Subject NOT available

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

5

(3) A transfer of any proceeding shall not render necessary the re-issue oi any notice already issued before such transfer and the person to whom the proceeding is transferred may, in his discretion, continue it from the stage at which it was left by the person from whom it was transferred.

Appellate Tribunal.

10

12. (/) The Central Government shall, as soon as may be after the commencement of this Act, constitute an Appellate Tribunal consisting of one or more members as it thinks fit to exercise the powers and discharge the functions conferred on the Appellate Tribunal hv or under this Act:

15

20

Provided that where the Appellate Tribunal consists of one mem- ber, that member shall be a person who has held a civil judicial post for at least ten years or who has been a member of the Central Legal Service (not below Grade III) for at least three years or who has been in practice as an advocate for at least ten years, and where the Appellate Tribunal consists of more than one member, one such member shall be a person qualified as aforesaid.

(2) Where the number of members of the Appellate Tribunal is more than one, the Central Government shall appoint one of those members to be the President of the Appellate Tribunal.

25

(3) Subject to the provisions of sub-section (1). the qualifications and other conditions of service of the member or members constitut- ing the Appellate Tribunal and the period for which such member or members shall hold office, shall be such as may be determined by the Central Government,

30

(4) Any vacancy in the membership of the Appellate Tribunal shall be filled up by the Central Government as soon as practicable.

(5) Where the number of members of the Appellate Tribunal is more than one and they are divided, the decision shall be the deci- sion of the majority, if there be a majority; if the members are equally divided the decision of the President shall be final.

35 (6) Subject to the previous sanction of the Central Government, the Appellate Tribunal shall, for the purpose of regulating its proce- dure and disposal of its business, make regulations consistent with the provisions of this Act and the rules made thereunder.

45 of 1860.

(8) The Appellate • Tribunal shall, for the purpose of discharging its functions, have all the powers which are vested in the Commis- sioner under section 35, and any proceeding before the Appellate Tribunal shall be deemed to be a judicial proceeding within the mean- ing of sections 193 and 228, and for the purpose of section 196 of the 5 Indian Penal Code and the Appellate Tribunal shall be deemed to be a civil court for all the purposes of section 195 and Chapter XXXV of the Code of Criminal Procedure, 1898.

5 of 1898.

CHAPTER IV

RJfelSTRATlON, AMENDMENT AND CANCELLATION

10

Registra-

tion. 13. (1) No dealer shall, while being liable to pay tax under sec- tion 3, carry on business as a dealer unless he has been registered and possesses a certificate of registration.

15 (2) Every dealer required by sub-section (1) to be registered shall make an application for registration within such time, in such manner and to such authority as may be prescribed.

20 (3) If the said authority is satisfied that the application is in order, it shall, in accordance with such rules as may be prescribed, register the applicant and grant him a certificate of registration in the prescribed form which shall specify the goods or class of goods for the purposes of sub-clause (iv) of clause (a) of sub-section (2) of section 4.

(4) For the removal of doubts it is hereby declared that the goods

25 or class of goods to be specified in a certificate of registration granted under sub-section (3) of this section or sub-section (2) of section 15 shall not include goods referred to in sub-clause (i) or sub-clause (ii) of clause (a) of sub-section (2) of section 4.

14. (1) Any dealer, other than a dealer who deals exclusively in Voluntary registra- tion.

3° one or more classes of goods specified in the Third Schedule, whose turnover during a year exceeds ten thousand rupees may, notwith- standing that he may not be liable to pay tax under section 3, apply for registration under this section.

(3) Every dealer who has been registered under this section shall, lor so long as his registration remains in force, be liable to pay tax under this Act.

(4) The registration of a dealer under this section shall be in force for a period of not less than three complete years and shall remain in force thereafter unless cancelled under the provisions of this Act.

5

Provi- sional registra- tion.

10

15. (1) Any person who intends to establish a business in Delhi for the purpose of manufacturing goods of a value exceeding ten thousand rupees per year, may, notwithstanding that he is not re- quired to register himself under section 13, apply for provisional re- gistration in such manner and to such authority as may be pres- cribed.

15

(2) If the said authority, after making such inquiry as it may consider necessary, is satisfied as to the bona fide intention of the person making the application, it may grant a provisional certificate of registration on such person furnishing such security as it may consider necessary and shall specify in such certificate the goods or class of goods for the purposes of sub-clause (iv) of clause (a) of sub-section (2) of section 4.

20

(3) Every person who has been granted a provisional certificate of registration under this section shall, for so long as such certificate is in force, be liable to pay tax under this Act.

(4) A provisional certificate of registration granted under this section shall be in force for such period as may be specified therein.

25

(5) The authority prescribed under sub-section (1) may, on appli- cation made in this behalf in the prescribed manner and subject to such restrictions and conditions as may be imposed by it, extend, from time to time, the period specified in the provisional certificate of registration.

Special registra- tion.

30

16. (1) No dealer shall, while being liable to pay tax under sub- section (5) of section 3, carry on business as a dealer unless he has obtained a special certificate of registration.

(2) Every dealer required to be registered under sub-section (1) shall make an application for registration within such time, in such manner and to such authority as may be prescribed.

35

(3) If the said authority is satisfied that the application is in order, it shall, in accordance with such rules as may be prescribed, grant a special certificate of registration to the applicant in the prescribed form:

Security from certain class of dealers.

5 17. The Commissioner may, if it appears to him to be necessary so to do for the proper realisation of the tax payable under this Act, impose for reasons to be recorded in writing as a condition of the grant of a certificate of registration under section 13, section 14 or section 16 to a dealer or of the continuance, in effect, of such a certi- ficate granted to any dealer, a requirement that the dealer shall furnish sufficient security in the manner prescribed for payment of the tax for which he may be or become liable under this Act.

10 18. (I) The Commissioner may, after considering any informa- tion furnished under this Act or otherwise received, amend, from time to time, any certificate of registration.

Amend- ment of certificate of regis- tration.

(2) An amendment of the certificate of registration made under

sub-section (1) shall take effect,—

i5 (a) in the case of a change in the name, ownership or place of business or opening of a new place of business, from the date of the contingency which necessitates the amendment whether or not information in that behalf is furnished within the time prescribed under section 33;

20 (b) in the case of any addition or modification in the descrip- tion of any goods or class of goods in the certificate of registra- tion, from the date of the contingency if information in that behalf is furnished within the time prescribed under section 33, and from the date of receipt of request for such addition or modi- fication by the Commissioner in any other case;

(e) in the case of deletion of any goods or class of goods,

25 from the date of the order of deletion:

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

3o Provided further that where in consequence of a change in the ownership of a business the liability to pay tax of a dealer ceases, the amendment of the certificate of registration shall take effect from the date on which information in respect of such change is furnished under section 33.

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

19. (1) Where—

(b) in the case of transfer of business by a dealer, the trans- feree already holds a certificate of registration under this Act; or

(c) a dealer has ceased to be liable to pay tax under sub- section (3) of section 3,

5 the Commissioner shall cancel the certificate of registration of such dealer or the transferor, as the case may be, from such date as may be specified by htm:

10

15

Provided that in a case referred to in clause (a) or clause (b), the certificate of registration shall be aeemed to be inoperative with effect from the date of discontinuance or transfer of the business, as the case may be, and in a case referred to in clause (c) from the date on which the dealer's liability to pay tax has ceased, notwith- standing the fact that the order of cancellation is passed or that the particulars of the dealer regarding cancellation are published, as re- quired by section 57, in the Official Gazette, after the aforesaid date:

20

Provided further that where a dealer has failed to furnish infor- mation regarding discontinuance of his business as required by sec- tion 33, the Commissioner shall, before cancelling the certificate from any specified date, publish in tlie Official Gazette a notice of his intention so to do for the information of the dealer and shall hear his objections, if any, before passing the order.

25

(2) A dealer registered under section 14 may, subject to the provi- sions of sub-section (4) of that section, apply In the prescribed man- ner not later than six months before the end of a year to the Com- missioner for cancellation of his certificate of registration and the Commissioner shall, unless the dealer is liable to pay tax under sec- tion 3, cancel the certificate of registration accordingly and such can- cellation shall take effect from the end of the year.

³⁰ (3) Notwithstanding anything contained in sub-sections (1) and (2), the Commissioner may at any time for reasons to be recorded in writing and after giving the dealer an opportunity of being heard, cancel the certificate of registration held by such dealer from such date as th" Commissioner may specify in this behalf—

35 (a) if the dealer has failed to pay any tax (including any penalty) due from him under any provision of this Act; or40 (b) if the dealer holds or accepts or furnishes or causes to be furnished a declaration for the purposes of sub-clause (iv) of clause (a) of sub-section (2) of section 4 which he knows or hag reason to believe to be false; or

(c) if the dealer who has been required to furnish security under the provisions of section 17, has failed to furnish such security; or

5

(d) if the dealer has failed, without sufficient cause, to fur- nish returns required to be furnished by or under the provisions of thii Act for a period of one year; or

(e) if the dealer contravenes or has contravened any provi-

sions of this Act; or

10 (f) if the dealer has been convicted of an offence under this Act or under the Bengal Finance (Sales Tax) Act, 1941 as in force in Delhi; or

(p) if there is any other reason which in the opinion of the

Commissioner warrants such cancellation.

15 (4) (a) If an order of cancellation passed under sub-section (3) is set aside as a result of an appeal or other proceeding under this Act, the certificate of registration of the dealer shall be restored and he shall be liable to pay tax as if his certificate had not been cancelled.

20 (b) If any dealer whose certificate of registration has been ree- tored under clause (a) satisfies the Commissioner that tax has been paid by such dealer on sale of goods made to him during the period his certificate of registration was inoperative which, but for the cancellation of such certificate, he would not have paid, then the amount of such tax shall be adjusted or refunded in such manner as may be prescribed.

25

30 (5) Every dealer who applies for cancellation of his 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 of the date of commu- nication to him of the order of cancellation.

CHAPTER V

RETURNS, ASSESSMENT, RECOVERY AND REFUND or TAX

20. (I) Tax payable under this Act shall be paid in the manner hereinafter provided at such intervals as may be prescribed.

5

Periodical payment of tax and filing of returns.

(2) Every registered dealer and every other dealer who may be required so to do by the Commissioner by notice served in the prescribed manner shall furnish such returns of turnover by such dates and to such authority as may be prescribed.

10

15

(3) Every registered dealer required to furnish a return under sub-section (2) shall pay into a Government Treasury or the Re- serve Bank of India or in such other manner as may be prescribed, the full amount of tax due from him under this Act according to such return, and shall, where such payment is made into a Govern- ment Treasury or the Reserve Bank of India, furnish along with the return a receipt from such Treasury or Bank showing the pay- ment of such amount.

20

(4) If any registered dealer discovers any mistake or error in any return furnished by him, he may at any time before the expiry of three months next following the last date prescribed for furnish- ing of the return, furnish a revised return, and if the revised return shows a higher amount of tax to be due than was shown in the original return, it shall be accompanied by a receipt showing pay- ment in the manner provided in sub-section (3) of the excess amount.

(5) Every return under this section shall be signed and verified—

25

30

(a) in the case of an individual, by the individual himself; where the individual is absent from India, by the individual concerned or by some person duly authorised by him in this behalf; and where the individual is mentally incapacitated from attending to his affairs, by his guardian or by any other person competent to act on his behalf;

(b) in the case of a Hindu undivided family, by a karta; and where karta is absent from India or is mentally incapacitated from attending to his affairs, by any other adult member of such family;

35

(c) in the case of a company or local authority, by the principal officer thereof;

(d) in the case of a firm, by any partner thereof, not being a minor;

(e) in the case of any other association, by any member of the association or the principal officer thereof; and

(f) in the case of any other person, by that person or by some person competent to act on his behalf.

5

43 of 1931, (6) For the purposes of sub-section (5) of this section and section 51, the expression "principal officer" shall have the meaning assigned to it under clause (35) of section 2 of the Income-tax Act, 1961.

10 Collection of tax only by registered dealers.

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

15 (2) Notwithstanding anything contained in sub-section (1), a dealer who has been permitted by the Commissioner to make a lump sum payment under section 26 shall not collect any sum by way of tax on the sale otE goods if made during the period to which such lump sum payment relates.

20 (3) Any amount collected by way of tax under this Act in con- travention of the provisions of sub-section (1) or sub-section (2) shall be deposited in a Government Treasury or the Reserve Bank of India and notwithstanding anything contained in this Act or any other law for the time being in force, the refund of such amount or any part thereof shall be allowed by the Commissioner In the pres- cribed manner to the person from whom such amount or part thereof was actually collected.

25 Assess- ment of tax.

22. (V) The amount oJ: tax due i'rom a registered dealer shall be assessed separately for each year during which he is liable to pay the tax:

30 Provided that when such dealer falls to furnish a return relating to any period of a year by the prescribed date, the Commissioner may, if he thinks fit, assess the tax due from such dealer separately for that period or any other period of such year:

Provided further that the Commissioner may, subject to such conditions as may be prescribed and for reasons to be recorded in writing, assess the tax due from any dealer for a part of a year. 35

(2) If the Commissioner is satisfied that the returns furnished m respect of any period are correct and complete, he shall assess the amount of tax due from the dealer on the basis of such returns.

(3) (a) If the Commissioner is not satisfied that the returns furnished in respect of any period are correct and complete and he 40

thinks it necessary to require the presence of the dealer or the pro- duction of further evidence, he shall serve on such dealer in the prescribed manner a notice requiring him on a date and at a place specified therein either to attend and produce or cause to be produced all evidence on which such dealer relies in support of his returns, or to oroduce such evidence as is specified in the notice.

(b) On the date specified in the notice, or as soon as may be thereafter, the Commissioner shall after considering all the evidence which may be produced, assess the amount of tax due from the dealer.

10

(4) If a dealer fails to comply with the terms of any notice issued under sub-section (3), the Commissioner shall assees to the best of his iudgment the amount of tax due from him.

ti

(5) If a dealer fails to furnish returns in respect of any period ; by the prescribed date, the Commissioner shall, after giving the dealer a reasonable opportunity of being heard, assess to the best of his iudgment the amount of tax. if any, due from him.

20

'-5

(6) If, upon information which has come into his possession, the Commissioner is satisfied that any dealer who has been liable to pay tax under this Act in respect of any period has failed to apply for registration within time as required by sub-section (2) at section 13 or sub-section (2) of section 16, as the case may be, the Commissioner shall proceed in such manner as may bo prescribed 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 and in making such assessment shall give the dealer a reasonable opportunity of being heard, and the Commissioner may, if he is satisfied that th" default was made without reasonable cause, direct that the dealer shall pay by way of penalty, in addition to the amount of the tax so assessed, a sum not exceeding one and a half times that amount.

30

(7) No assessment under the provisions oi sub-sections (1) to (5) shall be made after the expiry of four years and no assessment under the provisions of sub-section (6) 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:

3540 Provided that where such assessment is made in consequence of, or to give effect to, any order of an appellate or revisional authority or of a court, the period of four years or eight years, as the case may be, shall be reckoned from the date of such order and further that the provisions of sub-section (1) of section 23 regarding time limit for service of notice shall not apply for assessment made under this proviso.

(8) Any assessment made under this section shall be without

prejudice to any prosecution for an offence under this Act.

5 (9) In computing the period of limitation for the purposes of this section and section 23, any period during which any proceeding under this section is stayed by an order or injunction of any court shall be excluded.

Turnover •scaping assess- ment.

10 23. (I) Where the Commissioner has reason to believe that the whole or any part of the turnover of a dealer in respect of any period has escaped assessment to tax ox has been under-assessed or has been assessed at a rate lower than the rate at which it is assessable, or any deduction has been wrongly made therefrom, the Commissioner may—

15 (a) within eight years from tho end of the year in respect of which or part of which the assessment is made, in a case where the dealer has concealed, omitted or failed to disclose fully the particulars of such turnover; and

(b) within four years from the end of the year in respect of which or part of which the assessment is made, in any other case,

20 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 the amount of tax due from the dealer in respect of such turnover, and the provisions of this Act shall, so far as may be, apply accordingly.

25 Explanation.—For the purpose of this section, production before the Commissioner of account books or other evidence from which material evidence could with due diligence have been discovered by the Commissioner will not necessarily amount to disclosure within the meaning of thi3 section.

30 (2) No order of assessment, re-assessment or re-computation

shall be made under sub-section (i), after—

(a) the expiry of four years or eight years as prescribed in

sub-section (7) of section 22; or

(b) the expiry of one year from, the date of service of notice

under sub-section (1),

35 whichever is later.

24. (I) The amount of tax—

(a) due where returns have been furnished without receipt

ghowing full payment thereof; or

Payment and recovery of tax.

(b) assessed or re-assessed for any period under section 22 or section 23, less ihe amount, if any, already paid by the dealer in reapc-L't of the said period,

5

10

shall together with any penalty that may be directed to be paid under any of the provisions of this section, sub-section (6) of section 22, section 47, section 48 or section 49 be paid by the dealer or the person liable therefor into a Government Treasury or the Reserve Bank of India 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;

15

Provided that where the Commissioner has reason to believe that it will be detrimental to revenue if the lull period of thirty days aforesaid is allowed, he may direct that the sum specified in the notice of demand shall be paid within such period being a period less than the period of thirty days aforesaid, as may be specified by him in that notice.

30

(2) On an application made before the expiry of the due date under sub-section (7), the Commissioner may in respect of any par- ticular dealer or person and for reasons to 'be recorded in writing, extend the time for payment or allow payment by instalments or grant stay, subject to such conditions as he may think fit to impose in the circumstances of the case.

35

(3) 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 person liable therefor shall be deemed to be in default in respect of that amount.

30

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

35 (5) When a dealer or a person is in default or is deemed to be in default in making payment of tax, he shall, in addition to the amount of arrears payable under the foregoing sub-sections, be liable to pay by way of penalty an amount which in the case of a conti- nuing default may be increased, from time to time, so, however, that

th" total amount of penalty does not exceed the amount of tax in arrears:

Provided that before levying any such penalty the dealer or the person aforesaid shall be given a reasonable opportunity of being heard.

5

(6) Where as a result of any final order the amount of tax, with respect to the default in the payment of which the penalty was levied, has been wholly reduced, the penalty levied shall be cancelled and the amount of penalty paid shall be refunded.

10 (7) Any amount of tax or penalty in respect of which a dealer or person Is in default, or any composition money due under section 26 or section 46 which remains unpaid, shall be recoverable as an arrear of land revenue:

Provided that where security has been furnished by a dealer

15 under sub-section (2) of section 15 or section 17, the Commissioner may, for good and sufficient reasons, realise any amount of tax or penalty remaining unpaid as aforesaid or part thereof by ordering forfeiture of the whole or any part of tb/j security.

20 wodaof rwcorwry.

25. (i) Notwithstanding anything contained in any law or con- tract 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 hia last known address require,—

25 (a) any person from whom any amount of money is due, or may become due, to a dealer on whom notice has been served undatr sub-section (I) of section 24; or

(b) any person who holds or may subsequently hold money

for or on account of such dealer,

30 to pay to the Commissioner, either forthwith upon the money becoming due or being held or within the time specified in the first mentioned notice (but not before the money becomes due or is held as aforesaid) so much of the money as is sufficient to pay the amount due by the dealer in respect of the arrears of tax and penalty under this Act, or the whole of the money when it is equal to or less than that amount.

Explanation.—For the purpose of this section, the amount of money due to a dealer from, or money held for or on account of a dealer by, any person, shall be calculated by the Commissioner after deducting therefrom 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.

5

(3) Any person making any payment in compliance with a notice under this section shall be deemed to have made the pay- ment under the authority of the dealer, and the receipt of the Com- missioner shall constitute a good and sufficient discharge of the liability of such person to the extent of the amount referred to, in the receipt.

10

(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 and penalty, whichever is less.

15

(5) Where a person to whom a notice under this section is sent proves to the satisfaction of the Commissioner that the sum demand- ed or any part thereof is not due to the dealer, or that he does not hold any money for or on account of the dealer, then, nothing contained in this section shall be deemed to require such person to pay any such sum or part thereof, as the case may be, to the Commissioner.

"o

(6) Any amount of money 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.

Lump sum payment of tax.

25 26. The Commissioner may, in such circumstances and subject to such conditions as may be prescribed, permit any dealer to pay In lieu of the amount of tax payable by him under the provisions of this Act, a lump sum determined in the prescribed manner, by way of composition.

Refund.

30

35

27. (1) If any dealer satisfies the Commissioner that the amount of tax paid toy him or on his behalf for any year exceeds the amount payable by him under this Act for that year, he shall, on making a claim in the prescribed form and verified in the prescribed manner, be entitled to refund of the excess either by cash payment or at his option by deduction of such excess from the amount of tax and penalty (if any) due in respect of any other period:

Explanation.-—When no assessment is made, the due tax paid under section 20 by the dealer shall be deemed to be tax payable under this Act.

5 (2) Where through death, incapacity, insolvency, liquidation or other cause a person is unable to claim or receive any refund due to him, his legal representative or the trustee or guardian or receiver, as the case may be, shall be entitled to claim or receive such refund for the benefit of such person or his estate.

10 (3) No claim for refund under sub-section (1) shall be allowed unless it is made within twelve months from the last day of the year for which assessment has been made or within twelve months from the date of service of the notice of the assessment of tax or imposi- tion of penalty (if any) under section 24, whichever is later.

15 (4) Where as a result of any order passed in appeal or other proceeding under this Act refund of any amount becomes due to the dealer, the Commissioner shall, except as otherwise provided in this Act, refund the amount to the dealer without his having to make any claim in that behalf.

20 (5) 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 the grant of the refund is likely to adversely affect the revenue, the Commissioner may withhold the refund till such time as the Commissioner may determine.

25 (6) In any claim for refund, it shall not be open to the dealer to question the correctness of any assessment or other matter decided which has become final and conclusive or ask for a review of the same and the dealer shall not be entitled to any relief on such claim except refund of tax wrongly paid or paid in excess.

30 (7) Any tax levied and collected under this Act in respect of the sale in Delhi of any declared goods which are subsequently sold in the course of inter-State trade or commerce, shall be refunded to such person, in such manner and subject to such conditions as may be prescribed.

35

74 of 1958.

Explanation.—For the purpose of sub-section (7), "declared goods" means goods declared by section 14 of the Central Sales Tax Act, 1956 to be of special importance in inter-State trade or com- merce.

28. (1) Where the Commissioner is satisfied that avoidable delay has occurred in the grant of a certificate of registration to a dealer40

5

and that such delay was not wholly due to any fault, omission or negligence on the part of the dealer, the amount of tax, if any, paid on sales of goods made to such dealer which would not have been payable but for the delay in the grant of a certificate of registration as aforesaid, shall be adjusted against any amount payable by the dealer under this Act:

Provided that—

10

(a) in case the amount of tax so paid by the dealer exceeds his liability to pay any amount under this Act, the adjustment shall be made to the extent of such liability and the balance shall be refunded to the dealer, and

(b) in case there is no liability to pay any amount under this Act, the entire amount of tax paid shall be refunded to the dealer;

15 Provided further that the dealer shall not be entitled to any such adjustment or refund in respect of the goods which are not specified in the certificate of registration granted to him.

20

(2) No application for adjustment or refund of tax under this section shall be entertained unless it is made within three months from the date on which a certificate of registration is granted to the dealer.

CHAPTER VI

LIABILITY IN SPECIAL CASES

25

29. (1) Where the ownership of the business of a dealer liable to pay tax is transferred absolutely by sale, gift, or otherwise, or transferred by way of lease, and the transferee or lessee carries on such business either in its old name or in some other name,—

Liability in case of transfer of busi- ness.

30

(a) the transferor and the transferee or the lessee, as the case may be, shall jointly and severally be liable to pay the tax and penalty, if any, payable in respect of such business and remaining unpaid at the time ol the transfer; and

(b) the transferee or the lessee shall be liable to pay tax35 on the sales of goods effected by him with effect from the date of such transfer, and shall, if the transferor is a registered dealer, apply within thirty days of the transfer, for amendment of the certificate of registration unless the transferee or the lessee already holds a certificate of registration.

(2) When a dealer liable to pay tax transfers by way of sale or otherwise the ownership of a part of his business, the transferor

shall be liable to pay the tax in respect of the stock In trade so transferred, as if it was a regular sale in the course of business.

30. (1) Every person—

5 (a) who is the liquidator of any company which is being wound up whether under the orders of a court or otherwise; or Liability In case of company in liqui- dation.

(b) who has been appointed the receiver of any assets of a company,

to (hereinafter referred to as the liquidator), shall, within thirty days after he has become such liquidator, give notice of his appointment as such to the Commissioner.

15 (2) The Commissioner shall after making such inquiries or calling for such information as he may deem fit, notify to the liquidator within three months from the date on which he receives notice of the appointment of the liquidator, the amount which, in the opinion of the Commissioner, would be sufficient to provide for any tax (including penalty) which is then or is likely thereafter to became, payable by the company-

20 (3) The liquidator shall not part with any of the assets of the company or the properties in his hands until he has been notified by the Commissioner under sub-section (2) and on being so notified, shall set aside an amount equal to the amount notified and, until he so sets aside such amount, shall not part with any of the assets of the company or the properties in his hands:

25

30 Provided that nothing contained in this sub-section shall debar the liquidator from parting with such assets or properties for the purpose of the payment of the tax and penalty (if any) payable by the company or for making any payment to secured creditors whose debts are entitled under law to priority of payment over debts due to Government on the date of liquidation or for meeting such costs and expenses of the winding up of the company as are in the opinion of the Commissioner reasonable.

35 (4) If the liquidator fails to give the notice in accordance with sub-section (1) or fails to set aside the amount as required by sub- section (3) or parts with any of the assets of the company or the properties in his hands in contravention of the provisions of that sub-section, he shall be personally liable for the payment of the tax and penalty (if any) which the company would be liable to pay:

Provided that if the amount of any tax (including penalty) payable by the company is notified under sub-section (2), the

personal liability of the liquidator under this sub-section shall be to the extent of such amount.

(5) Where there are more liquidators than one, the obligations and liabilities attached to the liquidator under this section ihall attach to all the liquidators jointly and severally-

5

10

'5

(6) When any private company is wound up and any tax (includ- ing penalty) assessed on the company lor any period, whether before or in the course of Or after ita 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 be jointly and severally liable for the payment of such tax (including penalty) unless he proves to the satisfaction of the Commissioner that non- recovery cannot be attributed to any gross neglect, misfeasance or breach of duty on his part in relation to the affairs of the company. (7) The provisions of this section shall have effect notwithstand- ing anything to the contrary contained in any other law for the time being in force.

30

1 of 1956.

(S) For the purposes of this section, the expressions "company", and "private company" shall have the meanings respectively aligned to them under clauses (i) and {Hi) of sub-section (1) of lection S of the Companies Act, 1956.

Liability inoth"r

CMM.

31. (1) Where a dealer ig a firm or association of persons or a Hindu undivided family, and such firm, association or family has discontinued business—

25

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

30

^5

(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 the tax assessed and penalty imposed and payable by such firm, association or family, whether such tax (including penalty) has been assessed prior to or after such discontinuance, and, subject as aforesaid, the provisions of this Act shall apply as if every such person or partner or member were himself a dealer.

(2) Where it is found that a change has occurred in the con- stitution of the firm or association, the firm or association as re-Cons- tituted as well as partners or members of the firm or association as it existed before the re-constitution, shall jointly and severally be liable to pay any tax (including penalty) due from such firm or asso- ciation for any period before its re-constitution.

5 (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-aectlon to discontinuance shall be construed as references to dissolution or, as the case may be, to partition.

10 (4) Where a dealer liable to pay tax under this Act dies then,— (a) If the business carried on by the dealer is continued after his death by hia legal representative or any other person, such legal representative or other person, shall be liable to pay the tax due from such dealer under this Act;

i5 (b) if the business carried on by the dealer is discontinued after his death, his legal representative shall be liable to pay out of the estate of the deceased, to the extent the estate is capable of meeting the charge, the tax and penalty (if any) due from ouch dealer under this Act, whether such tax and penalty (if any) has been assessed before his death but has remained unpaid, or is assessed after his death.

20

5 of 1908.

Explanation.—For the purpose of sub-section (4) of this section and section 33, "legal representative" has the meaning assigned to it In clause (11) of section 2 of the Code of Civil Procedure, 1908.

CHAPTER Vn

LIABILITY TO PRODUCE ACCOUNTS AND SUPPLY OF INFOHMATION

25

3o Accounts. 32. Every registered dealer or other dealer on whom a notice has been served to furnish returns under sub-section (2) of section 20 shall keep a true account of the value of goods bought and sold by him, and if the Commissioner considers that such account is not sufficiently clear and intelligible to enable him to make a proper check of the returns referred to in that sub-section, he may require such dealer by notice in writing to keep such accounts (including records of sales) as may be specified therein.

33. If any dealer to whom the provisions of sub-section (2) of section 20 apply—

35 Informa- tion to be furnished regarding change of business.

(a) sells or otherwise disposes of his business or any part of his business or any place of business, or effects or comes to know of any other change in the ownership of the business;

(b) discontinues his business or changes his place of busi- ness or warehouse, or opens a new place of business; or40 (c) changes the name or nature of his business or effects any change In the goods or class of goods in which he carries on his business and which is or {ire specified in his certificate of

he shall within the prescribed time inform the prescribed authority accordingly; and if any such dealer dies, his legal repre- sentative, shall in like manner, inform the said authority.

34. (1) The Commissioner may, subject to such conditions as may

be prescribed, require any dealer—

5

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

documents,

Produc- tion and inspection of acco- unts and documents and fearch of pennisefl.

10

(b) to furnish such information, relating to the stock of goods of, or purchases, sales or deliveries of goods by, the dealer or any other information relating to his business,

as may be deemed necessary for the purposes of this Act.

(2) (n) All account books, registers and documents relating to the stock of goods of, or purchases, sales and deliveries of goods by, any dealer; and

(b) all goods kept in any place of business or warehouse of any 15

dealer,

20

shall at all reasonable times be open to inspection by the Commis- sioner and the Commissioner may take or cause to be taken such copies or extracts of the said account books, registers or documents and such inventory of the goods found as appear to him necessary for the purposes of this Act.

^5

30

(3) Where, upon information in his possession or otherwise* the Commissioner or any person appointed under sub-section (2) of section 9 to assist him (hereafter in this section referred to as the Sales Tax Officer) has reasonable ground to believe that account books, registers or documents of any dealer may be destroyed, muti- lated, altered, falsified or secreted or any sales by that dealer have been or may be suppressed, with a view to evade or attempt to evade payment of tax due under this Act, the Commissioner or the Sales Tax Officer may make an application to the magistrate of the first class having jurisdiction for an order for the seizure of such account books, registers or documents or for checking the sale proceeds of the dealer.

35

(4) After considering the application and hearing the Commis- sioner or the Sales Tax Officer, if necessary, the Magistrate may, by order, authorise the Commissioner of the Sales Tax Officer—

(b) to search that place of business, warehouse or that

other place in the manner specified in the order;

(c) fertak open the lock of any door, box, locker, safe, al- mirah or other receptacle where the keys thereof are not avail- able; and

5 (d) to seize such account books, registers or documents, or any inventory of goods as appear to him necessary for the pur- poses of this Act.

10 (5) The Commissioner or the Sales Tax Officer, as the case may b", shall keap in bis custody the account books, registers or docu- ments seized under sub-section (4) for such period not later than tV- completion of all the proceedings under the Act in respect of y"nra for which those account books, registers or documents are relevant, as he considers necessary, and thereafter shall return the •tine to the dealer or any other person from whose custody or power they were seized and inform the Magistrate of such return:

15 Provided that the Commissioner or the Sales Tax Officer may, before returning such account books, registers or documents as aforesaid, place identification marks on them or any part thereof.

5 of 18S8.

20 (6) Save as otherwise provided in this section, every search or seizure made under this section shall be carried in accordance with the provisions of the Code of Criminal Procedure, 1898 relating to searches or seizures made under that Code.

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

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

(b) require any person—

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

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

5 of 1908.

36, (1) The Commissioner or any person appointed under sub- section (2) of section 9 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 fol- lowing matters, namely:—

5

(o) enforcing the attendance of any person and examining

him on oath or affirmation;

Power of Commis- sioner and other authori- ties to take evidence on oath, etc. (b) compelling the production of accounts and documents;

and

10

(c) issuing commissions for the examination of witnesses,

45 of 1860.

and any proceeding under this Act before the Commissioner or any person appointed under sub-section (2) of section 9 to assist him shall be deemed to be a judicial proceeding within the meaning of sections 103 and 228, and for the purposes of section 196 of the Indian Penal Code.

15

(2) Subject to any rules made in this behalf, any authority re- ferred to in sub-section (2) may impound and retain in its custody for such period as it thinks fit, any account books or other docu- ments produced before it in any proceedings under this Act:

20 Provided that a person appointed under sub-section (2) of sec-

tion 9 to assist the Commissioner shall not—

(a) impound any account books or other documents with-

out recording his reasons for so doing; or

(b) retain in W3 custody any such books or documents for

a period exceeding thirty days,

35

without obtaining the approval of the Commissioner therefor.

CHAPTER VIH

APPEALS, RWKRKNCE AND REVISION

Appeals.

30

36. (1) Any dealer aggrieved by any order, not being an order mentioned in section 37, passed under this Act or the rules made thereunder, may appeal to the prescribed authority:

Provided that where an order, not being an order mentioned in

section 37 or made under section 40, is passed by the Commissioner, the dealer may appeal therefrom to the Appellate Tribunal.

35

(2) Any person aggrieved by an order passed in appeal by the prescribed authority may appeal to the Appellate Tribunal against such order.

(4) Every appeal filed under this section shall be in the pres- cribed form and shall be verified in the prescribed manner and in

thfr case of an appeal to the Appellate Tribunal, shall be accom- panied by a fee of one hundred rupees.

5 (5) No appeal against an order of assessment with or without penalty or against an order imposing the penalty shall be entertained by an appellate authority unless such appeal is accompanied by a satisfactory proof of the payment of tax with or without penalty or, as the case may be, of the payment of the penalty in respect of which the appeal has been preferred:

to Provided that the appellate authority may, if it thinks fit, for reasons to be recorded in writing, entertain an appeal against such order—

(a) without payment of the tax with penalty, if any, or as the case may be, of the penalty, on the appellant furnishing in the prescribed manner security for such amount as it may direct, or

15 (b) on proof of payment of such smaller sum, with or with- out security for such amount of tax or penalty which remains unpaid, aa it may direct.

(

20

(o) confirm, reduce, enhance or annul the assessment (in- cluding any penalty imposed), or

(b) set aside the assessment (including any penalty im- posed) and direct the assessing authority to make a fresh assess- ment after such further inquiry as may be directed, or

25

(c) pass such order as it may think flt.

(7) Save aa provided in section 38, an order passed by the Ap- pellate Tribunal on appeal shall be final.

S7. No appeal and no application for revision shall lie against—

Non-ap- pealable orders.

3O (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 pertaining to the seizure or retention of ac- count books, registers and other documents; or(c) an order sanctioning prosecution under this Act; or 35 (d) an intwim order passed in the course of any proceed- ing*.

State- ment of Cage to the High Court.

5

10

38. (I) Within sixty days from the date of an order passed by the Appellate Tribunal under sub-section (6) of section 30, being an order which affects the liability of a dealer to pay tax or penalty under this Act, the dealer or the Commissioner may, by application in writing, and accompanied where the application is made by a dealer, by a fee of one hundred rupees, require the Appellate Tri- bunal to refor to the High Court any question of law arising out of fuch order, and. subject to the other provisions contained in this section, the Appellate Tribunal shall, as soon as may be after tho receipt of such application, draw up a statement of the case and refer it to the High Court:

13

Provided that the Appellate Tribunal may, if it is satisfied that the applicant was prevented by sufficient cause from presenting the application within the period hereinbefore specified, allow it to be presented within a further period not exceeding thirty days.

20

(2) If the Appellate Tribunal refuses to state the case Which it has been required to do, on the ground that no question of law arises, the dealer or the Commissioner, as the case may be, may, within thirty days of the communication of such refusal either withdraw his application (and if he does so, any fee paid shall be refunded), or apply to the High Court against such refusal.

25

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

30

(4) If the High Court is not satisfied that the statements in a case referred to it are sufficient to enable it to determine the questions raised thereby, the Court may refer the case back to the Appellate Tribunal for the purpose of making such additions thereto or altera- tions therein as it may direct in that behalf.

35

(5) 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 Appellate Tribunal a copy of such judgment under the seal of the Court and the signature of the Registrar, and the Appellate Tribunal shall dispose of the case accordingly.

(7) The payment of the amount of tax and penalty (if any) due in accordance with the order of the Appellate Tribunal in respect of

which an application has been made under sub-section (/) 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 ac- cordance with the provisions of section 27. 5

Revision of orders prejudi- cial to revenue.

io

15 39. The Commissioner may call for and examine the record of any proceeding under this Act, and if he considers that any order passed therein by any officer appointed under sub-section (2) of section 9 to assist him, is erroneous in so far as it is prejudicial to the interest of the revenue, he may, after giving the dealer an opportunity of being heard and after making or causing to be made such inquiry as he deems necessary pass such order thereon as the circumstances of the case justify, including an order enhancing or modifying the assess- ment and penalty (if any) imposed, or cancelling the assessment and penalty (if any) imposed and directing a fresh assessment:

Provided that no proceedings under this sub-section "hall be initiat- ed after the expiry of two years from the date of the order sought to be revised.

20 Revision of other orders.

25 40. (7) In the case of any order, other than aa order referred to m section 37 or to which section 3" applies, passed by an officer appointed under sub-section (2) of section 9 to assist him, the Commissioner may, either on his own motion or on an application filed in accordance with such rules as may be prescribed, call for the record of any pro- ceeding under this Act in which any such order has been passed and may make such inquiry or cause such inquiry to be made and, subject to the provisions of this Act, may pass such orders thereon, not being an order prejudicial to the assessee, as he thinks fit:

Provided that the Commissioner shall not revise any order under

this sub-section,—

30 (a) where an appeal against the order is pending before the appellate authority under section 88; or

(b) where, if such appeal lies, the time within which it may be filed has not expired; or

(c) where in the case of the second appeal, the dealer has not

35 waived his right of appeal.

(2) The Commissioner shall not of his own motion revise any order under this section if the order has been made more than one year previously.

(3) In the case of an application for revision under this section by the dealer, the application must be made within one year from the 40

date on which the order in question was communicated to him or the date on which he otherwise comes to know of it, whichever is earlier.

Rectifica- tion of mistakes.

5

41. (2) The Commissioner or any person appointed under sub-section (2) of section 9 to assist him, may at any time within two years from the date of any order passed by the Commissioner or by that person, as the case may be, on his own motion, rectify any mis- take 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:

10

15

Provided that, no such rectification shall be made if it has the effect of enhancing the tax or reducing the amount of a refund, unless the Commissioner Or the person appointed under sub-section (2) of section 9 to assist him, as the case may be, has given notice in writing to the person likely to be affected by the order 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 rectifica- tion of a mistake by an appellate authority under section 36 as they apply to the rectification of a mistake by the Commissioner.

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

25

(4) Where any such rectification has the effect of enhancing the amount of the tax or penalty or reducing the amount of the refund, the Commissioner shall recover the amount due from such person in the manner provided for in Chapter V.

CHAPTER IX

OFFENCES AND PENALTIES

42. Whoever—

Offences.

30

(a) holds, produces or accepts a declaration under the first proviso to sub-clause (iv) of clause (a) of sub-section (2) of section 4 which he knows or has reason to believe to be false; or

(b) carries on business as a dealer in contravention of sub- section (1) of section 13 or sub-section (1) of section 16; or(c) not being a registered dealer, falsely represents when 35 purchasing goods that he is a registered dealer; or 508 G of I—5

(d) being a registered dealer, falsely represents when pur- chasing any goods or class of goods, that such goods or class of gqods are covered by his certificate of registration; or

(e) fails to comply with the provisions of sub-section (5) of section 19; or

5 (f) fails, without sufficient cause, to submit any return as required by sub-section (2) of section 20 or submits a false return; or

(g) contravenes the provisions of section 21 or of sub-sec- tion (2) or sub-section (3) of section 56; or

10 (ft) fails, when required so to do under section 32, to keep accounts (including records of sales) specified in the notice; or

(i) knowingly maintains or produces incorrect accounts, re- gisters or documents or knowingly furnishes incorrect informa- tion; or

IS (j) neglects to furnish any information required by section 33; or

(7c) refuses to comply with any requirements made of him under section 34; or

20 (I) obstructs or prevents any officer making inspection, search or seizure under section 34 or performing any functions under section 56, as the case may be; or

(m) aids or abets any person in the commission of any offence specified in clauses (a) to (I),

25 shall be punishable with simple imprisonment which may extend to six months, or with fine, or with both, and when the offence is a continuing one, with a daily fine not exceeding fifty rupees during the period of the continuance of the offence:

3o Provided that no prosecution for an offence against this Act shall be instituted in respect of the same facts in respect of which a penalty has been imposed under sub-section (6) of section 19, sub-section (6) of section 22, section 47, section 48 or section 49.

35 43. (1) Where an offence under this Act 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 deem- ed 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 he40

proves that the offence was committed without his knowledge or that he exercised all due diligence to prevent the commission of such offence.

5

i"

(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 conni- vance of, or that the commission of the offence 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 purposes of this section,—

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

15

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

Cogni- zance of offences.

44. (1) No court shall take cognizance of any offence under this Act or rules made thereunder except with the previous sanction of the Commissioner, and no court inferior to that of a magistrate of the first class shall try any such offence-

20

5 of 1898.

(2) Notwithstanding anything contained in the Code of Criminal Procedure, 1898, all offences punishable under this Act or rules made thereunder shall be cognizable and bailable.

25

Investiga- tion of offences.

45. (1) Subject to such conditions as may be prescribed, the Com- missioner may authorise either generally or in respect of a particular case or class of cases any person appointed under sub-section (2) of section 9 to assist him to investigate all or any of the offences punish- able under this Act.

5 of 1898. 3<>

(2) Every person so authorised shall, in the conduct of such in- vestigation, exercise the powers conferred by the Code of Criminal Procedure, 1898, upon an officer in charge of a police station for the investigation of a cognizable offence.

Composi- tion of offences.

35

46. (I) Subject to such conditions as may be prescribed, the Com- missioner may accept, from any person alleged to have committed an offence under section 42 or under any rules made under this Act, either before or after the commencement of any proceedings against such person in respect of such offence, by way of composition for such offence, a sum not exceeding five thousand rupees or where the offence alleged to have been committed is under any of the clauses (a), (b),

(c), (d) and (f) of that section, not exceeding double the amount of the tax which would have been payable by such person had he com- plied with the provisions of this Act, whichever is higher.

(2) On payment in full of such sum as may be determined by

5 the Commissioner under sub-section (/),—

(a) no proceedings shall be commenced against such person

as aforesaid; and

10 (b) if any proceedings have been already commenced against such person as aforesaid, such proceedings shall not be further proceeded with.

Penalty for failure to submit return.

15

2" 47. If a registered dealer fails, without reasonable cause, to furnish any return as required by sub-section (2) of section 20 or to pay the tax due according to the return as required by sub-section (3) of that section within the prescribed period, or if a dealer on whom a notice has been served under sub-section (2) of the said section fails likewise to furnish the return within the prescribed period, the Com- missioner may, after giving the dealer an opportunity of being heard, direct that the dealer shall pay, by way of penalty, in addition to the amount of tax payable, a sum not exceeding one and a half times that amount, or where no tax is payable, a sum not exceeding one thousand rupees.

Z5

30 Penalty for con- cealment of sales or furnishing inaccurate particu- lars or making false represen- tations,

48. (1) If the Commissioner or any person appointed under sub- section (2) of section 9 to assist him, in the course of any proceedings under this Act is satisfied that a dealer has concealed the particulars of his sales or has furnished inaccurate particulars of his sales and has thereby returned figures below the real amount, he may, after giving the dealer a reasonable opportunity of being heard, direct that the dealer shall pay, by way of penalty, in addition to the amount of tax payable, a sum not exceeding one and a half times the amount of tax which would have been avoided if the figures returned by the dealer were accepted as correct.

35 (2) If a person commits an offence under clause (a) of section 42, the Commissioner or any person appointed under sub-section (2) of section 9 to assist him may, after giving that person a reasonable opportunity of being heard, by order in writing, impose upon such person by way of penalty a sum not exceeding one and a half times the amount of tax which would have been payable in respect of the sale of goods involved as if such sale of goods was liable to tax.

(3) If a person purchasing goods commits an offence under clause (c) or clause (d) of section 42, the authority which granted

5

him or as the case may be, is competent to grant him a certificate of registration under this Act, may, after giving him a reasonable oppor- tunity of being heard, by order in writing, impose upon him by way of penalty, a sum not exceeding one and a half times the tax which would have been levied under this Act in respect of the sale to him of the goods, if the offence had not been committed.

49. If any person acts in contravention of the provisions of sec-

tion 21, he shall be liable to a penalty not exceeding one and a half times the tax wrongly collected:

10

Penalty for con- travening provision regarding collection of tax by dealers.

Provided that the Commissioner shall not impose any such penalty unless the person concerned has been given an opportunity of being heard.

CHAPTER X

MISCELLANEOUS

15

50. (1) After a Hindu undivided family has been partitioned, notices under this Act shall be served on the person who was the last manager of the Hindu family, or if such person is dead, then on all adults who were members of the Hindu family immediately before the partition.

(2) Where a firm or an association of persons is dissolved, notices

Service of notice when family is disrupted or firm is dis- solved.

20

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.

*5

51* Where an assessment is to be made in respect of business which 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 or in the case of a company on the principal officer thereof.

Service of notice in the case of discon- tinued ibusiness.

3

52. (1) Any person, who is entitled or required to attend before any authority in connection with any proceeding under this Act, may attend—-

(a) by a person authorised by him in writing in this behalf,

being a relative or a person regularly employed by him; or

Appear- ance before any authority in pro- ceedings-

(b) by a legal practitioner or chartered accountant, who Isnot disqualified by or under sub-section (2); or 35 (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 (2).

5 (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 practi- tioner, chartered accountant or sales tax practitioner—

(i) who has been removed or dismissed from Government Bervice; or

10 (u) who being a legal practitioner or chartered accountant is found guilty of misconduct in connection with any proceed- ings under this Act by an authority empowered to take discipli- nary action against the members of the profession to which he belongs; or

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

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

20 (4) Any person against whom any order of disqualification is made under this section may within one month of the date of com- munication of such order appeal to the Administrator to have the order cancelled.

(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.

25

(6) The Commissioner may at any time suo moto 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.

30 Change of an incumbent of an office.

53- Whenever in respect of any proceeding under this Act the Commissioner or any person appointed under sub-section (2) of section 9 to assist him, ceases to exercise jurisdiction and is succeed- ed by another 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:

35 Provided that the dealer concerned may demand that before the proceeding is so continued, the previous proceeding or any part thereof be re-opened or that before any order of assessment is passed against aim, he be re-heard.

54. (1) An appellate authority may admit an appeal under sec- tion 36 after the period of limitation laid down in that section, if the appellant satisfies the appellate authority that he had sufficient cause for not preferring the appeal within such period.

Extension of period of limita- tion in certain cases.

5

16 of 1963.

(2) In computing the period laid down under sections 36, 38, 39 and 40 the provisions of sections 4 and 12 of the Limitation Act, 1963, shall, so far as may be, apply.

10

Returns, etc.. to toe confiden- tial.

1 of 1872.

55. (1) All particulars contained in any statement made, return furnished or accounts or documents produced in accordance with this Act, or in any record of evidence given in the course of any proceedings under this Act other than proceedings before a cri- minal court, shall, save as provided in sub-section (3), be treated as confidential, and notwithstanding anything contained in the Indian Evidence Act, 1872, no court shall, save as aforesaid, be entitled to 15 require any servant of the Government to produce before it any such statement, return, account, document or record or any part thereof, or to give evidence before it in respect thereof.

20

(2) If, save as provided in sub-section (3), any servant of the Government discloses any of the particulars referred to in sub- section (1), he shall be punishable with imprisonment which may extend to six months, and shall also be liable to fine.

(3) Nothing in this section shall apply to the disclosure—

45 of 1860.

(a) of any of the particulars referred to in sub-section (I) for the purposes of a prosecution under the Indian Penal Code or the Prevention of Corruption Act, 1947 or this Act; or

2 of 1947. 25

(b) of such facts to an officer of the Central Government or any State Government, aa may be necessary for verification of such facts or for the purposes of enabling that Government to levy or realise any tax imposed by it; or

30 (c) of any such particulars where such disclosure is occa- sioned by the lawful employment under this Act of any process for the service of any notice or the recovery of any demand; or

35

(d) of any such particulars to a civil court in any suit or proceeding to which the .Government or any sales tax authority is a party and which relates to any matter arising out of any proceeding under this Act or under any other law for the time being in force authorizing any sales tax authority to exercise any powers thereunder; or(e) of any such particulars by any public servant where the disclosure is occassioned by the lawful exercise by him of his 40

2 of 1899. powers under the Indian Stamp Act, 1899, to impound an in- sufficiently stamped document; or

(f) of any such particulars to the Reserve Bank of India

5 as are required by that Bank to enable it to compile financial statistics of international investment and balance of payment; or

(g) of any such particulars to any officer appointed by the Comptroller and Auditor-General of India for purpose of audit of tax receipts or refunds; or

10 (h) of any such particulars relevant to any inquiry into a charge of misconduct in connection with income-tax proceed- ings against a legal practitioner or chartered accountant, to the authority empowered to take disciplinary action against members of the profession to which he belongs; or

15 (i) of such particulars to the officers of the Central Gov- ernment or any State Government for such other purposes, as the Administrator may by general or special order direct.

20 Setting up of check- posts and barriers.

56. (1) The Administrator may, by notification in the Official Gazette, set up check-posts or barriers, or both, at any place in Delhi with a view to preventing evasion of tax and other dues payable under this Act.

35

30 (2) The owner or person in-charge of a goods vehicle shall carry with him a goods vehicle record, a trip sheet or a log book as the case may be, and a bill of sale or a delivery note containing such particulars as may be prescribed in respect of the goods carried In the goods vehicle and produce the same before any officer in-charge of a check-post or barrier or any other officer as may be empowered by the Administrator in this behalf. The owner or person in-charge of a goods vehicle entering or leaving Delhi shall also file a declara- tion containing such particulars in such form and in such manner as may be prescribed, before the officer in-charge of a check-post or barrier or before the other officer empowered as aforesaid.

3540 (3) At every check-post or barrier, or at any other place when so required by an officer empowered by the Administrator in this behalf, the driver or any other person in-charge of a goods vehicle shall stop the vehicle and keep it stationary as long as may be re- quired by the officer incharge of the check-post or barrier or the officer empowered as aforesaid, to examine the contents In the vehicle and inspect all records relating to the goods carried, which are in the possession of such driver or other person in-charge, who

shall, if so required, give h's name and address and the name and address of the owner of the vehicle HS well as those of the consignor and consignee of the goods,

5

(4) The tiffin t' ineharge of a chock-post or barrier or the officet empowered under dub-section (3) shall have power to seize and confiscate any goods which are under transport by a goods vehicle and which are not covered by a goods vehicle record, -r\ trip sheet or a log book, as the case may be, and a bill of sale or a delivery note and. when the goods vehicle enters or leaves Delhi, the declara- tion referred to in sub-section (2) aUo.

10

(,5) Where the declaration made under sub-section (2) is false in respect of the materials furnished therein, the officer incharge of the check-post or barrier of any other officer empowered in this behalf shall have the power to seize and confiscate the goods in respect of which the declaration is false:

ij

Provided that before taking action for confiscation of goods under this section the officer shall give the person affected an opportunity of being heard and maku an inquiry in the manner prescribed.

20 (6') Whenever confiscation is authorised by this section the officer adjudging it shall give the owner or person incharge of the goods an option to pav in lieu of confiscation—

(a) in cases where the goods are such as are specified in the Third Schedule, one thousand rupees or one-half of thf estimated value of goods, whichever is less; and

25

(b) in other cases, without prejudice t<- recovery of the tax payable, a sum of money t'nual to ten per cent, of the estimated value of the goods.

3o

List of registered dealers.

57. The Commissioner shall, from time to time, publish in the Official Gazette such particulars as may be prescribed of any dealer who after the commencement of this Act is registered or whose cer- tificate of registration is amended or cancelled, as soon as may be, after such registration, amendment or cancellation-

.Exemp- tions.

3558. (1) If the Administrator is of opinion that it is necessary or expedient in the public interest so to do, he may, with the previous approval of the Central Government, oxempi, by notification in the Official Gazette and subject to such conditions, if any, as he may impose, any specified class of sales by any specified class of dealers from payment of the whole or any part of the tax payable under this Act, 40

(2) If in respect of any sales which are exempt from payment of tax under sub-section (2), a breach of any of the conditions sub- ject to which such exemption was granted is committed, the dealer responsible for such breach shall be liable to pay tax in respect of all such sales as if no such exemption had been granted. 5

Bar of suits in civil courts.

10 59. No suit shall be brought in any civil court to set aside or modify any assessment made or any order passed under this Act or the rules made thereunder, and no prosecution, suit or other pro- ceeding shall lie against the Government or any officer of the Gov- ernment for anything in good faith done or intended to be done under this Act or the rules made thereunder.

Power to make rules.

60. (1) The Administrator may, subject to the condition of pre- vious publication, make rules for carrying out the purposes of this Act.

15 (2) In particular and without prejudice to the generality of the foregoing powers, such rules may provide for—

(a) the further period after the date of expiry of three consecutive years referred to in sub-section (3) of section 3 for which liability to pay tax of a dealer shall continue;

20 (b) the particulars to be contained in a declaration under

sub-clause (iv) of clause (a) of sub-section (2) of section 4, the form of such declaration, the authority from whom such forms shall be obtainable and the manner in which such decla- ration is to be furnished;

25 (c) the period of turnover, the manner in which the turn- over in relation to sale of any goods under this Act shall be determined, and the sales turnover in respect of which may be deducted under sub-clause (vi) of clause (a) of sub-section (2) of section 4;

(d) the restrictions and conditions subject to which the

Commissioner may delegate his powers under section 10;

(e) the authority to whom applications for registration

under sections 13, 14, 15 and 16 may be made and the form of such applications and the fees payable in respect thereof;

35 (f) the procedure for and other matters incidental to re-

gistration of dealers and the granting of certificates of registra- tion, and the forms of such certificates;

(g) the intervals at which, and the manner in which, the

tax under this Act shall be payable under section 20;

(h) the returns to be furnished under sub-section (2) ot section 20 and dates by which, and the authority to whom, such returns shall be furnished:

(i) the procedure to be followed for assessment under sec* tion 22;

5

(j) the circumstances in which and the conditions subject to which a dealer may be permitted to pay a lump sum by way of composition under section 26 and the manner of determining such sum;

lo (Jc) the form in which claims for refund or set-off may be preferred, the manner In which such claims for refund shall bo verified, and the refunds or set-off under this Act shall be allowed;

(I) the authority to whom information shall be furnished under section 33;

(5

(m) the conditions under which the production of accounts or documents or the furnishing of information may be required under sub-section (I) of section 34;

20

(n) the form and manner in which, and the authority to whom, appeals against assessment may be filed under section 36, the fee payable in respect thereof and the procedure to be followed by such authority;

(o) the form and manner in which applications for revision under section 40 may be filed and the fee payable in respect thereof;

*5

(p) the conditions subject to which the Commissioner may authorize the persons appointed under sub-section (2) of section 9 to assist him to investigate offences under sub-section (1) of section 45;

(q) the conditions under which offences may be compound- 3o

ed under section 46;

(r) the manner in which, and the time within which, appli- cations shall be made (including fees payable in respect thereof), information furnished, securities given and notices served, under this Act;

35

(s) any other matter which has to be or may be prescribed.

day during which such conlra\ mtion continues after conviction for the first such contravention.

61. Every rule made under this Act and every notification issued

5 Hutes und certain notiflen- tions to L"e> laid before Parlia- ment

10

15 under clause (b) ur clause {c) of sub-section (1) of section 4, the Erst proviso to sub-section (J) of that section and sub-section (2) of section 7 shall be Jaid, as soon as may be after it is made or issued, before each House of Parliament, while ii is in session for a total period of thirty days which may be comprised in one session or in two successive sessions, and if, before the expiry of the session in which it is so Jaid or the session immediately following, both Houses 'igreo in making any modification in the rule or notification or both Houses agree that the rule' should not be made or the notification should not be issued, the rule <>r notification shall thereafter have effect only in such modified foirn or be of no effect, as the case may he; so, however, that any such modification or annulment shall be without prejudice to thr validity of anything previously done under 'bat rule or notification.

62. (1) The Bengal Finance (Sales Tax) Act, 1941, as in force in Delhi (hereinafter referred to as the said Act) is hereby repealed:

Repeal and s.. vings.

20 Provided that such repeal shall not affect the previous operation of the said Act or any right, title, obligation or liability already bc- quired, accrued or incurred thereunder and subject thereto, any- thing done or any action taken including any appointment, notifica- tion, notice, order, rule, form or certified I e in the exercise of any power conferred by or under 1be said Act shall he deemed to have been done or taken in the exercise of the powers conferred by or under this Act. 03 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 amounts due at the commencement of this Act may be recover- ed an if they had accrued under this Ac^

3> (2) JNnUvithsLandiny anything contained in sub-section (/), any application, appeal, revision or other proceeding made or preferred to any officer or authority under the said Act and pending at the commencement of this Act, shall, after such commencement, he transferred to and disposed of by the officer or authority who would have had jurisdiction to entertain such application, appeal, revision or other proceeding under this Act if it had been in force on the date on which any application, appeal, revision or other proceeding 'VJH made or preferred'

Provided that for the purpose of disposing any such revision pending at the commencement of this Act, the period of. limitation for a second appeal referred to in sub-section (3) of section 36 of this Act shall bo reckoned from the date of such commencement.

Hemuval of diffi- i-ullies.

5 UU. 0) U any difficulty arises in giving effect to the provisions of ih'.s Act. ULL Central G wrnment may, by order published in the Official Gazette, make .iLioh provision or give such direction as pp- pears to it In 1H> necrsnary 1'ov removing;' the difficulty.

IO

(2) An order under sub-section U) may be made so as to have retrospective, effect iroin a date noi earlier than the date of the commencement of this Act,

THE FIRST SCHEDULE

[See section 4(1) (a)]

1. Motor vehicles, including chassis of motor vehicles, motor tyres and tubes, accessories and spare parts of motor vehicles. 2. Motor cycles and cyle combinations, motor scooters, motorettes and tyres and tubes, accessories and spare parts of motor cycles, motor scooters and motorettes.

3. Refrigerators and air-conditioning plants and component parts thereof.

j

4. Wireless reception instruments and apparatus, radios and radio gramophones, electrical valves, accumulators, amplifiers and loud-speakers and spare parts and accessories thereof.

5. Cinematographic equipment including cameras, projectors and sound recording and reproducing equipment, lenses, films and parts and accessories required for use therewith.

6. Photographic and other cameras and enlargers, lenses, films and plates, paper and cloth and other parts and accessories re- quired for use therewith and photographs.

7. All clocks, time-pieces and watches and parts thereof.

8. Iron and steel safes and almirahs.

9. All arms including rifles, revolvers, pistols and ammunition for the same.

10. Cigarette cases and lighters.

11. Dictaphone and other similar apparatus for recording sound and spare parts thereof.

12. Sound transmitting equipment including telephones and loud- speakers and spare parts thereof.

13. Typewriters, tabulating machines, calculating machines and duplicating machines and parts thereof.

14. Binoculars, telescopes and opera glasses.

15. Gramophones and component parts thereof and records.

16. Motor spirit, aviation spirit and high speed diegel oil

17. Cosmetics, but not including kum-kum and soap.

18. Electrical goods, other than electrical plant, equipment and their accessories including service meters required for genera- tion, transmission and distribution.

19. Pile carpets.

20. Table cutlery.

21. Sanitary goods and fittings.

22. Leather goods except footwear.

23. Glassware, glazedware and chinaware, including crockery.

24. Furniture, including iron and steel furniture.

25. Vacuum flasks.

26. Liquor (foreign liquor and Indian-made foreign liquor).

THE SECOND SCHEDULE

[See section 4(1) (b)]

1. Coal including coke in all its forms.

2. Cotton as defined in section 14 of the Central Sales Tax Act, 1956 (74 of 1956).

3. Iron and steel as defined in section 14 of the Central Sales Tax Act, 1956 (74 of 1956).

4. Jute as defined in section 14 of the Central Sales Tax Act, 1956 (74 of 1956).

5. Oilseeds as denned in section 14 of the Central Sales Tax Act, 1956 (74 of 1956).

6. Hides and skins, whether in a raw or dressed state.

7. Cotton yarn, but not including cotton thread and cotton yarn waste.

THE THIRD SCHEDULE

(See section 7)

EXEMPTED GOODS

1. All cereals and pulses including all forms of rice (except when sold in sealed containers). This shall not include rice in cooked form.

2, Flour including atta, maida, suji and bran (except when sold in sealed containers).