by any court, shall, subject to rules, be entitled to receive, in addition to the refund, simple interest at the rate of six per cent for the period commencing after thirty days from the date of such order till the date of payment of amount of such refund. The interest shall be calculated on the amount of refund due after deducting there from any tax, interest, penalty or any other dues under this Act or under the Central Act. If, as a result of any order passed under this Act, the amount of such refund is enhanced or reduced, such interest shall be enhanced or reduced accordingly:

 

PROVIDED that where the amount becomes refundable by virtue of an order of the appellate authority or revision authority or of a court, the interest under the provisions of this section shall be payable from the date immediately following the expiry of the period of thirty days from the date of receipt of the order of the appellate authority or revision authority or the court, by the officer whose order forms the subject‑matter of the proceedings before the appellate authority or revisional authority or the court to the date of refund.

 

Explanation 1: For the purposes of this section, where the refund of tax, whether full or in part, includes refund of any amount of tax paid after the date prescribed for making the last payment of any period covered by the return, then the interest, insofar as it relates to the refund arising from such payment, shall be calculated from the date of such payment to the date of such order.

 

Explanation 2: If the delay in granting the refund within the period of thirty days aforesaid is attributable to the said dealer, whether wholly or in part, the period of the delay attributable to him shall be excluded from the period for which the interest is payable.

 

Explanation 3: Where the refund of a sum deposited as a precondition for entertainment of appeal under sub‑section (4) of section 73 becomes due on account of appeal being decided in dealer's favour, the "date of order" for the purposes of this section shall be

 

(a)        in the case where the case has been remanded by the appellate authority, the date of the order made in pursuance of the order of the appellate authority; and

(b)        in any other case, the date of the order of the appellate authority.

 

(2)        Where the realization of any amount remains stayed by the order of any court or authority and such order is subsequently vacated, interest shall be payable also for any period during which such order remained in operation.

 

39.       Power to withhold refund in certain cases

 

(1)        Where an order giving rise to a refund is the subject‑matter of an appeal or further proceeding or where any other proceeding under this Act is pending, and the Commissioner is of the opinion that grant of such refund is likely to adversely affect the revenue, he may, after giving the dealer an opportunity of being heard, withhold the refund till such time as he may determine.

 

(2)        Where a refund is withheld under sub‑section (1), the dealer shall be entitled to interest as provided under section 38, if as a result of the appeal or further proceeding he becomes entitled to refund.

 

40.       Refund of tax for certain categories

 

(1)        Subject to such terms and conditions as it may impose, the State Government may, if it considers necessary so to do in the public interest, by notification in the Official Gazette, authorize the Commissioner to grant refund of the amount of tax separately charged by any registered dealer to any class of persons who have purchased the goods from such dealer.

 

(2)        Every notification issued under sub‑section (1) shall be laid for not less than thirty days before the State Legislature as soon as possible after it is issued and shall be subject to rescission by the State Legislature or to such modifications as the State Legislature may make, during the session in which it is so laid or session immediately following. Any rescission or modification so made by the State Legislature shall be published in the Official Gazette and shall thereupon take effect.

 

(2)   Any person, so entitled for refund under sub‑section (1) may apply to the prescribed authority in the manner and within the time as may be prescribed. The Commissioner shall subject to provisions of this Act grant such refund to such person.

 

41.       Remission of tax, penalty or interest

 

(1)        Subject to such conditions as it may impose, the State Government may, if it is necessary so to do in the public interest in case of double taxation or to redress an inequitable situation, remit by an order either generally or specially, the whole or any part of the tax, penalty or interest payable in respect of any period by any dealer or a class of dealers or of any specified class of sales or purchase.

 

(2)        The Commissioner may, in such circumstances and subject to such conditions and within such limit as maybe prescribed remit the whole or any part of the tax, penalty or interest payable, in respect of any period, by any dealer.

 

42.       Payment and recovery of tax and interest on delayed payment

 

(1)        The amount of tax assessed, reassessed or becoming payable for any period under section 32,33,34,35,75 or 79, less any amount already paid by the dealer in respect of such period, shall together with penalty and interest if any that may become payable under any of the provisions of this Act, be paid by the dealer or the person liable therefore into a Government treasury or in such other manner as may be prescribed within thirty days from the date of service of notice of demand issued by the Commissioner for this purpose.

 

(2)        On an application by the dealer, the Commissioner may in respect of any particular dealer or person and for reasons to be recorded in writing, extend the time for payment or allow payment by installments, subject to such conditions as he may think fit to impose in the circumstances of the case.

 

(3)        In a case where payment by installments is allowed under sub‑section (2) and the dealer or the person liable for such payment commits default in paying any one of the installments within the time fixed by the Commissioner under that sub‑section, the dealer or the person shall be deemed to be in default in respect of the whole of the amount then outstanding and the other installments shall be deemed to have been due on the same date as the installment in default.

 

(4)        Interest at the rate of eighteen per cent per annum shall be charged for the period as may be extended or the installments as may be granted under sub‑section (2).

 

(5)        If the amount of tax and penalty, if any, is not paid within the time specified in sub‑section (1) or extended under sub‑section (2), as the case may be, the dealer or the person liable therefore shall be deemed to be in default in respect of that amount.

 

(6)        Where the amount of tax assessed or reassessed for any period, under section 34 or section 35, subject to revision, if any, under section 75, exceeds the amount of tax already paid by a dealer for that period, there shall be paid by such dealer, for the period commencing from the date of expiry of the time prescribed for payment of tax under sub‑section (1), (2) or (3) of section 30 and ending on date of order of assessment, reassessment or, as the case may be, revision, simple interest at the rate of eighteen per cent per annum on the amount of tax not so paid or any less amount thereof remaining unpaid during such period.

 

(7)        Where a dealer does not pay the amount of tax falling under sub‑section (1) on or before the prescribed date, then there shall be paid by such dealer for the period commencing on the specified date and ending on the date of payment, simple interest at the rate of eighteen per cent per annum. on the amount of tax not so paid or any less amount thereof remaining unpaid during such period:

 

PROVIDED that where security, other than in the form of surety bond, has been furnished by a dealer under sub‑sections (1) and (2) of section 28, the Commissioner may, for good and sufficient reasons to be recorded in writing, realize any amount of tax, penalty or interest remaining unpaid as aforesaid or part thereof by ordering forfeiture of the whole or any part of the security.

 

43.       Continuation of certain recovery proceedings

 

(1)        Where any notice of demand in respect of any tax, penalty, interest or any other amount payable under this Act (hereinafter in this section referred to as "Government dues") is served upon any dealer and any appeal, revision application is filed or other proceeding is initiated in respect of such Government dues, then

 

(a)        where such Government dues are enhanced in such appeal, revision or other proceeding, the Commissioner shall serve upon the dealer another notice of demand only in respect of the amount by which such Government dues are enhanced and any recovery proceeding in relation to such Government dues as are covered by the notice of demand served upon him before the disposal of such appeal, revision application or proceeding may, without the service of any fresh notice of demand, be continued from the stage at which such proceedings stood immediately before such disposal;

(b)        where such Government dues are reduced in such appeal, revision or in other proceeding

(i)         it shall not be necessary for the Commissioner to serve upon the dealer a fresh notice of demand;

(ii)        the Commissioner shall give intimation of such reduction to him and to the appropriate authority with whom recovery proceeding is pending;

(iii)       any recovery proceedings initiated on the basis of the notice of demand served upon him prior to the disposal of such appeal, revision application or other proceeding may be continued in relation to the amount so reduced from the stage at which such proceedings stood immediately before such disposal.

 

44.       Special mode of recovery

 

(1)        Notwithstanding anything contained in any law or contract to the contrary, the Commissioner may, at any time or from time to time, by notice in writing, a copy of which shall be forwarded to the dealer at his last known address, require,

 

(a)        any person from whom any amount of monies is due, or may become due, to a dealer on whom notice has been served under sub‑section (1), or

(b)        any person who holds or may subsequently hold monies for or on account of such dealer, to pay to the Commissioner, either forthwith upon the monies becoming due or being held or within the time specified in the notice (but not before the monies becomes due or is held as aforesaid) so much of the monies as is sufficient to pay the amount due by the dealer in respect of the arrears of tax, penalty or interest under this Act, or the whole of the money when it is equal to or less than that amount.

 

Explanation : For the purposes of this sub‑section, the amount of monies due to a dealer from, or monies held for or on account of a dealer by any person, shall be calculated by the Commissioner after deducting there from such claims, if any, lawfully subsisting, as may have fallen due for payment by such dealer to such person.

 

(2)        The Commissioner may amend or revoke any such notice or extend the time for making any payment in pursuance of the notice.

 

(3)        Any person making any payment in compliance with a notice under this section shall be deemed to have made the payment under the authority of the dealer, and the receipt thereof by the Commissioner shall constitute a good and sufficient discharge of the liability of such person to the extent of the amount specified in the receipt.

 

(4)        Any person discharging any liability to the dealer after receipt of the notice referred to in this section, shall be personally liable to the Commissioner to the extent of the liability discharged or to the extent of the liability of the dealer for tax, penalty and interest, whichever is less.

 

(5)        Where a person to whom a notice under this section is sent objects to it by a statement in writing that the sum demanded or any part thereof is not due or payable to the dealer or that he does not hold any monies for or on account of the dealer, the Commissioner shall hold an inquiry and after giving to such person or dealer a reasonable opportunity of being heard, make such order as he thinks fit.

 

(6)        Any amount of monies which the aforesaid person is required to pay to the Commissioner, or for which he is personally liable to the Commissioner under this section shall, if it remains unpaid, be recoverable as an arrear of land revenue.

 

(7)        The Commissioner may apply to the court in whose custody there is monies belonging to the dealer for payment of the amount of such monies towards the outstanding amount of tax, interest and penalty payable by the dealer.

 

45.       Provisional attachment

 

(1)        Where during the pendency of any proceedings of assessment or reassessment of turnover escaping assessment, the Commissioner is of the opinion that for the purpose of protecting the interest of the Government 'revenue, it is necessary so to do, he may by order in writing attach provisionally any property belonging to the dealer in such manner as may be prescribed.

 

(2)        Every such provisional attachment shall cease to have effect after the expiry of a period of one year from the date of the order made under sub‑section (1).

 

46.       Special powers of tax authorities for recovery of tax as arrears of land revenue

 

(1)        For the purpose of effecting recovery of the amount of tax, penalty or interest due from any dealer or other person by or under the provisions of this Act or under any earlier law, as arrears of land revenue

 

(i)         the Commissioner, the Special Commissioner, Additional Commissioner and the Joint Commissioners shall have and exercise all the powers and perform all the duties of the Collector under the Bombay Land Revenue Code, 1879.

(ii)        the Deputy Commissioners and Assistant Commissioners shall have and exercise all the powers (except the powers of arrest and confinement of a defaulter in a civil jail) and perform all the duties of the Assistant Collector or Deputy Collector under the said Code.

(iii)       the Commercial Tax Officers shall have and exercise all the powers (except the powers of arrest and confinement of a defaulter in a civil jail) and perform all the duties of the Mamlatdar under the said Code.

 

(2)        Every order passed in exercise of the powers conferred by sub‑5ection (1) shall, for the purpose of section 73, 75, 78, 79 or 94, be deemed to be an order passed under this Act.

 

47.       Transfer to defraud revenue void

 

Where a dealer after any tax has become due from him creates a charge on or parts with the possession by way of sale, mortgage, exchange or any other mode of transfer whatsoever of any of his property in favour of any other person with the intention of defrauding the Government Revenue, such charge or transfer shall be void as against any claim in respect of any tax or any other sum payable by the dealer.

 

48.       Tax to be first charge on property

 

Notwithstanding anything to the contrary contained in any law for the time being in force, any amount payable by a dealer or any other person on account of tax, interest or penalty for which he is liable to pay to the Government shall be a first charge on the property of such dealer, or as the case may be, such person.

 

LIABILITY TO PAY TAX IN CERTAIN CASES

 

49.       Applicability of the Act or earlier law to other persons liable to pay tax

 

Where in respect of any tax, interest or penalty due from a dealer under this Act or under any earlier law, any other person is liable for the payment thereof under any provisions of this Act or earlier law, all the relevant provisions of this Act or, as the case may be, of the earlier law shall, in respect of such liability apply to such person also, as if he were the dealer himself.

 

50.       Liability of commission agent and principal

 

(1)        Where a commission agent purchases or sells any taxable goods on behalf of his principal, such commission agent and his principal shall be jointly and severally liable to pay the tax payable under the Act.

 

(2)        If the commission agent shows to the satisfaction of the Commissioner, in the manner as may be prescribed, that the tax payable by him under this Act in respect of any goods, has been paid by the principal on whose behalf the goods were purchased, the commission agent shall not be liable to pay the tax again in respect of the same transaction.

 

(3)        If the principal, on whose behalf commission agent has sold the goods, shows to the satisfaction of the Commissioner, in the manner as may be prescribed, that the tax payable under this Act in respect of any goods, has been paid by his commission agent, the principal shall not be liable to pay the tax again in respect of the same transaction.

 

51.       Liability in case of transfer of business

 

(1)        Where a dealer, liable to pay tax under this Act, transfers his business in whole or in part, by sale, gift, lease, leave and licence, hire or in any other manner whatsoever, the dealer and the person to whom the business is so transferred shall jointly and severally be liable to pay the tax, interest or any penalty due from the dealer up to the time of such transfer, whether such tax, interest or penalty has been assessed before such transfer, but has remained unpaid or is assessed thereafter.

 

(2)        Where the transferee or the lessee of a business referred to in sub‑section (1) carries on such business either in his own name or in some other name, he shall be liable to pay tax on the sale of goods effected by him with effect from the date of such transfer and shall, if he is an existing dealer, apply within the prescribed time for amendment of his certificate of registration.

 

52.       Amalgamation of companies

 

(1)        When two, or more companies are amalgamated by the order of court or of the Central Government and the order is to take effect from a date earlier to the date of the order and any two or more of such companies have sold or purchased any goods to or from each other during the period commencing on the date from which the order is to .take effect and ending on the date of the order, then such transactions of sale and purchase shall be included in the turnover of sale or purchase of the respective companies and shall be assessed to tax accordingly.

 

(2)        Notwithstanding anything contained in the said order, for all the purposes of this Act, the said two or more companies shall be treated as distinct companies for all the periods up to the date of the said order and the registration certificates of the said companies shall be cancelled, where necessary, with effect from the date of the said order.

 

Explanation: Words and expressions used in this section but not defined shall have the respective meanings assigned to them in the Companies Act, 1956.

 

53.       Liability in case of company in liquidation

 

(1)        Every person

 

(a)        who is a liquidator of any company which is being wound up whether under the orders of a court or otherwise; or

(b)        who has been appointed as receiver of any assets of a company (hereinafter referred to as the "liquidator"),

 

shall, within thirty days after his appointment, give intimation of his appointment as such to the Commissioner.

 

(2)        The Commissioner shall, after making such inquiry or calling for such information as he may deem fit, notify the liquidator within three months from the date on which he received intimation of the appointment of the liquidator, the amount which in the opinion of the Commissioner would be sufficient to provide for any tax, interest or penalty which is then, or is likely thereafter to become, payable by the company.

 

(3)        When any private company is wound up and any tax, interest or penalty assessed under this Act on the company for any period, whether before or in the course of or after its liquidation, cannot be recovered, then every person who was a director of the private company at any time during the period for which the tax is due, shall jointly and severally be liable for the payment of such tax, interest or penalty, unless he proves to the satisfaction of the Commissioner that such non‑recovery is, be attributed to any gross neglect, misfeasance or breach of duty on his part in relation to the affairs of the company.

 

Explanation : For the purposes of this section, the expressions "company" and "private company" shall have the meaning respectively assigned to them under clauses (i) and (ii) of sub‑section (1) of section 3 of the Companies Act, 1956.

 

54.       Liability of partners of firm to pay tax

 

Notwithstanding any contract to the contrary, where any firm is liable to pay any tax, interest or penalty under this Act, the firm and each of the partners of the firm shall jointly and severally be liable for such payment:

 

PROVIDED that where any partner retires from the firm, he shall intimate the date of his retirement to the Commissioner by a notice in that behalf in writing and he shall be liable to pay tax, interest or penalty remaining unpaid at the time of his retirement and any tax, interest or penalty due up to the date of his retirement whether assessed or not assessed, on that date:

 

PROVIDED FURTHER that if no such intimation is given within one month from the date of retirement, the liability of such partner under the first proviso shall continue until the date on which such intimation is received by the Commissioner.

 

55.       Liability of guardians, trustees, etc

 

Where the business in respect of which tax is payable under this Act is carried on by any guardian, trustee or agent of a minor or other incapacitated person on behalf of and for the benefit of such minor or other incapacitated person, the tax, interest or penalty shall be levied upon and recoverable from such guardian, trustee or agent, as the case may be, in like manner and to the same extent as it would be assessed upon and recoverable from any such minor or other incapacitated person, as if he were major and capacitated person and if he were conducting the business himself, and all the provisions of this Art shall, so far as may be, apply accordingly.

 

56.       Liability of courts of wards, etc.

 

Where the estate or any portion of the estate of a dealer owning a business in respect of which tax is payable under this Act is under the control of the Court of Wards, the Administrator General, the Official Trustee or any receiver or manager (including any person, whatever be his designation, who in fact manages the business) appointed by or under any order of a court, the tax, interest or penalty shall be levied upon and be recoverable from such Court of Wards, Administrator General, Official Trustee, receiver or manager as the case may be, in like manner and to the same extent as it would be assessed upon and be recoverable from the dealer as if he were conducting the business himself, and all the provisions of this Act shall, so far as may be, apply accordingly.

57.       Special provision regarding liability to pay tax in certain cases

 

(1)        Where a person who is or has been a dealer, liable to pay tax under this Act, dies, then-

 

(a)        if a business carried on by the dealer is continued after his death by his legal representative or any other person, such legal representative or other person, shall be liable to pay tax, interest or penalty due from such dealer under this Act or under any earlier law, and

(b)        if the business carried on by the dealer is discontinued, whether before or after his death, his legal representative shall be liable to pay out of the estate of the deceased, to the extent to which the estate is capable of meeting the charge, the tax, penalty or interest due from such dealer under this Act or under any earlier law,

 

whether such tax, interest or penalty has been assessed before his death but has remained unpaid or is assessed after his death.

 

(2)        Where a dealer, liable to pay tax under this Act, is a Hindu Undivided Family and the property of the Hindu Undivided Family is partitioned amongst the various members or groups of members then each member or group of members shall jointly and severally be liable to pay the tax, interest or penalty due from the dealer under this Act qr under any earlier law up to the time of the partition whether such tax, penalty or interest has been assessed before partition but has remained unpaid or is assessed after the partition.

 

(3)        Where a dealer, liable to pay tax under this Act, is a film, and the firm is dissolved, then every person who was a partner shall be jointly and severally liable to pay to the extent to which he is liable under section 54, the tax, interest or penalty due from the firm under this Act or under any earlier law, up to the time of dissolution whether such tax, interest or penalty has been assessed before the dissolution, but has remained unpaid or is assessed after dissolution.

 

(4)        Where the dealer liable to pay tax under this Act,

 

(a)        is the guardian of a ward on whose behalf the business is carried on by the guardian, or

(b)        is a trustee who carries on the business under a trust for a beneficiary, then if the guardianship or trust is terminated, the ward or, as the case may be, the beneficiary shall be liable to pay the tax, interest or penalty due from the dealer up to the time of the termination of the guardianship or trust, whether such tax, interest or penalty has been assessed before the termination of guardianship or trust but has remained unpaid or is assessed thereafter.

 

(5)        Where a person becomes liable to pay tax in the manner described in clause (a) of sub‑section (1), then such person shall, (notwithstanding anything contained in section 3), be liable to pay tax on the sales of goods made by him on and after the date of such succession or transfer and shall (unless he already holds a certificate of registration) in the case of succession, within six months and in the case of transfer, within thirty days, thereof apply for registration.

 

58.       Liability in other cases

 

(1)        Where a dealer is a firm or an association of persons or a Hindu Undivided Family and such firm, association or family has discontinued business

 

(a)        the tax payable under this Act, by such firm, association or family up to the date of such discontinuance may be assessed as if no such discontinuance had taken place; and

(b)        every person who was at the time of such discontinuance, a partner of such firm, or a member of such association or family, shall, notwithstanding such discontinuance be liable jointly and severally for the payment of tax assessed and penalty or interest imposed and payable by such firm, association or family, whether such tax, interest or penalty or has been assessed prior to or after such discontinuance, and subject as aforesaid, the provisions of this Act shall, so far as may be, apply as if every such person or partner or member were himself a dealer.

 

(2)        Where a change has occurred in the constitution of a firm or an association of persons, the partners of the firm or members of association, as it existed before and as it exists after its reconstitution, shall, without prejudice to the provisions of section 54, jointly and severally be liable to pay tax, interest and penalty due from such firm or association for any period before its reconstitution.

 

(3)        The provisions of sub‑section (1) shall, so far as may be, apply where the dealer, being a firm or association of persons is dissolved or where the dealer, being a Hindu Undivided Family, has effected partition with respect to the business carried on by it and accordingly references in that sub‑section to discontinuance shall be construed as reference to dissolution or, as the case may be, to partition,

 

59.       Service of notice in certain circumstances

 

(1)        Where a Hindu Undivided Family has been partitioned, notice under this Act shall be served on the person who was the last manager of the Hindu Undivided Family, or if such person cannot be found, then on all adults who were members of the Hindu Undivided Family, immediately before the partition.

 

(2)        Where a firm or an association of persons is dissolved, notice under this Act may be served on any person who was a partner (not being a minor) of the firm, or member of the association, as the case may be, immediately before its dissolution.

 

(3)        Where the business of a firm, an association of persons or company has been discontinued, a notice under this Act shall be served in the case of a firm or an association of persons on any person who was a member of such firm or association at the time of its discontinuance and in the case of a company, on the principal officer thereof.

           

ACCOUNTS AND RECORDS

 

60.       Invoices

 

(1)        A registered dealer who sells taxable goods to another registered dealer, shall, at the request of the purchaser, provide to him, at the time of sale, with a tax invoice containing such particulars as may be prescribed and retain a copy thereof:

 

PROVIDED that a tax invoice shall not be issued by a dealer

 

(a)        in respect of the goods specified in Schedule I or exempt by notification under sub‑section (2) of section 5;

(b)        who has given an option to pay lump sum tax in lieu of tax under section 14;

(c)        for sale in the course of inter‑State trade or commerce or export out of the territory of India; or

(d)        to a person who is not a registered dealer.

 

(2)        Except when tax invoice is issued under sub‑section (1), if a registered dealer sells any goods exceeding rupees one hundred in value in any one transaction to any person, he shall issue to the purchaser a retail invoice, containing such particulars as may be prescribed and retain a copy thereof.

 

61.       Credit and debit notes

 

Subject to the provisions of sections 8 and 60, where a tax invoice has been provided as contemplated in sub‑section (1) of section 60, and

 

(a)        the amount shown as tax charged in the tax invoice exceeds the actual tax charged in respect of the sale concerned, the seller shall provide the purchaser with a credit note within three months of the sales of goods involved in the transaction, containing such particulars as may be prescribed;

 

(b)        the actual tax charged in respect of the sale concerned exceeds the tax shown in the tax invoice as charged, the seller shall provide the purchaser with a debit note, containing such particulars as may be prescribed:

 

PROVIDED that­

 

(i)         not more than one credit note or, as the case may be, debit note shall be issued for the amount in excess;

(ii)        no credit note shall be issued for the amount in excess which arises when the purchaser avails of the discount offered by the seller.

 

62.       Accounts

 

(1)        Every dealer liable to pay tax under this Act, and every other dealer on whom a notice has been served to furnish returns under sub‑section (2) of section 29 shall maintain at his place of business a true account of the value of goods purchased, sold, supplied and delivery of goods made by him in such form and in such manner as may be prescribed.

 

(2)        If the Commissioner considers that such account is not sufficiently clear and intelligible to enable him to make a proper scrutiny of the returns referred to in section 29, he may require such dealer by notice in writing to keep such accounts (including records of purchases and sales) in such form and in such trianner as may be specified therein.

 

(3)        The Government may, direct any class of registered dealers generally to keep such accounts (including records of purchases and sales) in such manner as may be prescribed.

 

63.       Accounts to be audited in certain cases

 

(1)        If in respect of any particular year, total turnover of a dealer exceeds rupees one core, then such dealer shall get his accounts verified and audited by a specified authority within one year from the end of that year and obtain within that period a report of such audit in the prescribed form duly signed and verified by such specified authority along with such particulars as may be prescribed. A true copy of such report shall be furnished by such dealer to the Commissioner within such period as may be prescribed.

 

Explanation : For the purposes of this section, "specified authority" means,-

 

(i)         a Chartered Accountant within the meaning of the Chartered Accountants Act, 1949 and includes persons who by virtue of the provisions of sub‑section (2) of section 226 of the Companies Act, 1956, is entitled to be appointed to act as an auditor of companies;

(ii)        a Cost Accountant within the meaning of the Cost and Works Accountants Act, 1959;

(iii)       a legal practitioner or a sales tax practitioner whose name is entered in the list maintained by the Commissioner in accordance with the provisions of section 81.

 

(2)        If any dealer liable to get his accounts audited under sub‑section (1) fails to furnish a true copy of such report within the prescribed time, the Commissioner shall, after giving the dealer a reasonable opportunity of being heard, impose on him, in addition to any tax payable, a sum by way of penalty not exceeding rupees ten thousand, as he may determine.

 

64.       Preservation of records

 

The dealer shall preserve his books of accounts and the records relevant for the purpose of this Act till the period of eight years from the end of the accounting year to which the books of accounts and the records relate.

 

 

LIABILITY TO PRODUCE ACCOUNTS AND SUPPLY OF INFORMATION

 

65.       Dealer to declare the name of manager of business

 

Every registered dealer shall within the period prescribed, file a declaration in the manner prescribed stating the name of the person or persons who shall be deemed to be the manager or managers of business of such dealer, for the purposes of this Act and in the event of change of manager, the dealer shall revise the declaration within thirty days from the date of such change.

 

66.       Dealer to declare details of bank accounts

 

Every dealer, who is liable to pay tax shall send a declaration in such form, within such period and to such authority as may be prescribed, stating therein the particulars of the bank accounts operated by him in connection with his business and shall within the period prescribed, intimate to the authority the changes in the particulars in the declaration.

 

67.       Production and inspection of accounts and documents and search of premises

 

(1)        The Commissioner may, subject to such conditions as may be prescribed, require any dealer or any other person

 

(a)        to produce before him such books of account, registers or documents;

(b)        to furnish such information relating to the stock of goods, purchases, sales, deliveries of goods by the dealers or any other information relating to his business, as may be deemed necessary, for the purposes of this Act.

 

(2)        All books of account, registers and documents relating to the stock of goods, purchases, sales and deliveries of goods by any dealer; and all goods kept in any place of business or warehouse of any dealer, or at any other place for and on behalf of a dealer, shall at all reasonable time be open to inspection by the Commissioner. The Commissioner may take or cause to be taken such copies or extracts of the said books of account, registers or documents and such inventory of the goods found as appear to him necessary for the purposes of this Act.

 

(3)        Where the Commissioner, has reason to believe that

 

(a)        any person to whom a notice under this Act was issued to produce or cause to be produced, any books of account or other documents has failed to produce or cause to be produced such books of account or other documents as required by such notice; or

(b)        any person to whom a notice as aforesaid has been or might be issued, will not, or would not, produce or cause to be produced any books of account or other documents which will be useful for, or relevant to, any proceeding under the earlier law or under this Act; or

(c)        books of account, registers or documents of any dealer may be destroyed, mutilated, altered, falsified or any sale or purchase by that dealer have been or may be suppressed, or any goods have not been or may not be accounted for in the books of account, registers or other documents required to be maintained under this Act, with a view to evade or attempt to evade payment of tax due under the earlier law or under this Act,

 

the Commissioner or any other person appointed under sub‑section (2) of section 16 if so authorized by him, may,

 

(i)         enter and search any building or place where he has reason to suspect that the books of account and other documents or the goods or the sale proceeds are kept;

(ii)        break open the lock of any door, box, locker, safe, or other receptacle for exercising the powers conferred by sub‑clause (i) where the keys thereof are not available;

(iii)       seize any such books of account or other documents or any inventory of goods or any goods as appear to him necessary for the purposes of this Act;

(iv)       place marks of identification on any books of account or other documents or make or cause to be made extracts or copies there from;

(v)        make a note or any inventory of any such money or goods found as a result of such search or place marks of identification on such goods;

(vi)       seal the premises including the office, shop, godown, box, locker, safe, almirah or other receptacle if the owner or the person in occupation or in‑charge of such office, shop, godown, box, locker, safe, almirah or other receptacle leaves the place or is not available or fails or refuses to open it when called upon to do so, or causes or attempts to cause obstruction to the Commissioner or the authorized officer in the discharge of his duties under this section.

 

(4)        The Commissioner may requisition the services of any police officer or any public servant, or of both to assist him for all or any of the purposes specified in sub‑section (3).

 

(5)        Where the Commissioner seizes any books of account or other documents or any goods, he shall give the dealer or the person present on his behalf a receipt for the same and obtain acknowledgement of the receipt so given to him:

 

PROVIDED that if the dealer or person from whose custody the books of account or other documents or the goods are seized refuses to give an acknowledgement, the Commissioner may leave the receipt at the premises and record the fact.

 

(6)        Where it is not feasible to seize the accounts or other documents or the goods under sub‑section (3), the Commissioner or the authorized officer, may serve on the owner or the person who is in immediate possession or control thereof, an order that he shall not remove or part with or otherwise deal with them except with the previous permission of the Commissioner or such authorized officer.

 

(7)        The Commissioner shall keep in his custody the books of account, registers or documents seized under sub‑section (3) for such period not later than the completion of all the proceedings under this Act in respect of the years for which those books of account, registers or documents are relevant, as he considers necessary, and thereafter shall return the same to the dealer or any other person from whose custody or power they were seized:

 

PROVIDED that the Commissioner may, before returning such books of account or other documents as aforesaid, place or cause to be placed such marks of identification thereon as appear to him to be necessary:

 

PROVIDED FURTHER that the Commissioner may, before returning the books of account and other documents, require that the dealer or the person, as the case may be, shall give written undertaking that the books of account and other documents shall be presented whenever required by any competent authority for any proceedings under this Act.

 

(8)        Save as otherwise provided in this section, every search or seizure made under this section shall be carried out in accordance with the provisions of the Code of Criminal Procedure, 1973 relating to searches or seizures made under that Code.

 

(9)        The Commissioner may, for the purposes of this Act,

 

(a)        require any person, including a banking company, post office or any officer thereof, to furnish information in relation to such matters or to furnish statements of accounts and affairs verified in the manner specified by him, giving information in relation to such points or matters as in his opinion will be useful for, or relevant to, any proceeding under this Act;

(b)        require any person­-

(i)         who transports or holds in custody, for delivery to or on behalf of any dealer any goods to give any information likely to be in his possession in respect of such goods or to permit inspection thereof, as the case may be;

(ii)        who maintains or has in his possession any books of account, registers or documents relating to the business of a dealer to produce such books of account, registers or documents for inspection,

 

(10)      If any person, who transports or holds in custody for delivery to or on behalf of any dealer any goods, on being required by the Commissioner under sub‑clause (i) of clause (b) of sub‑section (9) so to do, fails to furnish the information likely to be in his possession in respect of such goods or fails to permit inspection thereof the Commissioner may pass an order of detention or seizure of goods in his custody or possession in respect of which the default is committed.

 

(11)      The order of detention or seizure passed under sub‑section (10) shall remain in force so long as the person concerned does not furnish information required under sub‑clause (i) of clause (b) of sub‑section (9) or make proper arrangement for inspection of the goods under the said sub‑section.

 

(12)      If any person, who transports or holds in custody for delivery to or on behalf of any dealer any goods, on being required by the Commissioner under sub‑clause (i) of clause (b) of sub‑section (9) so to do, fails to give any information likely to be in his possession in respect of such goods or fails to permit inspection thereof without prejudice to any other action which may be taken against such person, a ‑presumption may be raised that the goods in respect of which he has failed to furnish information or permit inspection, were meant for sale by him and he is a dealer liable to pay tax under this Act and the provisions of this Act shall apply accordingly.

 

(13)      If any person commits default under clause (a) or sub‑clause (ii) of clause (b) of sub‑section (9), the Commissioner may, without prejudice to any other action which may be taken against such person under any other provision of this Act, direct, after giving an opportunity of being heard to such person that such person shall pay by way of penalty a sum not exceeding rupees fifty thousand.

 

(14)      If the Commissioner is satisfied that any person on being required by him so to do, has failed to furnish the information in respect of the goods in his custody for delivery to or on behalf of any dealer or to permit inspection thereof under sub‑clause (i) of clause (b) of sub‑section (9), the Commissioner may, by order in writing and after giving opportunity of being heard to such person, impose by way of penalty a sum not exceeding the amount of tax leviable under this Act on the goods in respect of which the default was committed.

 

(15)      Where an order of detention or seizure of goods is made under the provisions of this section, the Commissioner or the officer authorized in this behalf may release the goods on such person exercising the option of paying by way of penalty such sum as may be directed, not exceeding two and a half times the amount of tax leviable on such goods under this Act.

 

(16)      Where any premises including the office, shop, godown, box, locker, safe or other receptacle have been sealed under sub‑section (3), the Commissioner, on an application made by the owner or the person in occupation or in‑charge of such shop, godown, box, locker, safe, or other receptacle, may order de‑sealing thereof on such terms and conditions, including furnishing of security for such sum in such form and manner as may be prescribed.

 

(17)      Where an order of detention or seizure of goods is made under this section and no claim is lodged by any person with respect to such goods within a period of three months from the date of such order, the Commissioner may, by order in writing, direct the auction of such goods:

 

PROVIDED that if the goods, in respect of which an order of detention or seizure is made, are of a perishable nature or subject to speedy and natural decay or when the expenses of keeping them in custody are likely to exceed their value, the same may be ordered to be auctioned as soon as it is practicable soon after an order of detention or seizure of such goods is made and the amount so realized by the auction of goods shall be remitted in the Government treasury immediately.

 

(18)      Where an order imposing penalty is passed under sub‑section (14) or an option of paying penalty is exercised under sub‑section (15) and the person liable fails to pay the penalty within the prescribed period, the goods detained or seized may be sold by public auction and the sale proceeds deposited immediately in Government treasury.

 

(19)      Auction of goods to be made under sub‑section (17) or sub‑section (18) shall be carried out in the manner as may be prescribed.

 

(20)      Any person entitled to the sale proceeds of goods auctioned under the provisions of this section shall, on application made to the Commissioner and upon sufficient proof, be paid the sale proceeds of the goods auctioned, after deducting there from the expenses of the sales and other incidental charges and the amount of tax, interest and penalty leviable under this Act.

 

68.       Inspection of goods in transit, etc.

 

(1)        If the State Government considers that with a view to preventing evasion of tax in any place or places in the State, it is necessary to so do; it may, by notification in the Official Gazette, direct that such number of check‑posts shall be set up or such number of barriers shall be erected at such places as may be specified in the notification.

 

(2)        At every check‑post or barrier set up or erected under sub‑section (1), the driver or any other person‑in‑charge of any vehicle, boat or animal shall stop the same, and keep it stationary so long as may reasonably be necessary, and allow the officer‑incharge of the check‑post or barrier to examine the contents in the vehicle or boat or on the animal and inspect all records relating to the goods carried in the vehicle or boat or on the animal which are in the possession of such driver or other person‑in‑charge who shall, if so required, give his name and address and the names and addresses of the owner of the vehicle, boat or animal as well as of the consignor and consignee of such goods; and where any of the consignor or consignee is a dealer registered under this Act or the Central Sales Tax Act, 1956 or relevant Act in any other State, the driver or any other person‑in‑charge of the vehicle, boat or animal shall also give the number and place of issue of the certificate of registration, if any, of such dealer.

 

(3)        The driver or other person‑in‑charge of a vehicle, boat or animal carrying goods shall

 

(a)        carry with him a log book, a bill of sale or delivery note and such other documents relating to the goods carried in the vehicle or boat or on the animal and containing such particulars as may be prescribed and the driver or person‑in‑charge of a transport vehicle shall, in addition, carry a goods vehicle record and a trip sheet;

(b)        produce the same when requested to do so by the officer‑in‑charge of the check‑post or barrier;

 

(g)        give to the officer‑in‑charge of the check‑post or barrier a declaration relating to particulars of the goods carried in the vehicle or boat or on the animal in such form as may be prescribed and keep one copy of declaration with him.

 

(4)        If the officer‑in‑charge of the check‑post or barrier is of the opinion that­

 

(i)         goods under transport are not covered by goods vehicle record, trip sheet or log book, or

(ii)        goods under transport are not in accordance with the documents prescribed under clause (a) of sub‑section (3), or

(iii)       a declaration relating to particulars of goods as made under clause (c) of sub‑section (3) is false,

 

he may, after recording the reasons, seize such goods and vehicle and give receipt thereof to the person from whose possession or control, the goods or vehicle are seized.

 

(5)      (a)         The officer‑in‑charge of the check‑post or barrier may, after giving the owner, driver or person‑in‑charge of goods, a reasonable opportunity of being heard and after holding such further inquiry, as he deems fit, impose on him penalty, in addition to tax payable under this Act, not exceeding one and one‑half times of the tax for possession of goods or vehicle so seized.

(b)        The officer‑in‑charge of the check‑post or a barrier may release any of the goods, vehicle or documents so seized under sub‑section (4) on payment of tax, interest and penalty or on furnishing such security in such form as may be prescribed.

 

(6)        The officer‑in‑charge of the check‑post or barrier may, during inspection and verification of goods under transport including the documents and records relating thereto, direct the carrier not to part with the goods including re‑transporting or re‑booking until verification of goods, records and documents is done or inquiry, if any, is completed.

 

Explanation: In this section­

 

(a)        "goods vehicle record" means the documents required to be carried by the dealer of a transport vehicle under the Motor Vehicles Act, 1988 or the rules made thereunder;

(b)        "logbook" means a register, statement or other record containing particulars of the goods under transport;

(c)        "trip sheet" means a sheet or other document containing particulars relating to the trip‑wise use of a transport vehicle, required to be carried by the driver under the Act referred to in clause (a);

(d)        "goods under transport" means goods which have been handed over to a carrier and complete delivery thereof has not been taken from such carrier;

(e)        "carrier" means any person or agency who undertakes to carry or transport goods from one place to another.

 

69.       Transit pass for transit of goods by road through the State

 

(1)        Where a vehicle, boat or animal carrying goods coming from any place outside the State is bound for any other place outside the State, the driver or any other person‑in‑charge of such vehicle, boat or animal shall obtain in the prescribed manner a transit pass for such vehicle, boat or animal from the officer‑in‑charge of the first check‑post or barrier after his entry into the State and deliver the same to the officer‑incharge of the last check‑post or barrier before his exit from the State.

 

(2)        If the driver or person‑in‑charge of such vehicle, boat or animal fails to deliver such transit pass, or goods in vehicle, boat or animal are not found in accordance with the transit pass, at the place of exit from State, it shall be presumed that goods carried thereby are sold within the State and he shall be liable to pay tax and penalty not exceeding one and one‑half times the amount of tax as may be determined, after giving a reasonable opportunity of being heard, on such sale in accordance with provisions of this Act.

 

70.       Furnishing of information by owners of cold storage, warehouses, godowns, etc.

 

(1)        Notwithstanding anything to the contrary contained in any law for the time being in force every owner or lessee of a cold storage, warehouse, godown or any such place, who stores therein taxable goods for hire or reward shall maintain or cause to be maintained a correct and complete account indicating the full particulars of the person whose goods are stored in such places and the quantity, value and date of delivery of such goods.

 

(2)        Such accounts shall, on demand, be produced before the Commissioner or any officer authorized in this behalf who may take or cause to be taken such extracts therefrom or require such extracts to be furnished as he may consider necessary.

 

(3)        If any owner or lessee of a cold storage, warehouse, godown or any other such place, who stores goods for hire or reward, contravenes any of the provisions of sub‑section (1) or sub‑section (2) in a manner likely to lead to evasion of any tax payable under this Act, the Commissioner may, without prejudice to any other action which may be taken against such owner or lessee under any other provision of this Act direct, after giving an opportunity of being heard, that such owner or lessee shall pay by way of penalty not exceeding the amount of tax leviable on the goods in respect of which default is committed under sub‑section (1) or (2).

 

71.       Power to collect statistics

 

(1)        If the Government considers that for the purposes of better administration of this Act, it is necessary so to do, it may by notification in the Official Gazette, direct that statistics be collected relating to any matter dealt with, by or under this Act.

 

(2)        Upon such direction being made, the Commissioner may, by notice in any newspaper or in such other manner as he deems fit to bring to the notice of dealers, call upon any class of dealers to furnish such information or statements as may be stated in such notice relating to any matter in respect of which statistics are to be collected. The form in which, the persons to whom or, the authorities to which, such information or returns should be furnished and the intervals at which such information or returns should be furnished, shall be such as may be prescribed.

 

(3)        Without prejudice to the generality of the provisions of this Act, the State Government may by rules provide that every registered dealer or any class of registered dealer shall furnish such statements as may be prescribed.

 

72.       Special powers for reconstitution of records in certain circumstances

 

(1)        If the Commissioner is satisfied that any records pertaining to a dealer have been destroyed as a result of fire or any natural or other calamity or event, he may by notice in writing, require the dealer to appear before him on a date and at such place .specified in the notice, or to produce before him any accounts or registers or documents or copies thereof or to furnish fresh returns under this Act or earlier law for such period, by such dates and to such authority as may be specified in the notice (being returns for a period for which the dealer has not yet been assessed), or to furnish true copies of or extracts from any documents already submitted to the Commissioner, on or before the date specified in the notice, or to furnish any other information relating to the business of the dealer as may be specified in the notice, being information which the Commissioner considers necessary for facilitating the work of assessment or reassessment or the collection of the tax from such dealer under this Act or under earlier law.

 

(2)        Without prejudice to the generality of the powers conferred by sub‑section (1), the Commissioner may require the dealer to produce for inspection to or furnish copies of or extracts from all or any of the following, namely:

 

(a)    application for the issue of a certificate of registration made under this Act;

(b)   certificate of registration granted to the dealer;

(c)        returns furnished by the dealer;

(d)        proof of payment of tax and penalty by the dealer;

(e)        a certified copy of the assessment order given to the dealer; (f) any notice of demand served on the dealer;

(g)        specimen signature furnished by a dealer;

(h)        any nomination made by a dealer.

 

(3)        For securing compliance with any notice given under this section, the Commissioner shall have all the powers specified in section 67.

 

(4)        Where any person is prosecuted for failure to comply with any requirement made of him under this section, the burden of proving that he had reasonable excuse for such failure shall be on him.

                                   

APPEAL, REVISION, REFERENCE AND RECTIFICATION

 

73.       Appeal

 

(1)        An appeal from every original order, not being an order mentioned in section 74, passed under this Act or the Rules, shall lie,

 

(a)        if the order is made by an Assistant Commissioner or Commercial Tax Officer, or any other officer subordinate thereto, to the Deputy Commissioner;

(b)        if the order is made by a Deputy Commissioner, to the Joint Commissioner;

(c)        if the order is made by a Joint Commissioner, Additional Commissioner, or Commissioner, to the Tribunal.

 

(2)        In the case of an order passed in appeal by a Deputy Commissioner or, as the case may be, by a joint Commissioner, a second appeal shall lie to the Tribunal.

 

(3)        Subject to the provisions of section 84, no appeal shall be entertained unless it is filed within sixty days from the date of communication of the order appealed against.

 

(4)        No appeal against an order of assessment shall ordinarily be entertained by an appellate authority, unless such appeal is accompanied by satisfactory proof of payment of the tax in respect of which an appeal has been preferred:

 

PROVIDED that an appellate authority may, if it thinks fit, for reasons to be recorded in writing, entertain an appeal against such order on production of proof of payment of twenty per cent of the amount of tax payable under such order.

 

(5)        The Commissioner, on receipt of notice that an appeal against the order passed in appeal by the Deputy Commissioner or, as the case may be, by the joint Commissioner has been preferred by the other party to the Tribunal may, within thirty days of receipt of the notice, file a memorandum of cross‑objection. against any part of the order passed in appeal by the Deputy Commissioner or, as the case may be, by the Joint Commissioner and such memorandum shall be disposed of by the Tribunal as if it were an appeal.

 

(6)        Subject to such rules of procedure as may be prescribed, an appellate authority may pass such order on appeal as it deems just and proper.

 

(7)        Every order passed in appeal under this section shall, subject to the provisions of sections 75, 78 and 79, be final.

 

74.       Non‑appeasable orders

 

No appeal or no application for revision shall lie against,

 

(a)        a notice issued under this Act calling upon a dealer for assessment or asking a dealer to show cause as to why he should not be prosecuted for an offence under this Act; or

(b)        an order of the Commissioner under sub‑section (1) of section 17; or

(c)        an order pertaining to the seizure or retention of books of account, register and other documents; or

(d)        an order sanctioning prosecution under this Act; or

(e)        an interim order in the course of any proceedings under this Act.

 

75.       Revision

           

(1)        Subject to the provisions of section 74 and to any rules made thereunder,

 

(a)        the Commissioner of his own motion within three years or on an application made to him within one year from the date of any order passed by any officer appointed under section 16 to assist him, may call for and examine the record of any such order and pass such order thereon as he thinks just and proper within two years from the date of service of notice for revision;

(b)        the Tribunal, on application made to it against an order of the Commissioner [not being an order passed under sub‑section (2) of section 73 in second appeal or under clause (a) in revision on an application] within four months from the date of the communication of the order may call for and examine the record of any such order, and pass such order thereon as it thinks just and proper.

 

(2)        Where an appeal lies under section 73 and no appeal has been filed, no proceedings in revision under this section shall be entertained upon application:

 

PROVIDED that the proceedings in revision may be entertained upon an application where the applicant satisfies the Commissioner that he had sufficient cause for not preferring an appeal against the order in respect of which an application for revision is made.

 

(3)        No order shall be passed under this section, which adversely affects any person, unless such person has been given reasonable opportunity of being heard.

 

(4)        Where the Commissioner or the Tribunal rejects any application for revision under this section, the Commissioner or, as the case may be, the Tribunal shall record the reasons for such rejection.

 

76.       Court‑fee on appeal and application for revision

 

Notwithstanding anything contained in the Bombay Court‑fees Act, 1959, an appeal preferred under section 73 and an application for revision made under section 74 shall bear a court‑fee stamp of such value as may be prescribed.

 

77.       Applications of sections 4 and 12 of Limitation Act, 1963

 

In computing the period laid down under sections 73, 75 and 78, the provisions of sections 4 and 12 of Limitation Act, 1963 shall, so far as may be, apply.

 

78.       Statement of case to the High Court

 

(1)        Any person or the Commissioner, within ninety days from the date of the communication of the order of the Tribunal, passed in appeal or revision, being an order which affects the liability of any person to pay tax, interest or penalty, or which affects the recovery from such person of any amount under section 44, may, by application in writing (accompanied, where the application is made by that person, by a fee of one hundred rupees) require the Tribunal to refer to the High Court any question of law arising out of such order; and where the Tribunal agrees, the Tribunal shall, as soon as may be, after the receipt of such application, draw up a statement of the case and refer it to the High Court:

 

PROVIDED that if in the exercise of its power under this sub‑section, the Tribunal refuses to state the case which has been required to do on the ground that no question of law arises, that person, or as the case may be, the Commissioner may, within thirty days of such refusal either withdraw his application or apply to the High Court against such refusal.

 

(2)        If the High Court, upon receipt of an application under sub‑section (1), is not satisfied as to the correctness of the decision of the Tribunal, it may require the Tribunal to state the case and refer to it, and accordingly, on receipt of any such requisition, the Tribunal shall state the case and refer it to the High Court.

 

(3)        If the High Court is not satisfied that the statements in the case referred under this section are sufficient to enable it to determine the question raised thereby, it may refer the case back to the Tribunal to make such addition thereto or alterations therein, as the High Court may direct in that behalf.

 

(4)        The High Court upon the hearing of any such case, shall decide the question of law raised thereby, and shall deliver its judgment thereon containing the grounds on which such decision is founded, and shall send to the Tribunal a copy of such judgment under the seal of the court and the signature of the Registrar, and the Tribunal shall dispose of the case accordingly.

 

(5)        Where a reference is made to the High Court under this section, the costs including the disposal of the fee referred to in sub‑section (1), shall be in the discretion of the Court.

 

(6)        The payment of the amount of the tax, if any, due in accordance with the order of the Tribunal in respect of which an application has been made under sub‑section (1) shall not be stayed pending the disposal of such application or any reference made in consequence thereof, but if such amount is reduced as a result of such reference, the excess tax paid shall be refunded in accordance with the provisions of section 36.

 

79.       Rectification of mistakes

 

(1)        The Commissioner may at any time within two years from the date of the communication of the order passed by him, to the person affected by such order, on his own motion, rectify any mistake of fact apparent from the record, and shall within a like period rectify any such mistake which has been brought to his notice by any person affected by such order:

 

PROVIDED that, no such rectification shall be made if it has the effect of enhancing the tax or reducing the amount of refund or tax credit, unless the Commissioner has given notice in writing to such person of his intention to do so and has allowed such person a reasonable opportunity of being heard.

 

(2)        The provisions of sub‑section (1) shall apply to the rectification of a mistake by the Tribunal or an appellate authority under section 73 as they apply to the rectification of a mistake by the Commissioner.

 

(3)        Where any such rectification has the effect of reducing the amount of the tax, interest or penalty, the Commissioner shall, in the prescribed manner, refund any amount due to such person.

 

(4)        Where any such rectification has the effect of enhancing the amount of the tax or penalty or reducing the amount of refund, the Commissioner shall recover the amount due from such person in accordance with the provisions of the Act.

 

80.       Determination of disputed questions

 

If any question arises, otherwise than in proceedings before a court, or proceedings under section 33, 34 or 35, whether for the purposes of this Act

 

(a)        any person, society, club or association or any firm or any branch or department of any firm is a dealer, or

(b)        any particular thing done to any goods amounts to or results in the manufacture of goods within the meaning of that term, or

(c)        any transaction is a sale or purchase, or

(d)        any particular dealer is required to be registered, or

(e)        any tax is payable in respect of any particular sale or purchase or if tax is payable the rate thereof, or

(f)         any tax credit is admissible under section 11 or section 12, the Commissioner shall make an order determining such question.

 

(2)        The Commissioner may direct that the determination shall not affect the liability of any person under this Act, with respect to any sale or purchase effected prior to the determination.

 

(3)        If any such question arises from any order already passed under this Act or under the earlier law, no such question shall be entertained for determination under this section, but such question may be raised in appeal against, or by way of revision of such order.

 

PROCEEDINGS

 

81.       Appearance before any authority in proceedings

 

(1)        Any person, who is entitled or required to attend before any authority in connection with any proceedings under this Act, may attend,

 

(a)        by a person authorized by him in writing in this behalf, being a relative or a person regularly employed by him; or

(b)        by a legal practitioner or Chartered Accountant or Cost Accountant who is not disqualified by or under sub‑section (2); or

(c)        by a sales tax practitioner who possesses the prescribed qualifications and is entered in the list, which the Commissioner shall maintain in that behalf, and who is not disqualified by or under sub‑section (27.

 

(2)        The Commissioner may, by order in writing and for reasons to be recorded therein, disqualify for such period as is stated in the order from attending before any such authority, any legal practitioner, Chartered Accountant, Cost Accountant or sales tax practitioner

 

(a)        who has been removed or dismissed from Government service; or

(b)        who being a legal practitioner or Chartered Accountant or Cost Accountant is found guilty of misconduct in connection with any proceedings under this Act by an authority empowered to take disciplinary action against the members of the profession to which he belongs; or

(c)        who being a sales tax practitioner is found guilty of such misconduct by the Commissioner.

 

(3)        No order of disqualification shall be made in respect of any particular person unless he has been given a reasonable opportunity of being heard.

 

(4)        Any person against whom an order of disqualification is made under this section may, within one month of the date of communication of such order, appeal to the State Government and the State Government may pass such order in appeal as it may think fit.

 

(5)        The order of the Commissioner shall not take effect until one month of the making thereof or when an appeal is preferred, until the appeal is decided.

 

(6)        The Commissioner may at any time suo motu. or on an application made to him in this behalf, revoke any order made against any person under sub‑section (2) and thereupon such person shall cease to be disqualified.

 

82.       Power of Commissioner and other authorities to take evidence on oath, etc.

 

(1)        The Commissioner or any person appointed under sub‑section (2) of section 16 to assist him shall, for the purposes of this Act, have the same powers as are vested in a court under the Code of Civil Procedure, 1908, when trying a suit, in respect of the following matters, namely,

 

(a)        enforcing the attendance of any person and examining him on oath or affirmation; and

(b)        compelling the production of accounts and documents; and

(c)        issuing commissions for the examination of witnesses.

 

(2)        Any proceeding under this Act before the Commissioner or any person appointed under sub‑section (2) of section 16 to assist him shall be deemed to be a judicial proceeding within the meaning of sections 193 and 228 and for the purposes of section 196 of the Indian Penal Code, 1860.

 

(3)        Subject to any rules made in this behalf, any authority referred to in sub‑section (1) may impound and retain in its custody for such period as it thinks fit, any books of account or other documents produced before it in any proceedings under this Act:

 

PROVIDED that a person appointed under sub‑section (2) of section 16 to assist the Commissioner shall not impound any books of account or other documents without recording his reasons for doing so and retain in his custody any such books or documents for a period exceeding thirty days without obtaining the approval of the Commissioner therefore.

 

83.       Change of an incumbent of an office

 

Whenever in respect of any proceeding under this Act, the Commissioner or any person appointed under sub‑section (2) of section 16 to assist him, ceases to exercise jurisdiction and is succeeded by another person who has and exercises jurisdiction, the person so succeeding may continue the proceeding from the stage at which the proceeding was left by his predecessor:

 

PROVIDED that the dealer concerned may demand that before the proceeding is so continued, the previous proceeding or any part thereof be reopened or that before any order of assessment is passed against him, he shall be reheard.

 

84.       Extension of period of limitation in certain cases

 

An appellate authority may admit any appeal or permit the filing of a memorandum of cross‑objections under section 73 and the Tribunal may admit an application under section 75 or under section 78 after the period of limitation laid down in the said sections, if the appellant or the applicant satisfies the appellate authority or the Tribunal, as the case may be, that he had sufficient cause for not preferring the appeal or filing a memorandum of cross‑objections or making the application, within such period.

 

OFFENCES AND PENALTIES

 

85.       Offences and penalties

 

(1)        Whoever,

 

(a)        not being a registered dealer, falsely represents that he is or was a registered dealer at the time when he sells or purchases goods;

(b)        knowingly furnishes a false return where the amount of tax, which could have been evaded if the false return had been accepted as true, exceeds Rs. 1,000;

(c)        knowingly produces before the Commissioner, false tax invoice, bill, voucher, cash‑memorandum, declaration, certificate or other document for claiming deduction or tax credit, the value of which exceeds Rs. 1,000;

(d)        fails to pay tax as per the returns filed by him;

(e)        knowingly keeps or produces false account;

(f)         issues to any person certificate or declaration under this Act, or an invoice, bill, cash‑memorandum, voucher or other document which he knows or has reason to believe to be false,

(g)        willfully attempts, in any manner whatsoever, to evade tax leviable under this Act,

 

shall on conviction, be punished with imprisonment for a term which shall not be less than six months but which may extend to three years and with fine of rupees twenty thousand.

 

(2)        Whoever-

 

(a)        carries on business as dealer without being registered in contravention of section 21; or

(b)        fails without sufficient cause to furnish any information required by section 26;or

(c)        fails to surrender his certificate of registration as provided in sub‑section (9) of section 27; or

(d)        fails without sufficient cause to furnish any returns as required by section 29 by the date and in the manner prescribed; or

(e)        without reasonable cause, contravenes any of the provisions of section 31; or

(f)         fails without sufficient cause, when directed so to do under section 62 to keep any accounts or record, in accordance with the directions; or

(g)        fails without sufficient cause, to comply with any requirements made of him under section 67, or obstructs any officer making inspection or search or seizure under that section; or

(h)        obstructs or prevents any officer performing any function under this Act; or

(i)         being owner or in‑charge of a goods vehicle fails, neglects or refuses to, comply with any of the requirements contained in section 67 or 68;

 

(j)         issues to another registered dealer tax invoice, retail invoice, bill or cash memorandum with the intention to defraud the Government revenue or with the intention that the Government may be defrauded of its revenue,

 

shall, on conviction, be punished with imprisonment for a term which may extend to one year and with fine of rupees twenty thousand.

 

(3)        Subject to the provision of section 97, if any Government servant discloses any particulars referred to in sub‑section (1) of section 92, he shall, on conviction, be punished with imprisonment for a term which may extend to six months and with fine.

 

(4)        Whoever aids or abets any person in commission of any act specified in sub‑section (1) or (2) shall on conviction, be punished with rigorous imprisonment which shall not be less than three months but which may extend to one year and with fine of rupees twenty thousand.

 

(5)        Whoever commits any of the acts specified in sub‑sections (1) to (3) and the offence is a continuing one under any of the provisions of these sub‑sections, shall, on conviction, be punished with daily fine which shall not be less than rupees five hundred during the period of the continuance of the offence, in addition to the punishments provided under this section.

 

(6)        Where a dealer is guilty of an offence specified in sub‑sections (1) and (2), the person to be the manager of the business of such dealer under section 65 shall also be deemed to be guilty of such offence, unless he proves that the offence was committed without his knowledge or that he exercised all due diligence to prevent the commission thereof.

 

86.       Offences by companies, etc.

 

(1)        Where an offence under this Act or the rules thereunder has been committed by a company, every person who at the time the offence was committed, was in‑charge of, and was responsible to the company for the conduct of the business of the company, as well as the company shall be deemed to be guilty of the offence and shall be liable to be proceeded against and punished accordingly:

 

PROVIDED that, nothing contained in this sub‑section shall render any such person liable to any punishment provided in this Act if he proves that the offence was committed without his knowledge or that he exercised all due diligence to prevent the commission of such offence.

 

(2)        Notwithstanding anything contained in sub‑section (1), where an offence under this Act has been committed by a company and it is proved that the offence has been committed with the consent or connivance of, or is attributable to any neglect on the part of any director, manager, secretary or other officer of the company, such director, manager, secretary or other officer shall also be deemed to be guilty of that offence and shall be liable to be proceeded against and punished accordingly.

 

Explanation: For the purpose of this section­

 

(a)        "company" means a body corporate, and includes a firm or other association of persons‑, and

(b)        "director" in relation to a firm means a partner in the firm.

 

(3)        Where an offence under this Act has been committed by a Hindu Undivided Family, the karta thereof shall be deemed to be guilty of the offence and shall be liable to be proceeded against and punished accordingly:

 

PROVIDED that nothing contained in this sub‑section shall render the karta liable to any punishment if he proves that the offence was committed without his knowledge ,or that he had exercised all due diligence to prevent the commission of such offence:

 

PROVIDED FURTHER that, where an offence under this Act has been committed by a Hindu Undivided Family and it is proved that the offence has been committed with the consent or connivance of or is attributable to any neglect on the part of any adult member of the Hindu Undivided Family, such member shall also be deemed to be guilty of that offence and shall be liable to be proceeded against and punished accordingly.

 

87.       Cognizance of offences

 

(1)        No court shall take cognizance of any offence under this Act or the rules except with the previous sanction of the Commissioner, and no court inferior to. that of a Metropolitan Magistrate shall try any such offence.

 

(2)        Notwithstanding anything contained in the Code of Criminal Procedure, 1973, all offences punishable under this Act or the rules shall be cognizable and bailable.

 

88.       Investigation of offences

 

(1)        Subject to such conditions as may be prescribed, the Commissioner may authorize either generally or in respect of a particular case or class of cases any officer or person subordinate to him to investigate all or any of the offences punishable under this Act.

 

(2)        Every officer or person so authorized shall, in the conduct of such investigation, exercise the powers conferred by the Code of Criminal Procedure, 1973 upon an officer‑in‑charge of a police station for the investigation of a cognizable offence.

 

89.       Compounding of offences

 

(1)        The Commissioner may, either before or after the institution of proceedings for any offence punishable under section 85 or under any rules accept from any person charged with such offence, by way of composition of offence a sum of rupees five thousand or where the offence charged is under section 85 not exceeding double the amount of tax, but not less than the amount of tax, which would have been payable on the turnover of sale or purchase to which the said offence relates, whichever is greater.

 

(2)        On payment of such sum as may be determined by the Commissioner under sub‑section (1), no further proceedings shall be taken against the accused person in respect of the same offence and any proceedings, if already taken, shall stand abated.

 

MISCELLANEOUS

 

90.       Indemnity

 

(1),       No suit, prosecution or other legal proceedings shall lie against the Commissioner or any officer of the Government for anything which is in good faith done or intended to be done under this Act or the Rules.

 

(2)        No action shall lie for damages or for any other claim by any person against the Commissioner or any officer of the Government for anything done in good faith in discharge of their duties under this Act.

 

91.       Public servants

 

The Commissioner and all officers and persons appointed under section 16 and all members of Tribunal appointed under section 19 shall be deemed to be public servants within the meaning of section 21 of Indian Penal Code, 1860.

 

92.       Disclosure of information by a public servant

 

(1)        All particulars contained in any statement made or return furnished or accounts or documents produced in accordance with the provisions of this Act, or any record of evidence given in the course of any proceedings under this Act (other than proceedings before a criminal court), shall, save as provided in sub‑section (3) be treated as confidential and no court shall save as aforesaid, be entitled to require any servant of the Government to produce before it any statement, declaration, return, accounts, document or record or any part thereof, or to give evidence before it in respect thereof.

 

(2)        Nothing contained in this section shall apply to the disclosure,

 

(a)        of any such particulars in respect of any such statement, return, account, document, evidence, affidavit or deposition for the purpose of any prosecution under the Indian Penal Code, 1860 or the Prevention of Corruption Act, 1988, or this Act, or

(b)        of any such particulars to the State Government or to any person acting in the execution of this Act, for the purpose of carrying out the object of this Act, or

(c)        of any such particulars when such disclosure is occasioned by the lawful employment under this Act, of any process for the service of any notice or the recovery of any demand, or

(d)        of any such particulars to a civil court in any suit, to which the Government is a party, which relates to any matter arising out of any proceedings under this Act, or

(e)        of any such particulars to any officer appointed to audit, receipt or refund of the tax imposed by this Act, or

(f)         of any such particulars where such particulars are relevant to any inquiry into the conduct of an official of the Sales Tax Department to any person or persons appointed to hold such inquiry, or

(g)        of such facts to an officer of the Central Government or a State Government as may be necessary for the purpose of enabling the Government to levy or realize any tax or duty imposed by it, or

(h)        of any such particulars, when such disclosure is occasioned by the lawful exercise by a public servant of his powers under the Bombay Stamps Act, 1958 or the Indian Stamp Act, 1989 to impound an insufficient stamped document, or

(i)         of any such particulars where such particulars are relevant to any inquiry into a charge of misconduct in connection with sales tax proceedings against a legal practitioner, sales tax practitioner, Chartered Accountant or Cost Accountant to the authority empowered to take disciplinary action against members practising the profession of a legal practitioner, sales tax practitioner, Chartered Accountant or Cost Accountant, as the case may be, or

(j)         of any such particulars to the Director, Bureau of Economic and Statistics or to any person or persons authorized under sub‑section (2) of section 71 as may be necessary to enable the Director or such person or persons to work out the incidence of tax on any commodity, or

(k)        of any such particulars to an officer of the Central Government for the purpose of investigation or prosecution under any law for the time being in force, as the State Government may direct in any specific case.

 

93.       Assessment proceedings, etc., not to be invalid on certain grounds

 

(1)        No assessment (including reassessment, revision or rectification), notice, summons or other proceedings made or issued or taken or purported to have been made or issued or taken in pursuance of any of the provisions of this Act or under the earlier law shall be invalid or shall be deemed to be invalid merely by reason of any mistake, defect or omission in such assessment, notice, summons or other proceedings, if such assessment, notice, summons or other proceedings are in substance and effect in conformity with or according to the intent and purposes of this Act or any earlier law.

 

(2)        The service of any notice, order or communication shall not be called in question if the said notice, order or communication, as the case may be, has already been acted upon by the dealer or person to whom it is issued or which service has not been called in question at or in the earliest proceedings commenced, continued or finalized pursuant to such notice, order or communication.

 

(3)        No order of assessment, reassessment, revision or rectification passed under the provisions of this Act shall be invalid merely on the ground that the action could also have been taken by any other authority under any other provision of this Act.

 

94.       Bar of jurisdiction of civil courts

 

Save as provided by section 78,­

 

(i)         no civil court shall have jurisdiction to deal with or decide any question which the Tribunal, the Commissioner or any officer appointed to assist him is empowered to deal with or decide by or under this Act and no injunction shall be granted by any civil court in respect of any action taken or to be taken in pursuance of any power by or under this Act;

(ii)        no assessment made and no order passed under this Act or the Rules made thereunder by the Tribunal, the Commissioner or any officer appointed to        assist him shall be called in question in any civil court.

 

95.       Disclosure of information required under section 71

 

(1)        No information of any individual return or part thereof with respect to any matter given for the purposes of section 71 shall without the previous consent in writing of the owner for the time being or his authorized agent, be published in such manner as to enable any particulars to be identified as referring to a particular dealer and no such information shall be used for the purpose of any proceedings under the provisions of this Act.

 

(2)        Except for the purpose of prosecution under this Act, or under the Indian Penal Code, 1860 no person who is not engaged in the collection of statistics under section 71 or in the administration of this Act shall be permitted to see or have access to any information or any individual return referred to in that section.

 

(3)        If any person required to furnish any information or return under section 71,

 

(a)        without reasonable cause fails to furnish such information or return as may by that section be required, or

(b)        willfully furnishes or causes to furnish any information or return which he knows to be false,

 

he shall, on conviction, be punished with fine which may extend to one hundred rupees and in case of a continuing offence to a further fine which may extend to one hundred rupees for each day after the first day during which the offence continues.

 

(4)        If any person engaged in connection with the collection of statistics under section 71 willfully discloses any information or the contents of any return given or, made under that section, otherwise than in execution of his duties under that section or for the purposes of the prosecution of any offence under this section or for the purposes of the prosecution of an offence under this Act or under the Indian Penal Code, 1860 he shall on conviction be punished with imprisonment for a term which may extend to six months or with fine which may extend to one thousand rupees or with both.

 

96.       Levy of fees

 

On every application-­

 

(a)        for a certified or duplicate copy of a certificate of registration, or

(b)        for a certified copy of an order of assessment or any order passed or any document produced or filed in any proceeding under this Act, or

(c)        for the determination of any question under section 80, or

(d)        for a copy of order or document under this Act, there shall be paid such fee in court fee stamps as may be prescribed.

 

97.       Publication of information regarding dealers and other persons in public interest

 

(1)        Notwithstanding anything contained in section 92, if the Commissioner is of the opinion that it is necessary or expedient in the public interest to publish or disclose the names of any dealers or other persons and any other particulars relating to any proceedings under this Act in respect of such dealers and persons, he may publish or disclose or cause to be published or disclosed such names and particulars in such manner as he thinks fit.

 

(2)        No publication or disclosure under this section shall be made in relation to any tax levied or penalty imposed or interest levied or any conviction for any offence connected with any proceeding under this Act, until the time for presenting an appeal to the appropriate appellate authority has expired without an appeal having been presented or the appeal, if presented has been disposed of.

 

Explanation : In the case of a firm, company or other association of persons, the names of the partners of the firm, the directors, secretaries, treasurers or managers of the company or the members of the association, as the case may be, may also be published or disclosed, if, in the opinion of the State Government, the circumstances of the case justify it.

 

98.       Power to make rules

 

(1)        The State Government may, by notification in the Official Gazette, make Rules for carrying out the purposes of this Act.

 

(2)        In particular and without prejudice to the generality of the foregoing power, such Rules may provide for all or any of the matters expressly required or allowed by this Act to be prescribed by rules.

 

(3)        In making any Rules under this section the State Government may direct that a breach thereof shall be punishable with fine not exceeding two thousand rupees, and when the offence is continuing one, with a daily fine not exceeding one hundred rupees during the continuance of the offence.

 

(4)        The power to make rules conferred by this section shall be subject to the condition of the Rules being made after previous publication:

 

PROVIDED that if the State Government is satisfied that circumstances exist which render it necessary to take immediate action, it may dispense with the previous publication of any Rule to be made under this section.

 

(5)        All rules made under this section shall be laid for not less than thirty days before the State Legislature as soon as may be after they are made and shall be subject to rescission by the State Legislature or to such modifications as the State Legislature may make during the session in which they are so laid or session immediately, following. Any rescission or modification so made by the State Legislature shall be published in the Official Gazette, and shall thereupon take effect.

 

99.       Power to remove difficulties

 

If any difficulty arises in giving effect to the provisions of this Act, the State Government may, by general or special order published in the Official Gazette, make such provisions not inconsistent with the provisions of this Act as appear to it to be necessary or expedient for the removal of the difficulty:

 

PROVIDED that no such order shall be made after the expiration of two years from the commencement of this Act.

 

100. Repeal and savings

 

(1)        The Gujarat Sales Tax Act, 1969 (Gujarat 1 of 1970) and the Gujarat Purchase Tax on Sugarcane Act, 1989 (Gujarat 11 of 1989) are hereby repealed:

 

PROVIDED that such repeal shall not affect the previous operation of the said Acts or any right, title, obligation or liability already acquired, accrued or incurred thereunder and subject thereto, anything done or any action taken including any appointment, notification, notice, order, Rule, form or certificate in exercise of any powers conferred by or under the said Act shall be deemed to have been done or taken in exercise of the powers, conferred by or under this Act, as if this Act were in force on the date on which such thing was done or action was taken, and all arrears of tax and other amount due at the commencement of this Act may be recovered as if they had accrued under this Act.

 

(2)        Notwithstanding the repeal of the Gujarat Sales Tax Act, 1969 (Gujarat I of 1970), or as the case may be, the Gujarat Purchase Tax on Sugarcane Act, 1989 (Gujarat 11 of 1989), (hereinafter in this section referred to as the "said Act")

 

(a)        all rules, regulations, orders, notifications, forms and notices issued under the said Act and in force immediately before the appointed day shall continue to have effect for the purposes of the levy, assessment, reassessment, collection, refund or set‑off of any tax, or the granting of a drawback in respect thereof or the imposition of any penalty, which levy, assessment, reassessment, collection, refund, set‑off, drawback or penalty relates to any period before the appointed day or for any other purpose whatsoever connected with or incidental to any of the purposes aforesaid;

(b)        any registration certificate issued under the said Act and in force immediately before the appointed day shall be deemed to be the registration certificate issued under this Act, and accordingly such registration certificate shall be valid and effectual as a registration certificate under this Act until such certificate is issued, substituted, suspended or cancelled under the provisions of this Act;

(c)        any appointment, notification, order, rule, regulation, form or notice made or issued under the said Act shall, so far as it is not inconsistent with the provisions of this Act, continue in force, and be deemed to have been made or issued under the provisions of this Act, unless and until it is superseded by any appointment, notification, order, rule, regulation, form or notice made or issued under the provisions of this Act; and

(d)        any person entitled to appear before any authority under the said Act shall be deemed to be entitled to appear before any authority under this Act, and accordingly if such person be a sales tax practitioner he shall be entitled to have his name entered in the list maintained under section 81.

 

(3)        Without prejudice to the provisions contained in sub‑section (2) and subject thereto, section 7 of the Bombay General Clauses Act, 1904 shall apply in relation to the repeal of said Act as if the said Act had been enacted within the meaning of the said section 7.