BENGAL FINANCE (SALES TAX) ACT, 1941

Preamble - BENGAL FINANCE (SALES TAX) ACT, 1941

THE BENGAL FINANCE (SALES TAX) ACT, 1941[1]

[Act No. 06 of 1941]

PREAMBLE

Whereas it is necessary to make an addition, to the revenues of Bengal, and for that purpose to impose a general tax on the sale of goods in Bengal;

It is hereby enacted as follows:-

Section 1 - Short title, extent and commencement

(1)     This Act may be called the Bengal Finance (Sales Tax) Act, 1941.

 

(2)     It extends to the whole of the Union territory of Delhi.

 

(3)     It shall come into force on such date as the Chief Commissioner may, by notification in the Official Gazette, [2] appoint.

Section 2 - Definitions

In this Act, unless there is anything repugnant in the subject or context,-

(a)      "Commissioner" means the Commissioner of Sales Tax appointed under sub-section (1) of section 3;

 

(b)      [3] [Omitted.]

 

(c)      "dealer" means any person who carries on the business of selling goods in the Union territory of Delhi and includes the Government.

Explanation 1.-A co-operative society or a club or any association which sells goods to its members is a dealer.

Explanation 2.-A factor, a broker, a commission, agent a del credere agent, an auctioneer or any other mercantile agent, by whatever name called, and whether of the same description as hereinbefore mentioned or not, who carries on the business of selling goods and who has, in the customary course of business, authority to sell goods belonging to principals is a dealer.

Explanation 3.-The manager or an agent in the Union territory of Delhi or a dealer who resides outside the Union territory of Delhi and carries on the business of selling goods in the Union territory of Delhi shall, in respect of such business, be deemed to be a dealer;

(d)      "goods" includes all materials, commodities and articles but does not include [4] [newspapers] actionable claims, stocks, shares, securities or money.

Explanation [5] [Omitted].

(e)      "prescribed" means prescribed by rules made under this Act;

 

(f)       "registered" means registered under this Act;

 

(g)      [6]"sale", with its grammatical variations and cognate expressions means any transfer of property in goods by one person to another for cash or for deferred payment or for any other valuable consideration, and includes a transfer of goods on hire-purchase or other system of payment by installments, but does not include a mortgage or hypothecation of or a charge or pledge on goods.

Explanation.-A sale or purchase of goods shall be deemed to take place inside the Union territory of Delhi if the goods are within that territory-

(i) in the case of specific or ascertained goods, at the time the contract of sale is made; and

(ii) in the case of unascertained or future goods, at the time of their appropriation to the contract of sale by the seller or by the buyer, whether assent of the other party is prior or subsequent to such appropriation;

(h)     "sale price" means the amount payable to dealer as consideration for the sale of any goods, less any sum allowed as cash discount according to the practice normally prevailing in the trade, but inclusive of any sum charged for anything done by the dealer in respect of the goods at the time of or before the delivery thereof other than the cost of freight or delivery or the cost of installation in cases where such cost is separately charged;]

(i)       "turnover" used in relation to any period means the aggregate of the sale-prices or parts of sale-prices receivable, or if a dealer so elects, actually received by the dealer during such period after deducting the amounts if any refunded by the dealer in respect of any goods returned by the purchaser within such period:

Provided that an election as aforesaid once made shall not be altered except with the permission of the Commissioner and on such terms and conditions as he may think fit to impose;

(j)       [[7]"year" means the financial year].

Section 3 - Taxing Authorities

(1)     For carrying out the purposes of this Act, the Chief Commissioner may appoint a person to be Commissioner of Sales Tax, together with such other person to assist him as the Chief Commissioner thinks fit.

 

(2)     Persons appointed under sub-section (1) shall exercise such powers as may be conferred, and perform such duties as may be required, by or under this Act.

 

(3)     All persons appointed under sub-section (1) shall be deemed to be public servants within the meaning of section 21 of the Indian Penal Code (45 of 1860).

Section 4 - Incidence of taxation

(1)     With effect from such date as the Chief Commissioner may, by notification in the Official Gazette, appoint being not earlier than thirty days after the date of the said notification, every dealer whose gross turnover during the year immediately preceding the commencement of this Act exceeded the taxable quantum shall be liable to pay tax under this Act on all sales effected after the date so notified:

Provided [9] [* * * *] that a dealer who deals exclusively in one or more classes of goods specified in the[10] [Second Schedule] shall not be liable to pay any tax under this Act.

(2)     Every dealer to whom sub-section (1) does not apply, shall, if his gross turnover calculated from commencement of any year exceeds the taxable quantum at any time within such year, be liable to pay tax under this Act, on the expiry of two months from the date on which such gross turnover first exceeds the taxable quantum, on all sales effected after such expiry.

Explanation.-In this sub-section, and in sub-section (4) the expression "period" means a period not exceeding twelve months from the commencement of a year.

(3)     Every dealer who has become liable to pay tax under this Act shall continue to be so liable until the expiry of three consecutive years, during each of which his gross turnover has failed to exceed the taxable quantum and such further period after the date of such expiry as may be prescribed, and on the expiry of this latter period his liability to pay tax shall cease.

 

(4)     Every dealer whose liability to pay tax under this. Act has ceased under the provisions of sub-section (3), shall, if his gross turnover calculated from the commencement of any year again exceeds the taxable quantum at any time within such year, be liable to pay such tax on the expiry of two months from the date on which such gross turnover again first exceeds the taxable quantum on all sales effected after such expiry.

[11] [(4-A) Any dealer whose certificate of registration granted either under section 7 or section 8 has been cancelled under sub-section (7) of section 7 or under sub-section (2) of section 8 shall, if his gross turnover calculated from the commencement of any year or from any date within the year exceeds the taxable quantum at any time within such year, be liable to pay such tax on the expiry of two months from the date on which such gross turnover again first exceeds the taxable quantum on all sales, effected after such expiry of goods imported from outside the Union territory of Delhi or manufactured in the Union territory of Delhi.]

[12] [(4-B) Every dealer shall, notwithstanding that he is not liable to pay tax under any of the sub-sections (1), to (4A), be liable to pay tax under this Act so long as he is registered under the Central Sales Tax Act, 1956 (74 of 1956) on all sales effected by him or on his behalf within the Union territory of Delhi on or after the date of his liability or the date of his registration, whichever is earlier, under the Central Sales Tax Act aforesaid.]

[13] [(5) In this Act, the expression "taxable quantum" means-

[14] [(a) in relation to any dealer who imports for sale any goods into the Union territory of Delhi or manufactures or produces any goods for sale, regardless of the value of the goods imported, manufactured or produced, ten thousand rupees;]

(b) in relation to any other dealer, thirty thousand rupees:

Provided that if the Chief Commissioner is of opinion that having regard to the difficulty in maintaining accounts or other sufficient cause the taxable quantum in respect of any class of dealers falling under clause (a) should be increased, the Chief Commissioner, with the previous approval of the Central Government, may fix in respect of such class of dealers such taxable quantum, not exceeding thirty thousand rupees as may be specified in the notification.]

Section 5 - Rate of tax

[15] [(1) The tax payable by a dealer under this Act shall be levied-

(a)      in the case of taxable turnover in respect of the goods specified in the First Schedule, at the rate of seven naye paise in the rupee;

 

(b)      in the case of taxable turnover in respect of the goods specified in the Third Schedule, at the rate of two naye paise in the rupee;

 

(c)      in the case of taxable turnover in respect of any other goods, at the rate of four naye poise in the rupee:

Provided that the Chief Commissioner, with the previous approval of the Central Government, may, by notification in the Official Gazette, add to, or omit from, or otherwise amend the First and the Third Schedules:

Provided further that if in respect of any goods or class of goods the Chief Commissioner, is of opinion that it is expedient in the interest of the general public so to do, the Chief Commissioner, with the previous approval of the Central Government, may, by notification in the Official Gazette, direct that the tax in respect of the taxable turnover of such goods or class of goods shall, subject to such conditions as may be specified, be levied at such modified, rate not exceeding the rate applicable under this sub-section as may be specified in the notification.]

[16] [(1A) The Chief Commissioner or any other person authorised by him in this behalf may permit dealers in such circumstances and under such conditions as may be prescribed to compound the tax assessable on their taxable turnover under the provisions of this Act, by paying in lieu thereof a lump sum in such manner as may be prescribed.]

(2) ???In this Act the expression "taxable turnover" means that part of a dealer's gross turnover during any period which remains after deducting therefrom-

(a)      his turnover during that period on- of goods of the class or classes specified in the certificate of registration of such dealer, as being intended for re-sale by him, or for use by him as raw materials in the manufacture of goods for sale; and

 

(i)       the sale of goods declared tax-free under section 6;

(ii)      [17] [sale to a registered dealer- of containers or other materials for the packing of goods of the class or classes so specified for sale:

Provided that in the case of such sales a declaration duly filled up and signed by the registered dealer to whom the goods are sold and containing the prescribed particulars on a prescribed form obtainable from the prescribed authority is furnished in the prescribed manner by the dealer who sells the goods:

Provided further that where any goods specified in the certificate of registration are purchased by a registered dealer as being intended for re-sale by him or for use by him as raw materials in the manufacture of goods for sale, but are utilised by him for any other purpose, the price of the goods so purchased shall be allowed to be deducted from the gross turnover of the selling dealer but shall be included in the taxable turnover of the purchasing dealer.]

(iii)     sales to a registered dealer engaged in the business of raising coal, of any goods which are shown to the satisfaction of the Commissioner to be required directly for use in connection with the raising of coal;

 

(iv)    sales to any undertaking supplying electrical energy to the public under a licence or sanction granted or deemed to have been granted under the Indian Electricity Act, 1910 (9 of 1910) of goods for use by it in the generation or distribution of such energy;

 

(v)      sales of goods which are shown to the satisfaction of the Commissioner to have been despatched by, or on behalf of the dealer to an address outside the Union territory of Delhi;

 

(vi)    such other sales as may be prescribed,

[18] [* * * * * *]

Section 5A - Power of Chief Commissioner to prescribe points at which goods may be taxed

[Notwithstanding anything to the contrary in this Act. The Chief Commissioner may, by notification in the Official Gazette, specify the point in the series of sales by successive dealers at which any goods or class of goods may be taxed.]

Section 5B - Burden of proof

[19] [The burden of proving that in respect of any sale effected by the dealer he is not liable to pay tax under this Act shall lie on him.]

Section 6 - Tax-free goods

(1)     No tax shall be payable under this Act on the sale of goods specified in the [20] [Second Schedule] subject to the conditions and exceptions, if any, set out therein.

 

(2)     The Central Government, after giving by notification in the Official Gazette, [21] [such previous notice as it considers reasonable] of its intention so to do, may by like notification add to or omit from or otherwise amend the "[Second] schedule, and thereupon the [22] [Second] schedule shall be deemed to be amended accordingly.

Section 7 - Registration of dealer

(1)     No dealer shall, while being liable to pay tax under section 4 of this Act, carry on business as a dealer unless he has been registered and possesses a registration certificate.

 

(2)     Every dealer required by sub-section (1) to be registered shall make application in such behalf in the prescribed manner to the prescribed authority.

 

(3)     If the said authority is satisfied that an application for registration is in order, he 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 class or classes of goods for the purposes of sub-clause (ii) of clause (a) of sub-section (2) of section 5.

 

(4)     The Commissioner may from time to time amend any certificate of registration in accordance with information, furnished under section 16 or otherwise received.

 

(5)     When any dealer has been convicted or has paid composition money under section 23, in respect of any contravention of sub-section (1) of this section, the Commissioner shall register such dealer and grant him a certificate of registration, and such registration shall take effect as if it had been made under sub-section (3) of this section on the dealer's application.

 

(6)     When-

 

(a)      any business in respect of which a certificate has been granted to a dealer on an application made, has been discontinued or transferred, or

 

(b)      a dealer has ceased to be liable to pay tax under section 4 of this Act, the Commissioner shall cancel the registration.

(7)     [23] [The Commissioner may at any time for reasons to be recorded in writing and after giving the dealer an opportunity of being heard, cancel any certificate of registration.]

Section 8 - Voluntary Registration

(1) ??Any dealer [24] [other than a dealer who deals exclusively in one or more classes of goods specified in the[25] [Second Schedule] whose gross turnover during a year exceeds 10,000 rupees may, notwithstanding that he may not be liable to pay tax under section 4, apply in the prescribed manner to the prescribed authority for registration under this Act.

[26] [(2) The provisions of sub-section (3), sub-section (4), clause (a) of sub-section (6) and sub-section (7) of section 7 shall apply in respect of applications for registration under this section.]

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

(4) ??The registration of a dealer upon application made 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) ??Subject to the provisions of sub-section (4), a dealer registered upon application made under this section may apply in the prescribed manner not less than six months before the end of a year to the authority which granted him his certificate of registration for the cancellation of such registration to take effect at the end of the year in which the application for such cancellation is made; and the said authority shall, unless the dealer is liable to pay tax under section 4, cancel the registration accordingly.

Section 8A - Security from certain classes of dealers

[27] [The Commissioner, if it appears to him to be necessary so to do for the proper realisation of the tax levied under this Act, may impose for reasons to be recorded in writing as a condition of the issue of a registration certificate to a dealer or of the continuance, in effect, of such a certificate issued to any dealer a requirement that the dealer shall give security up to an amount and in the manner approved by the Commissioner for the payment of the tax for which he may be or become liable under this Act.]

Section 8B - Provisional Registration

[28] [(1) Any person who intends to establish a business in the Union territory of Delhi for the purpose of manufacturing or producing goods of a value exceeding ten thousand rupees per year, [29] * * * * *] may, notwithstanding that he is not required to register himself under section 7 apply in the prescribed manner to the prescribed authority for provisional-registration under this Act.

(2) ??If the said authority, after making such inquiries 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 class or classes of goods, for the purposes of sub-clause (ii) of clause (a) of sub-section (2) of section 5.

(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 and the provisions of sub-sections (4), (6) and (7) of section 7 shall, so far as may be, apply to any such certificate of registration.

Section 8C - Special Registration

(1)     No dealer shall, while being liable to pay tax under sub-section (4A) of section 4, carry on business as a dealer unless he has obtained a special certificate of registration.

 

(2)     Every dealer required by sub-section (1) to be registered shall make an application in this behalf in the prescribed manner to the prescribed authority.

 

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

Provided that the special certificate shall not specify the class or classes of goods for the purposes of sub-clause (ii) of clause (a) of sub-section (2) of section 5.

(4)     The Commissioner may from time to time amend any special certificate in accordance with the information furnished under section 16 or otherwise received by him.

 

(5)     The provisions of sub-section (3) of section 4, sub-section (5) and sub-section (6) of section 7 shall apply to registration under this section.]

Section 9 - List of registered dealers to be published

The Commissioner shall, as soon as may be after the commencement of this Act publish in the Official Gazette a list of the names and addresses of the registered dealers together with a description of the goods covered by the certificate of the registration, and thereafter shall in like manner from time to time publish-

(a)      such particulars of any dealer who is subsequently registered or whose registration certificate is amended or whose registration is cancelled as soon as may be after such registration or cancellation, and

 

(b)      a consolidated list embodying the modification made in first list published under this section.

Section 10 - Payment of tax and returns

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

 

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

 

(3)     Before any registered dealer furnishes the returns required by sub-section (2), he shall, [30] [pay into a Government treasury or the Reserve 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 returns, and shall furnish along with the returns a receipt from such Treasury or Bank showing the payment of such amount.

 

(4)     If any dealer discovers any omission or other error in any return furnished by him, he may at any time before the date prescribed for the furnishing of the next return by him furnish a revised return; and if the revised return shows a greater amount of tax to be due than was shown in the original return, it shall be accompanied by a receipt showing payment in the manner provided in sub-section (3) of the extra amount.

Section 10A - Collection of tax only by registered dealers

[31] [No person who is not a registered dealer shall collect in respect of any sale by him of goods in the Union territory of 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.]

Section 11 - Assessment of tax

(1)     If no returns are furnished by a registered dealer in respect of any period by the prescribed date, or if the Commissioner is not satisfied that the returns furnished are correct and complete, the Commissioner shall, within eighteen months after the expiry of such period, proceed in such manner as may be prescribed to assess to the best of his judgment the amount of the tax due from the dealer and in making such assessment shall give the dealer a reasonable opportunity of being heard; and in the case of failure by a registered dealer to submit in respect of any period, a return accompanied by receipt from a Government Treasury or Reserve Bank of India as required under sub-section (3) of section 10, by the prescribed date, the Commissioner may, if he is satisfied that the 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.

 

(2)     If upon information which has come into his possession, the Commissioner is satisfied that any dealer,1[who has been liable to pay the tax under this Act in respect of any period but has failed to get himself registered the Commissioner shall] proceed in such manner as may be 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 the default was made without reasonable cause, direct that the dealer shall pay by way of penalty in addition to the amount of tax so assessed a sum not exceeding one and a half times that amount.

 

(3)     No assessment under sub-section (1) shall be made after the expiry of four years and no assessment under sub-section (2) shall be made after the expiry of six years from the end of the year in respect of which or part of which the assessment is made:

[32] [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 six years, as the case may be, shall be reckoned from the date of such order];

(4)     The amount of tax-

 

(a)      due where the returns are furnished without, receipt showing full payment thereof, or

 

(b)      assessed under sub-section (1), less the sum, if any, already paid by the dealer in respect of the said period, or

 

(c)      assessed under sub-section (2),

shall, together with any penalty that may be directed, to be paid under any of the provisions of this section[33] [or section 22A], be paid by the dealer into a Government Treasury or the Reserve Bank of India [34] [or in such other manner as may be prescribed] by such date as may be specified in a notice issued by the Commissioner for this purpose and the date to be so specified shall be not less than thirty days from the date of service of such notice:

Provided that the Commissioner may, in respect of any particular dealer and for reasons to be recorded in writing extend the date of such payment or allow such dealer to pay the tax due and the penalty if any by installments.

[35] [(3a) When a dealer is in default in making a payment of the tax, the Commissioner or any person appointed to assist him under sub-section (1) of section 3, may in his discretion direct that, in addition to the amount of the arrears, a sum not exceeding that amount shall be recovered from the dealer by way of penalty.]

(5)     Any amount of tax or penalty which remains unpaid after the date specified in the said notice shall be recoverable as an arrear of land revenue.

 

(6)     Any assessment made under this section shall be without prejudice to any prosecution instituted for an offence against this Act.

Section 11A - Assessment and reassessment of tax

[36] [If in consequence of definite information which has come into his possession the Commissioner is satisfied that the turnover of the business of a dealer has escaped assessment or has been under-assessed in any year, the Commissioner may, at any time within the period of three years following the close of the year for which the turnover is proposed to be assessed or re-assessed, as the case may be, send a notice to the dealer, and after hearing him and making such inquiry as he considers necessary may proceed to assess or re-assess, as the case may be, the tax payable on the turnover which has escaped assessment or has been under-assessed, and all the provisions of this Act, and the rules made thereunder shall, so far as may be, apply accordingly for the purpose of the assessment or re-assessment of the tax, as the case may be.]

Section 12 - Refunds

(1)     The Commissioner shall, in the prescribed manner, refund to a dealer applying in this behalf any amount of tax or penalty paid by such dealer in excess of the amount due from him under this Act, either by cash payment or, at the option of the dealer, by deduction of such excess from the amount of tax due in respect of other period:

Provided that no refund shall be made unless the claim for refund is made within twelve months from the date of the assessment of tax or the date of the imposition of penalty or within six months from the date of any final order passed on appeal, revision or review under section 20 or reference under section 21, whichever period expires later.

(2)     Nothing in sub-section (1) shall be deemed to empower the Commissioner to amend, vary or rescind any assessment or to amend, vary or rescind any order passed on appeal, revision or review under section 20 or reference under section 21, or to confer on a dealer any relief in addition to what he is entitled under the provisions of this Act.

Section 13 - Accounts

Every registered dealer or other dealer on whom a notice has been served to furnish returns under sub-section (2) of section 10, 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 prescribed.

Section 14 - 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-

 

(a)      to produce before him any accounts, registers or documents,

 

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

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

(2)     (a) All accounts, registers and documents relating to the stocks of goods of, or purchases, skies and deliveries of goods by, any dealer; and

(b) all goods kept in any place of business of any dealer shall at all reasonable times be open to inspection by the Commissioner.

(3)     If the Commissioner has reason to suspect that any dealer is attempting to evade payment of any tax under this Act, he may, for reasons to be recorded in writing, seize such accounts, registers or documents of the dealer as may be necessary, and shall grant a receipt for the same, and shall retain the same only for so long as may be necessary for examination thereof or for a prosecution.

(4)     For the purposes of sub-section (2) or subsection (3) the Commissioner may enter and search any place of business of any dealer.

or

any other place where the Commissioner has, upon information received, reason to believe that the dealer keeps or is for the time being keeping any accounts, registers or documents of his business.

Section 15 - Delegation of Commissioner's powers

 Subject to such restrictions and conditions as may be prescribed, the Commissioner may by order in writing delegate any of his powers under this Act except those under, sub-section (2) of section 22 to any person appointed under section 3 to assist him.

Section 16 - Information to be furnished regarding changes of business

If any dealer to whom the provisions of subsection (2) of section 10 apply,-

(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 business or opens a new place of business; or

 

(c)      changes the name or nature of his business or effects any change in the class or classes of goods in which he carries on his business and which is or are specified in his certificate of registration;

[37] [he shall within the prescribed time inform the prescribed authority accordingly; and if any such dealer dies, his legal representative shall in like manner inform the said authority.]

Section 17 - Transfer of Business

Where the ownership of the business of a registered dealer is entirely transferred and the transferee carries on such business either in its old name or in some other name, the transferee shall for all the purposes of this Act (except for liabilities under this Act already discharged by such dealer) be deemed to be and to have always been registered as if the certificate of registration of such dealer had initially been granted to the transferee; and the transferee shall on application to the Commissioner be entitled to have the registration certificate amended accordingly.

Section 19 - Bar to certain proceedings

Save as is provided in section 21, no assessment made and no order passed under this Act or the rules made thereunder by the Commissioner or any person appointed under section 3 to assist him shall be called into question in any Civil Court, and save as is provided in section 20, no appeal or application for revision or review shall lie against any such assessment or order.

Section 20 - Appeal, revision and review

(1)     Any dealer may in the prescribed manner appeal to the prescribed authority against any assessment within sixty days or such further, period as may be allowed by the Commissioner for cause shown to his satisfaction from the receipt of a notice issued under sub-section (3) of section 11 in respect thereof:

Provided that no appeal shall be entertained by the said authority unless he is satisfied that such amount of the tax as the appellant may admit to be due from him has been paid.

(2)     Subject to such rules of procedure as may be prescribed by the appellate authority, in disposing of any appeal under sub-section (1), may-

(a) confirm, reduce, enhance or annual the assessment, or;

(b) set aside the assessment and direct the assessing authority to make a fresh assessment after such further inquiry as may be directed.

(3)     Subject to such rules as may be prescribed and for reasons to be recorded in writing, the Commissioner upon application or of his own motion may revise any assessment made or order passed under this Act or the rules thereunder, by a person appointed under section 3 to assist him, and subject as aforesaid, the Chief Commissioner may, in like manner, revise any order passed by the Commissioner:

Provided that before rejecting any application for the revision of any such order the Commissioner or the Chief Commissioner, as the case may be, shall consider it and shall record reasons for such rejection:

Provided further that no application for revision shall lie to the Commissioner in respect of any assessment if an appeal lies under sub-section (1) to the Commissioner in respect of such assessment.

(4)     Subject to such rules as may be prescribed, any assessment made or order passed under this Act or the rules made thereunder by any person appointed under section 3 may be reviewed by the person passing it upon application or of his own motion.

(5)     Before any order is passed under this section which is likely to affect any person adversely, such person shall be given reasonable opportunity of being heard.

Explanation.-In this section "assessment" includes imposition of penalty.

Section 21 - Statement of case to High Court

(1)     Within sixty days from the passing by the Chief Commissioner of any order under sub-section (3) of section 20 affecting any liability of any dealer to pay tax under this Act, [38] [such dealer or the Commissioner may, by application in writing, and accompanied in the case of an application by a dealer by a fee of one hundred rupees], require the Chief Commissioner to refer to the High Court any question of law arising out of such order.

 

(2)     If, for reasons to be recorded in writing, the Chief Commissioner refuses to make such reference, the applicant may, within thirty days of such refusal, either-

 

(a)      withdraw his application (and if he does so, the fee paid shall be refunded), or

 

(b)      apply to the High Court against such refusal.

 

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

 

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

 

(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 Chief Commissioner a copy of such judgment under the seal of the Court and the signature of the Registrar, and the Chief Commissioner shall dispose of the case accordingly.

 

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

 

(7)     The payment of the amount, if any, of tax due in accordance with the order of the Chief Commissioner 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 the result of such reference, the excess tax paid shall be refunded in accordance with the provisions of section 12.

Section 21A - Power of Commissioner to take evidence on oath, etc

(1)     The Commissioner or any person appointed to assist him under sub-section (1) of section 3 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;

(b) compelling the production of documents; and

(c) issuing commissions for the examination of witnesses;

and any proceeding under this Act before the Commissioner or any person appointed to assist him under sub-section (1) of section 3 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.

[39] [(2) 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 to assist the Commissioner under sub-section (1) of section 3 shall not-

(a) impound any books of account or other document without recording his reasons for so doing; or

(b) retain in his custody any such books or document for a period exceeding thirty days without obtaining the approval of the Commissioner therefor.]

Section 22 - Offences and Penalties

(1)     Whoever-

 

(a)      carries on business as a dealer in contravention of sub-section (1) of section 7; or

 

(b)      fails, without sufficient cause, to submit any return as required by sub-section (2) of section 10 or submits a false return: or

 

(c)      being a registered dealer, falsely represents when purchasing any class of goods, that goods of such class are covered by his certificate of registration; or

 

(d)      not being a registered dealer, falsely represents when purchasing goods that he is a registered dealer; or

[40] [(dd) contravenes the provisions of section 10A; or]

(e)      fails, when required so to do under section 13, to keep prescribed accounts or records of sales; or

 

(f)       refuses to comply with any requirement made of him under sub-section (1) of section 14; or

 

(g)      knowingly produces incorrect accounts, registers or documents, or knowingly furnishes incorrect information; or

 

(h)     obstructs any officer making an inspection or a search or a seizure under section 14; or

 

(i)       neglects to furnish any information required by section 16; 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:

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 section 11 [41] [or section 22A].

(2)     No Court shall take cognizance of any offence under this Act, or under the 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.

(3)     All offences punishable under this Act shall be cognizable and bailable.

Section 22A - Penalty for concealment of sales or furnishing inaccurate particulars or making false representations

[42] [(1) If the Commissioner or any person appointed under sub-section (1) of section 3 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, in addition to the tax payable by him under this Act, pay, by way of penalty, 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.

(2) ???If any person purchasing goods is guilty of an offence under clause (c) or clause (d) of sub-section (1) of section 22, the authority which granted to him or as the case may be, is competent to grant to him a certificate of registration under this Act may, after giving him a reasonable opportunity 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.]

Section 23 - Compounding of offences

(1)     Subject to such conditions as may be prescribed, the Commissioner may accept, from any person alleged to have committed an offence under sub-section (1) of section 22 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 clause (a) or clause (b) of that sub-section, not exceeding double the amount of the tax which would have been payable by such person had he complied with the provisions of the Act, whichever is greater.

 

(2)     On payment in full of such sum as may be determined by the Commissioner under sub-section (1)-

 

(a)      no proceedings shall be commenced against such person as aforesaid; and

 

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

Section 23A - Setting up of check-posts and Barriers

[43] [(1) The Chief Commissioner may, by notification in the Official Gazette, set up check-posts or barriers at any place in the Union territory of Delhi with a view to preventing evasion of sales tax and other dues payable under this Act.

(2) ???Every person transporting such goods as may be notified shall, at any check-post or barrier referred to in sub-section (1), file before such officer as may be authorised by the Chief Commissioner in this behalf a declaration in such form and in such manner as may be prescribed.

(3) ??The officer authorised by the Chief Commissioner under sub-section (2) or any other officer who may be authorised in this behalf may, for the purpose of satisfying himself that the provisions of sub-section (2) are not being contravened, and subject to such restrictions as may be prescribed, intercept and search any vehicle which may be suspected of contravening the said provisions.]

Section 24 - Indemnity

No suit, prosecution or other legal proceedings shall lie against any servant of the Government for anything which is in good faith done or intended to be done under this Act or the rules made thereunder.

Section 25 - Returns etc. to be confidential

(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 Criminal Court, shall, save as provided in sub-section (3), be treated as confidential, and notwithstanding anything contained in the Indian Evidence Act, 1872 (1 of 1872), no Court shall, save as aforesaid, be entitled to 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.

 

(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:-

(a) ??of any of the particulars referred to in subsection (1) for the purposes of a prosecution under the Indian Penal Code, 1860 (XLV of 1860), in respect of any such statement, return, accounts, document or evidence, or for the purposes of a prosecution under this Act; or

[44] [(b) of such facts, to an officer of the Central Government or any State Government, as 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.]

Section 26 - Power to make rules

(1)     The Chief Commissioner may, subject to the condition of previous publication, 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 prescribe:-

(a) [45] [Omitted.]

(aa)[46] [Omitted.]

(b) ??the further period after the date of expiry of three consecutive years referred to in subsection (3) of section 4.

(bb) ?the particulars to be contained in a declaration under sub-clause (ii) of clause (a) of sub-section (2) of section 5, the form of such declaration, the authority from which such form shall be obtainable and the manner in which such declaration is to be furnished;

(c) [47] [Omitted.]

(d) ??the other sales turnover in respect of which may be deducted from a dealer's gross turnover in computing his taxable turnover as denned in section 5;

(e) ??the authority to which applications for registration under section 7 or section 8 shall be made;

(f) ???the procedure for, and other matters incidental to, the registration of dealers and the granting of certificates of registration, and the form of such certificates under section 7 or section 8;

(g)?? the intervals at which, and the manner in which, the tax under this Act shall be payable under section 10;

(h) ??the returns to be furnished under sub-section (2) of section 10; and dates by which, and the authority to which such returns shall be furnished;

(i) ???the date by which returns for any period are to be furnished and the procedure to be followed for assessment under section 11;

(j) ???the manner in which refunds under section 12 shall be made;

(k) ??the accounts and forms thereof required by section 13;

(l) ???the conditions under which the production of accounts or documents or the furnishing of information may be required under sub-section (1) of section 14;

(m) ?the restrictions and conditions subject to which the Commissioner may delegate his powers under section 15;

(n) ??the authority to which information shall be furnished under section 16;

(o) ??the manner in which, and the authority to which, appeals against assessment may be preferred under section 20;

(p) ??the procedure for, and other matters (including fees) incidental to, the disposal of appeals and applications for revisions and reviews under section 20;

(q) ??the conditions under which offences may be compounded under section 23;

(r) ??the manner in which, and the time within which, applications shall be made, information furnished and notices served, under this Act:

(s) [48] [Omitted.]

(t) ??any other matter required to be prescribed.

(3)     In making any rule the Chief Commissioner may direct that a breach thereof shall be punishable with fine not exceeding five hundred rupees, and when the offence is a continuing one, with a daily fine not exceeding twenty-five rupees during the continuance of the offence.

[49] [(4) All rules made under this section shall be laid for not less than thirty days before each House of Parliament as soon as may be after they are made and shall be subject to such modifications as Parliament may make during the session in which they are so laid or the session immediately following.]

Section 27 - Savings

[50] [Nothing in this Act or the rules made thereunder shall be deemed to impose, or authorise the imposition of a tax on any sale or purchase of any goods when such sale or purchase takes place-

(i)            in the course of inter-State trade or commerce;

 

(ii)          outside the Union territory of Delhi; or

 

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

Explanation.-Sections 3, 4 and 5 of the Central Sales Tax Act, 1956 (4 of 1956), shall apply for determining whether or not a particular sale or purchase takes place in the manner indicated in clause (i), clause (ii) or clause (iii).]

Schedule 1 - THE FIRST SCHEDULE

THE FIRST SCHEDULE

[See Section 5(i)(a)]

[51] [1. Motor Vehicles, including chassis of motor vehicles, motor tyres and tubes and spare parts of motor vehicles.

2. ??Motor cycles and cycle combinations, motor scooter, motorettes and tyres, tubes and spare parts of motor cycles, motor scooters, motorettes.

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

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 required for use therewith.

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 ammunitions 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.]

Schedule 2 - THE SECOND SCHEDULE

[52]THE SECOND SCHEDULE

(See Section 6.)

Exempted goods

1. ?All cereals and pulses including all forms of rice (except when sold in sealed containers).

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

3. ?Bread.

4. ?Meat (except when sold in sealed containers).

5. ?Fish (except when sold in sealed containers).

6. ?Fresh eggs.

6-a. Livestock including poultry.

7. ?Vegetables, green or dried and vegetable seeds and plants (other than medical preparations) (except when sold in sealed containers).

8. [53] [Fresh Fruits.]

9. [54] [Sugar, and molasses.]

10. Salt.

11 [55]* * * * *

12. Fresh milk, whole or separated and milk products.

13. Karadi (Safflower) oil and til (sesamum) oil.

14. [56] * * * * *

15. [57] [Edible oils pressed on Ghanies.]

16. Ghee.

16-a. Dahi, butter and khoa.

17. [58] [All varieties of cotton, woollen, rayon or artificial silk fabrics, but not including real silk fabrics.]

18. [59] * * * * *

19. [60] * * * * *

20. [61] * * * * *

21. [62] [Cotton yarn including cotton thread.]

21a. [63] * * * * *

22. [64] * * * * *

23. [65] [white printing paper, cream laid paper, hand made paper and news print.]

24. School exercise and drawing books.

25. All books.

26. Kerosene.

27. [66] [* * * * *]

28. [67] [Fuel, wood and charcoal].

29. [68] [Agricultural implements].

30. [69] * * * * *

31. [70] * * * * *

32. Matches.

33. Cattle feeds including fodder.

34. Electrical energy.

35. [71] * * * * *

36. [72] [Hides and skins, whether in a raw or dressed state].

37. [73] * * * * *

38. [74] [Fertilisers].

39. [75] [Water but not aerated water or mineral water, or water sold in bottles or sealed containers.]

40. [76] * * * * *

41 [77]* * * * *

42. [78] * * * * *

43. [79] [Raw wool].

44. [80] * * * * *

45. [81] [Tobacco and all its products.]

46. [82]    [(i). Country-made shoes (Juties).

47.[83] [Achar and Murrabba except when sold in sealed containers.]

48. [84] [Charkha, takli and charkha accessories.]

49. Slate, slate pencils, takhties [85] [black ink used for takhties writing chalks, crayons, foot-rules of the type usually used in schools and kalams (pens used for takhties)].

50. [86] [Betal leaves].

51. [87] [Durries of the size not exceeding 30 sq. feet in area.]

52. [88] [Bardana including hessian cloth, iron strips and wooden and tin packing, the sale of which is incidental to dealings in any of the other goods mentioned in this Schedule.]

53. [89] [Cotton padding.]

54. [90] [All pure silk fabrics, manufactured in Mills, power looms or hand looms.]

Schedule 3 - THE THIRD SCHEDULE

[91]THE THIRD SCHEDULE

[See Section 5(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 denned in section 14 of the Central Sales Tax Act. 1956 (74 of 1956).

 

5.        Oil-seeds as defined in section 14 of the Central Sales Tax Act, 1956 (74 of 1956).