JHARKHAND VALUE ADDED TAX ACT, 2005

JHARKHAND VALUE ADDED TAX ACT, 2005

Preamble 1 - THE JHARKHAND VALUE ADDED TAX ACT, 2005

JHARKHAND VALUE ADDED TAX ACT, 2005

PREAMBLE

An Act to provide for and consolidate the law relating to levy of Value Added Tax on sales or purchases of goods and on Entry of Goods into a local Area in the State of Jharkhand

BE it enacted in the fifty-sixth Year of Republic of India as follows:

Section 1 - Short title, extent and commencement

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

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

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

(4)     Any Notification, Order, Declaration or Rule and any Appointment to an office may be issued or made under the Act at any time after passing thereof; but such Notification, Order, Declaration, Rule or Appointment issued or made, shall not take effect until the date appointed under sub-Section (3) for bringing into force the respective provision under which it is issued or made.

Section 2 - Definitions

In this Act unless the context otherwise requires:

(i)       "Accountant" for the purpose of this Act means ?

(a)      A Chartered Accountant within the meaning of the Chartered Accountant's Act, 1949 (38 of 1949);

(b)      A person, who by virtue of the provisions of sub-section (2) of Section 226 of the Companies Act, 1956 (1 of 1956), is entitled to be appointed to act as an auditor of companies registered; or

(c)      A Cost Accountant within the meaning of the Cost and Works Accountants Act, 1959 (23 of 1959); or

(d)      A person referred to in Section 619 of the Companies Act, 1956 (1 of 1956);

(e)      A person, who has passed the final examination of Institute of Companies Secretaries of India, New Delhi;

(f)       A person, who has passed any other examination in this behalf, notified by the Government.

(ii)      "Act" means the Jharkhand Value Added Tax Act, 2005;

(iii)     "Appointed day", in relation to any provision of this Act, means the date on which such provision comes into force;

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

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

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

(vii)   "Branded" means any goods sold under a name or Trade Mark registered or pending registration of transfer under the Trade and Merchandise Act 1958 (Central Act 43 of 1958) or the Trade Marks Act 1999 (Central Act 47 of 1999).

(viii)  "Business" includes -

(a) The provisions of any services, but excluding the services provided by an employee;

[1][(b) Any trade, commerce, e-commerce, e-commerce portal, manufacture or any adventure or concern in the nature of trade, commerce, e-commerce, e-commerce portal, manufacture, whether or not such trade, commerce, e-commerce, e-commerce portal, manufacture, adventure, concern is carried on with a motive to make gain or profit and whether or not any gain or profit accrues from such trade, commerce, e-commerce, e-commerce portal, manufacture, adventure, concern; and

(c) Any transaction in connection with, or incidental or ancillary to such trade or services, commerce, e-commerce, e-commerce portal, manufacture, adventure or concern; referred to in clause (a) and includes any transaction involving goods whether or not in their original form or in the form of second hand goods, unserviceable goods, obsolete or discarded goods, scrap or waste material goods, which are obtained as waste-product, by-product in course of manufacture or processing of other goods or mining or generation and distribution of electricity.]

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

(x)      "Capital goods" means plant, machinery, equipment, apparatus, tools, appliances or electrical installation, Pollution/Quality Control Equipments, used in the process of manufacturing, processing of goods for sale or in the mining, provided such purchases are capitalized for their purposes excluding goods mentioned in negative list as in Appendix - I;

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

(xii)   "Casual Trader" means a person who whether as principal, agent or in any other capacity, has occasional transactions involving buying, selling, supplying or distributing goods or conducting any exhibition cum Sale in the state, whether for cash or for deferred payment, or for commission, remuneration, or other valuable consideration;

(xiii)  "Dealer" means any person who carries on the business of buying, selling, supplying or distributing goods, executing works contract, delivering any goods on hire-purchase or any system of payment by installments; transferring the right to use any goods or supplying by way of or as part of any service, any goods directly [2][or through any system of Electronic commerce or otherwise] or otherwise, whether for cash or for deferred payment, or for commission, remuneration or other valuable consideration and includes;

(a)      a casual trader;

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

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

(d)      a person who, in the course of business, -

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

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

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

(xiv)  "Declared goods" means goods declared to be of special importance in inter-State trade or commerce under Section 14 of the Central Sales tax Act, 1956 (Central Act 74 of 1956);

(xv)   "Deputy Commissioner" means any person appointed to be a Deputy Commissioner of Commercial Taxes under this Act'.

(xvi)  "Documents" includes written or printed records of any sort, title deeds and data stored electronically in whatever forms or any other record or form as defined in the Information Technology Act 2000.

(xvii) "Documents of Title" means, any document which confers a title to goods and includes a bill of lading, dock warrant, warehouse-keeper's certificate, and warrant or order for the delivery of goods and any other document used in the ordinary course of business as proof of the possession or control of goods, or authorizing of purporting to authorize, either by endorsement or by delivery, the possessor of the document to transfer or to receive goods thereby represented;

[3][(xvii)A "E-commerce or Electronic commerce including-commerce, e-Business, on-line shopping or similar other variants or nomenclature" means buying, selling, supplying, distributing or delivering of goods and services or anything incidental to such buying, selling, supplying, distributing or delivering directly or indirectly and transmitting valuable consideration or making payment incidental thereto over an electronic Network or Website or by any other means.]

(xviii)   "Electronic Record" means, a data, record or data generated, image or sound stored, received or sent in an electronic form or micro film or computer generated micro fiche or in a computer disk or in a computer floppy or computer software/media;

(xix)  "Entry of goods" - "Entry of goods" with all its grammatical variations and cognate expressions means entry of goods mentioned in schedule III into a local Area from any place out side the state

(xx)   "EOU" - (Export Oriented Unit) means any industrial unit, which undertakes to export their entire production of goods and is approved as such by the Development Commissioner of the concerned Export Processing Zone or any other competent authority duly authorized for the purpose by the Ministry of Industry, Government of India.

(xxi)  "EHTP"- (Electronic Hardware Technology Park), is a unit set up under the EHTP, which undertakes to export their entries production of goods outside the territory of India and is approved by the Development Commissioner of the Export Processing Zone or any other competent authority duly authorized by the Ministry of Industry, Government of India for the purpose.

(xxii) "Goods" means all kinds of movable property (other than newspapers, actionable claims, electricity, stocks and shares and securities) and includes livestock, all materials, computer software sold in any form, Sim cards used in Mobile Telephony or for any other similar activation purposes, commodities and articles and every kind of property (whether as goods or in some other form) involved in the execution of a works contract, and all growing crops, grass, trees and things attached to, or forming part of the land which are agreed to be severed before sale or under the contract of sale;

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

(xxiv)   "Government" means Government of Jharkhand.

(xxv)"Gross Turnover" means-

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

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

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

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

(xxvii)  "Import Price" means the amount payable by a dealer or any person, as valuable consideration in respect of the sale or supply of goods making entry into the State or into the local area, but shall not include the tax paid or payable under Central Sales Tax Act or under any other State Taxes Act(s), in respect of such sales or purchases.

(xxviii) "Input" means, goods purchased in course of business - (a) for resale in the same form; or (b) for use in manufacturing or processing of taxable goods for sale; or (c) for directly use in mining or use as containers or packing materials for taxable goods; or (d) for the execution of works contract, but excluding purchases of Petrol, Diesel and Natural Gas and for use as Capital Goods as specified in Appendix-I of this Act.

(xxix)   "Input Tax" means the tax paid or payable under this Act, by a registered dealer to another registered dealer on the purchase of goods, [4][viz. purchases debited to profit and loss account] in the course of business for resale or for use in manufacturing or processing of taxable goods for sale, or for directly use in mining or use as containers or packing materials for taxable goods or for the execution of works contract;

Provided that input tax shall also include tax paid on the entry of goods into the local area as specified in Schedule-III.

Provided further that input tax shall also include tax paid on the capital goods for Registered Start-up-business and shall qualify for Input Tax Credit as prescribed.

[5][Provided further, that tax charged at Maximum Retail Price; shall not be treated as Input Tax, for the purpose of resellers, when reselling medicines or drugs, specified in the Drugs (Prices Control) Order 1995.]

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

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

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

(xxxiii) "Maximum Retail Price", in respect of goods taxable under this Act, means maximum price printed on the package of any goods at which such goods may be sold to the ultimate consumer, whether such price is inclusive of tax or not;

(xxxiv) "Month" means a calendar month;

(xxxv)  "Notification" means a notification published in the official Gazette of the Government.

(xxxvi) "Non Resident Dealer" means a dealer, who effects sales or purchases of any goods in the State, but who has no fixed place of business or residence in the State;

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

(xxxviii)              "Person" includes:-

(xxxix) "Place of Business" means any place where a dealer carries on the business and includes :-

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

(b)      any place where a dealer produces or manufactures goods;

(c)      any place where a dealer keeps his books of accounts;

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

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

(xl)    "Prescribed Authority" and "Prescribed" means prescribed by Rules made under this Act;

(xli)   "Principal Officer", in relation to a company, means the director or Managing Director of such company, or the secretary, or any such person of the Company specially authorized to act as Principal Officer by the Board of Directors or by such Director or the Managing Director of such company, authorized in this behalf.

(xlii)  "Purchase price" means the amount of valuable consideration paid or payable by a person for any purchase made including any sum charged for anything done by the seller in respect of the goods at the time of or before delivery thereof, other than the cost of insurance for transit or of installation, when such cost is separately charged, and shall not include tax paid or payable under this Act, by a person in respect of such purchase.

Explanation I - The amount of duties levied or leviable on the goods under the Central Excise Act, 1944 (1 of 1944), or the Customs Act, 1962 (52 of 1962) or the Bombay Prohibition Act, 1949 (Bom. XXV of 1949) shall be deemed to be part of the purchase price of such goods, whether such duties are paid or payable by or on behalf of the seller or the purchaser or any other person.

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

Explanation III - 'purchase price' shall not include -

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

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

(xliii) "Quarter" means the quarter ending on the 30th June, 30th September, 31st December and 31st March:

(xliv) "Resale" means a sale of goods in the State of Jharkhand or in the course of inter-State trade and commerce and export out of the territory of India;

(a)      in the same form in which they are purchased, or

(b)      Without doing anything to them, which amounts to, or results in, a Manufacture.

and the term "re-sell" shall be construed accordingly;

(xlv)  "Registered dealer" means a dealer registered under this Act;

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

(xlvii)   "Sale" with all its grammatical variations and cognate expressions means any transfer of property in goods for cash or deferred payment or other valuable consideration but does not include a mortgage or hypothecation of or a charge or pledge on goods, and the words "sell", "buy" and "purchase", with all their grammatical variations and cognate expressions, shall be construed accordingly and includes-

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

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

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

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

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

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

(g)      a sale within the State includes a sale determined to be inside the State in accordance with the principles formulated in Section 4 of the Central Sales Tax Act, 1956;

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

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

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

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

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

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

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

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

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

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

(xlviii)  "Sale Price" means the amount payable to a dealer as valuable consideration in respect of the sale or supply of goods, and shall not include tax paid or payable under this Act, by a person in respect of such sales.

Explanation I - The amount of duties or fees or any sum levied or leviable or charged on the goods under the Central Excise Act, 1944 (I of 1944), or the Customs Act 1962 (52 of 1962) or the State Excise Act or any law shall be deemed to be part of the sale price of such goods, whether such sum are paid or payable by or on behalf of the seller or the purchaser or any other person.

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

Explanation III - Sale price shall not include the cash discount, if shown separately; and allowed by the dealer in the ordinary course of trade practice, provided the same is allowed to a registered VAT dealer. It shall also not include the cost for transport of the goods from the seller to the buyer, provided such cost is separately charged to the buyer.

[6][Explanation IV-For the purpose of this clause, the expression "sale price" shall mean, the maximum retail price, as referred to in clause (xxxiii) of Section 2 of this Act, for a dealer, selling goods, specified in Drugs (Prices Control) Order 1995, to any other dealer.]

(xlix) "Schedule" means the schedule appended to this Act;

(l)       "SEZ" - means Special Economic Zone, as defined in the Central Excise Act 1944.

(li)      "State" means the State of Jharkhand

(lii)     "Start up business" means a dealers' intention to set up a factory to manufacture any taxable goods shall be deemed/ treated as a "start up business" until the date of commencement of commercial production.

(liii)   "STP"- (Software Technology Park), unit means a unit set up under the STP, which undertakes to export their entire production of goods outside the territory of India and is approved by the Development Commissioner of the concerned Export Processing Zone or any other competent authority duly authorized by Ministry of Industry, Government of India for the purpose.

(liv)   "Tax" means the tax payable under this Act;

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

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

(lvii)  "Transporter", "Carrier" or "Transporting Agent" means any person, including the driver of the vehicle, who for the purposes of or in connection with or incidental to or in the course of his business transports or causes to transport goods, or holds goods in custody for delivery to any person after transportation, and includes railway, shipping company, air cargo terminal and courier service;

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

Explanation-

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

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

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

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

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

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

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

(lx)    "Value Added Tax" means a tax on sales or purchases levied under this Act;

(lxi)   "Vehicle" includes every wheeled conveyance used for the carriage of goods solely or in addition to passengers.

(lxii)  "Vessel" includes any ship, barge, boat, raft, timber, bamboos or floating materials propelled in any manner-

(lxiii) [7]["Works contract" means a contract for carrying out any work and includes any contract or agreement for carrying out for cash or deferred payment or other valuable consideration for assembling, construction, building, altering, manufacturing, processing, fabrication, erection, installation, modification, fitting out, improvement, repair or commissioning of any building, road , bridge or any other immovable or movable property.]

(lxiv) "Year" means the financial year beginning from 1st April and ending with 31st March;

(lxv)  "Zero Rated Sales" for the purpose of this Act means a sale of goods, in the course of Inter-State Trade or Commerce, export to outside the territory of India including sale in course of Export and Sale of Goods to any unit located in Special Economic Zone as may be notified.

Provided further, unless otherwise specified in this Act-

(a)      words importing the masculine gender shall include the feminine gender;

(b)      words in singular shall include their plural and vice versa;

(c)      expressions referring to "writing" shall include printing, typing, lithography, photography and other methods of representing or reproducing words in a visible form; and

(d)      with reference to a person who is unable to sign his name, the word "signature" shall include his thumb impression or other mark duly attested to signify his signature.

Section 3 - Tribunal

Subject to such rules as may be prescribed, the State Government shall, by notification published in the Official Gazette, constitute a Tribunal consisting of one or more members to exercise all the powers and perform all the functions conferred by or under this Act or any other law for the time being in force.

Section 4 - Taxing Authorities

(1)     There shall be the following classes of authorities to be appointed by the State Government, for carrying out the purposes of this Act, namely :-

(a)      Commissioner of Commercial Taxes;

(b)      Additional Commissioner of Commercial Taxes;

(c)      Joint Commissioner of Commercial Taxes:

(d)      Deputy Commissioner of Commercial Taxes:

(e)      Assistant Commissioner of Commercial Taxes:

(f)       Commercial Taxes Officer.

(2)     The authorities appointed under sub-Section (1) shall, within such areas (or in respect of such transaction falling within an area) as the State Government may by notification specify, exercise such powers as may be conferred and perform such duties as may be imposed, by or under this Act.

(3)     The Commissioner may, at any stage, direct transfer of a proceeding under this Act in respect of any dealer from the prescribed authority to another authority of the same or higher rank appointed under sub-Section (1). Where such direction is given by the Commissioner the authority to whom the proceeding is transferred shall proceed to dispose it of as if it had been initiated by the said authority, irrespective of the local limits of its jurisdiction; such transfer shall not render necessary the re-issue of any notice already issued before the transfer and the authority to whom the proceeding is transferred may, in its discretion, continue it from the stage at which it was left by the authority from whom it was transferred.

(4)     For smooth functioning of the office, it shall be lawful for the Deputy Commissioner or the Assistant Commissioner in-charge of a circle or the Commercial Taxes Officer in-charge of a circle or sub-circle, to allot work and proceedings amongst the officers posted in circle or sub-circle, as the case may be and it may include transfer of a proceeding from one officer to another posted in the same office and exercising concurrent jurisdiction.

[8][(5) For smooth functioning of the office, it shall be lawful for the Joint Commissioner, VAT Audit to allot work and proceedings amongst the officers posted in VAT audit division as the case may be and it may include transfer of a proceeding from one officer to another officer posted in the same office and exercising concurrent jurisdiction.]

Section 5 - Powers of Tribunal and Taxing Authorities to take Evidence on Oath, etc.

(1)     The Tribunal, or any authority appointed under sub-Section (1) of Section 4 shall for the purposes of this Act have the same powers as are vested in a court under the Code of Civil Procedure, 1908 (V of 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 books of accounts and other documents; and

(c)      issuing commissions for the examination of witness.

(2)     Any proceeding under this Act before the Tribunal, or any authority appointed under sub-Section (1) of Section 4 shall be deemed to be a "judicial proceeding" within the meaning of Section 193 and 228 and for the purposes of Section 196 of the Indian Penal Code, 1860 (XLV of 1860).

Section 6 - Members of the Tribunal and Taxing Authorities to be Public Servant

Members of the Tribunal appointed under Section 3 and all the taxing authorities appointed under Section 4 of this Act shall be deemed to be public servants within the meaning of Section 21 of Indian Penal Code.

Section 7 - Indemnity

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

Section 8 - Incidence of Tax

(1)     Every dealer ?

(a)      whose gross turnover of sales or purchases during the year immediately preceding the commencement of this Act,-

(i)       exceeded the specified quantum, or

(ii)      who is registered or liable to be registered under the adopted Bihar Finance Act, 1981 or the Central Sales Tax Act, 1956, or

(b)      to whom clause(a) does not apply, and

(i)       whose gross turnover first exceeds the specified quantum during any period of twelve consecutive months, or

(ii)      who has become liable to pay tax under the Central Sales tax Act, 1956, or

(iii)     who is registered as a dealer under the Central Sales tax Act, 1956 or under this Act at any time after the commencement of this Act;

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

(2)     Every dealer is liable to pay tax under sub-Section (1) on purchases and sales effected by him,

(a)      in case of clause (a) of sub-Section (1), with effect from the date of commencement of this Act;

(b)      in case of sub-clause (i) of clause (b) of sub-Section (1), with effect from the date immediately following the day on which his gross turnover first exceeded the specified quantum during a period of any twelve consecutive months.

(c)      In case of sub-clauses (ii) and (iii) of clause (b) of sub-Section (1), with effect from the date of registration or the date on which he becomes so liable whichever is earlier.

(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 specified quantum and his liability to pay tax under this Act shall cease on the expiry of the period specified above.

(4)     Every dealer who has ceased to be liable under sub-Section (3) shall be again liable to pay tax under this Act with effect from the date immediately following a period not exceeding twelve consecutive months during which his gross turnover again exceeds the specified quantum.

(5)     For the purpose of this Act, specified quantum means in relation to any dealer who:

(a)      imports for sale any goods into the State of Jharkhand on his own behalf or on behalf of his principal Nil

(b)      manufactures or produces any goods for sale Rs. 50,000

(c)      is engaged in any other business other than clause (a) and (b) Rs. 5 lakh

(d)      involved in the execution of works contract and leasing Rs. 25 thousand

Provided that the State Government may, by notification published in the Official Gazette and subject to condition of one month's previous notice, increase or reduce the amount of specified quantum.

[9][(e) is engaged in any other sales or purchases or class of sales or purchases: other than (a), (b) and (c); the specified quantum shall be, as specified in this behalf, from-to-time.]

(6)     For the purpose of calculating the gross turnover to determine the liability to pay tax under the Act-

(a)      except as otherwise expressly provided, the turnover of all sales or as the case may be, the turnover of all purchases shall be taken, whether such sales or purchases are taxable or not, and

(b)      the turnover shall include all sales [10][or] purchases made by a dealer on his own account and also on behalf of principals whether disclosed or not.

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

Section 9 - Levy of Tax on Sale and Determination of Taxable Turnover

(1)     Subject to the provisions as contained in Section 11 and sub-Section (2) of this Section, the tax payable by a dealer liable to pay tax under Section 8, shall be levied at every stage or stages of sales on sale price(s) of goods.

[11][***]

[12][(2) Notwithstanding anything contained in this Section, any registered dealer, who imports into or manufactures Medicines and Drugs; as specified in the Sl. No. 85 of the Part B of Schedule II, excluding Bulk Drugs and Non Drugs (Prices Control) Order 1995 Medicines, such as Ayurvedic, Siddha, Unani or Homeopathic medicines, appended to the Act; in Jharkhand, may, at his option, pay, tax at the full rate on the Maximum Retail Price of such goods, in lieu of tax payable by him under Sub-section(1) of Section 9 of the Act.

Provided that where a dealer has purchased such goods -

(a)      from an importer or a manufacturer upon payment of tax an the maximum retail price of such goods; or

(b)      from another registered dealer, where tax on the maximum retail price of such goods was paid in Jharkhand at an earlier stage,the purchasing dealer, while making resale of such goods in Jharkhand, shall, notwithstanding anything contained elsewhere in the Act, be entitled to recover from the buyer, the amount of tax paid by him at the time of purchase of such goods, under such conditions and restrictions, and in such manner, as may be prescribed or notified in this behalf.

Provided further that the dealer making resale of such goods, shall not levy any tax payable under the Act, on such goods."

Provided further that if dealers opt to pay tax on maximum retail price; no input tax credit shall be admissible to the subsequent purchasing dealers.]

[13][(3)] The tax payable by a dealer liable to pay tax under Section 8, on sales of such goods as mentioned in part E of Schedule II of this Act, shall be levied on his taxable turnover of sales, at the first stage of sale in the state by a dealer, and subsequent sales of the same goods shall not be levied to tax, if the dealer making subsequent sales of such goods, produces before the Prescribed Authority such evidence(s), as may be prescribed.

[14][(4)] Taxable turnover of sales in relation to a dealer liable to pay tax on sale of goods under sub-Section (1) of Section 8 shall be part of the gross turnover of sales during any period which remains after deducting there from.

(a)      sales of goods declared as exempt from tax in schedule 'I'.

(b)      sales of goods which are shown to the satisfaction of the prescribed authority to have taken place ?

(i)       in the course of inter-State trade or commence, or

(ii)      outside the State of Jharkhand, or

(iii)     in the course of the 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 shall apply for determining whether or not a particular sale or purchase has taken place in the manner indicated in sub-clause (i) sub-clause (ii) or sub-clause (iii).

(c)      in case of turnover of sales in relation to works contract, the charges towards labour, services other like charges and subject to such conditions as may be prescribed :

Provided that in the cases where the amount of charges towards labour, services and other like charges in such contract are not ascertainable from the terms and conditions of the contract, the amount of such charges shall be calculated at the prescribed percentage.

(d)      such other sales on such conditions and restrictions as may be prescribed.

Section 10 - Levy of Tax on Purchases

Every dealer liable to pay tax who in the course of his business purchases any goods.

(i)       from a registered dealer or a dealer in the circumstances in which no tax under Section 9 is payable by that registered dealer or a dealer on the sale price of such goods, or ?

(ii)      from a person, shall be liable to-pay tax on the purchase price of such goods, if after such purchase, the goods are not sold within the State of Jharkhand or in the course of Inter-State trade and commerce or in the course of export out of the territory of India, but are ?

(a)      sold or disposed of otherwise, or

(b)      used or consumed in the manufacture of goods declared to be exempt from tax under this Act, or

(c)      after their use or consumption in the manufacture of goods, such manufactured goods are disposed of otherwise than by way of sale in the State or in the course of inter-State trade and commerce or export out of the territory of India; or

(d)      used or consumed otherwise, such tax shall be levied at the same rate at which tax under Section 9 would have been levied on the sale of such goods within the state on the date of such purchase.

Explanation -Sections 3, 4 and 5 of the Central Sales Tax Act, 1956 shall apply for determining whether or not a particular sale or purchase has taken place in the manner indicated in sub-clause 1(ii) and sub-clause 1(ii)(c).

Section 11 - Charge of Tax on Entry of Goods

(1)     Not withstanding any thing contained in Sections 9, 12, 13 and 14 of this Act or any notification issued there under, there shall be levied and collected a tax on Import price(s), on entry of such goods mentioned in schedule III of this Act, into the State or into a local Area for consumption, use or sale therein, subject to such condition as may be prescribed.

Provided that the tax levied on import price(s) of such goods mentioned in schedule III, shall be levied at the rate of 4 percentum.

Provided further that where a dealer has paid tax on entry of such goods, and on which he is not liable to pay Tax Under Section 17 of the Act, but is liable to pay tax by virtue of sale of such goods, under sub-Section (2) of Section 9, his liability to pay tax on such goods, as specified in Part-E of Schedule-II under Section 13, shall stand reduced to the extent of tax paid on the entry of such goods subject to such condition as may be prescribed.

(2)     The tax leviable under this Section shall be paid by every dealer or registered dealer or any other person who in course of his business or otherwise brings or causes to be brought into the local area, such goods mentioned in schedule III whether on his own account or on account of his principal or takes delivery or is entitled to take delivery of such goods on such entry.

Provided no tax shall be leviable in respect of entry of such goods effected by a person other than the dealer if the value of such goods does not exceed Rs. 10,000 (ten thousand) in a year.

(3)     The liability to pay tax under this Section, on goods mentioned is schedule III shall be only at the point of first entry into the State or into a local area and any subsequent sale or sales into the State or into any local area or areas of the said goods, shall not be subject to tax under this Section, provided the subsequent selling dealer or registered dealer produces before the prescribed authority, original copy of bill, invoice, cash memo or challan issued to him by the dealer from whom he purchased or received the said goods and files a true declaration in the Form and manner prescribed.

Section 12 - Levy of Tax on Containers and Packing Material

Where any goods packed in any container or packing materials are purchased, sold or brought into the local Area along with the container or packing materials in which such goods are packed, the tax under Section 9 or Section 10 or Section 11 on the purchases or sale or on the entry of such container or packing materials shall be levied at such rate of tax, if any, on the sale, purchase or entry as the case may be, of the goods themselves treating the containers, packing materials as goods integrated with the goods sold, purchased or brought, as the case may be, into the local Area.

Provided that no tax under Section 9 or Section 10 or Section 11 shall be levied where the container or packing material is sold or purchased along with the goods declared as exempt from tax under this Act.

Section 13 - Rate of Tax

(1)     The State Government may, in relation to goods mentioned in Part-E of Schedule-II, fix the tax payable on his taxable turnover, by a dealer under sub-Section (2) of Section 9, at a rate, not exceeding 50%, and subject to such conditions as the State Government may, from time-to-time specify.

(2)     The Rate of Tax in relation to goods mentioned in Part-A, Part-B, Part-C and Part-D of Schedule-II, shall be 1%, 4%, 4% and 12.5% respectively.

Section 14 - Exemptions

The sale of goods as specified in schedule-I shall be exempted from tax under this Act subject to conditions and exceptions set out therein.

Section 15 - Output Tax

(1)     Output tax in relation to a registered dealer means the tax payable under this Act in respect of any sale of goods by that dealer in the course of his business,

(2)     Subject to the provisions of Section 18, a dealer shall be liable to pay the output tax under this Act which shall be levied on the taxable turnover at the rates and subject to such conditions and restrictions as may be prescribed from time to time.

Section 16 - Input Tax

Input tax in relation to a registered dealer means the tax charged under this Act by the selling dealer to such dealer on the sale to him of any goods for resale or for use in manufacturing or processing of goods for sale or for directly use in mining or use as containers or packing materials or for the execution of works contract. It shall also include the tax paid on entry of goods as mentioned in schedule III by a registered dealer.

Section 17 - Tax Payable

(1)     The tax payable by a registered dealer for any tax period shall be the difference between the output tax payable plus purchase tax, if any, and the input tax paid, which can be determined, from the following formula:

Tax payable = (O+P)-I

Where 'O' denotes the output tax payable for any tax period as determined under Section 15, 'P' denotes the purchase tax paid by a registered dealer for any tax period as determined under Section 10 and 'I' denotes the input tax paid or payable and includes tax paid on Entry of Goods, for the said tax period as determined under Section 15.

(2)     The tax payable by a dealer liable to pay tax but not registered under this Act for a tax period shall be equal to the output tax payable for the said tax period as determined under Section 15.

(3)     If the amount calculated under sub-Section (1) is a negative quantum-

(a)      the same shall be adjusted against the tax liability, if any, under the Act as well as under the Central Sales Tax Act, 1956.

(b)      any amount of credit, remaining even after such adjustment shall be carried forward to the next tax period(s).

Section 18 - Input tax credit

[15][18. Input tax credit.--

(1)     Subject to the provisions of this Act, for the purpose of calculating the tax payable by a registered dealer for any tax period after being registered, an input tax credit as determined under this Section shall be allowed to such registered dealer for the tax paid or payable in respect of all taxable sales other than any other sales as may be prescribed, or purchases under Section 10 during that period,

(2)     The input tax credit to which the registered dealer is entitled shall be the amount of tax paid by the registered dealer to another registered dealer, on his turnover of purchases made during any tax period, intended to be used for the purposes and subject to the conditions as specified in sub Section (3), sub-Section (4), sub-Section (5) and sub-Section(6) and calculated in such manner as may be prescribed.

(3)     Subject to such conditions and restrictions as may be prescribed, partial or proportionate input tax credit may be allowed in such cases as may be used [16][***] for their respective uses.

(4)     Input Tax credit shall be allowed on purchase of goods made within the State of Jharkhand from a registered dealer holding a valid certificate of registration and which are intended for the purpose of-

(i)       sale or resale by him in the State of Jharkhand or

(ii)      sale in course of interstate trade and commerce or

[17][Provided that the input tax credit on such purchases when sold in course of inter-State trade and commerce shall be allowed only to the extent of Central Sales Tax payable on such sales made under sub-section (1) of Section 8 of the Central Sales Tax Act, 1956 and balance input tax shall not be available for adjustment from any tax, penalty or interest payable.]

[18][Provided that the Input Tax Credit on purchases when sold in course of inter-State trade or Commerce shall be allowed only to the extent of the Central Sales Tax payable under the Central Sales Tax Act, 1956 (74 of 1956)]

(iii)     use as raw material [19][***] for direct use in manufacturing or processing of goods for sale, or for directly use in mining, or for use as capital goods, other than those goods exempt from tax under this Act and the goods specified in Part E of schedule II, intended for sale in the State of Jharkhand or in the course of interstate trade and commerce [20][falling under sub-section (1) of Section 8 of the Central Sales Tax Act, 1956 (74 of 1956)]; or

[21][Provided that the input tax credit on such purchases when used for manufacturing or processing or mining of such goods sold in course of inter-State trade and commerce shall be allowed only to the extent of Central Sales Tax payable on sales of such finished or mined goods made under sub-section (1) of Section 8 of the Central Sales Tax Act, 1956 and balance input tax shall not be available for adjustment from any tax, penalty or interest payable.]

[22][Provided that the Input Tax Credit on purchases when sold in course of inter-State trade or Commerce shall be allowed only to the extent of the Central Sales Tax payable under the Central Sales Tax Act, 1956 (74 of 1956).]

(iv)    sale in the course of export out of the territory of India; or

(v)      for use as containers for packing of goods for sale or resale or for export out of the territory of India other than those exempted from tax under this Act and goods mentioned in Part E of Schedule II of this Act, for sale or resale in the State of Jharkhand or in the course of interstate trade and commerce.

Provided that if purchases are used partially for the purposes specified in this sub-Section, input tax credit shall be allowed proportionate to the extent they are used for the purposes specified in this sub-Section.

(vi)    sale by a dealer having business under a SEZ; or a STP; or a EHTP; or by an EOU.

(vii)   sale by dealers having business, located within SEZ to another unit located in SEZ.

(viii)  sale by dealers: inter-alia between whose units are referred to as, Export Oriented Units.

(ix)    sale by dealers, whose business is located within SEZ, to another unit as: "Export Oriented Unit".

(5)     Input Tax credit on capital goods other than those mentioned in Appendix I of this Act, shall be limited to plant, machinery and equipment directly connected with the manufacturing or processing of the finished products and directly for use in mining and input tax credit as admissible under this Section shall commence from the date of commencement of commercial production and shall be adjusted against tax payable on output, up to the period of three years;

Provided that in case of closure of business before the period specified above no further input tax credit shall be allowed and input tax credit carried forward, if any, shall be forfeited.

Provided further that input tax credit for "start up business" period shall be limited to the immediately last three preceding years, from the date of commencement of its commercial production.

(6)     Input Tax credit shall not be claimed by the dealer until the tax period in which the dealer receives the tax invoice in original containing the prescribed particulars of the sale evidencing the amount of input tax paid.

Provided that input tax credit shall be claimed by a registered dealer on the tax paid, on the entry of goods mentioned in schedule III evidencing the amount of tax paid, as prescribed.

Provided further that for good and sufficient reasons, to be recorded in writing, where a registered dealer is prevented from producing the Tax Invoice in original or evidence of payment of tax paid on entry of goods, in original, the prescribed authority may allow, such input tax credit as prescribed.

(7)     A registered dealer who intends to claim input tax credit under sub-Section (1) shall, for the purpose of determining the amount of input tax credit, maintain accounts, and such other records as may be prescribed in respect of the purchases, entry of scheduled goods into a local area and sales made by him in the State of Jharkhand.

(8)     No input tax credit under sub-Section (1) shall be claimed or be allowed to a registered dealer-

(i)       in respect of any taxable goods under this Act purchased by him from another registered dealer for resale but given away by way of free sample or gift;

(ii)      who has been permitted by the Commissioner to make payment of presumptive tax or under scheme of composition at a percentage of turn over of sales or otherwise in lieu of tax as provided under Section 22 and 58;

(iii)     in respect of capital goods, other than those directly used for manufacturing or processing of goods for sale or in mining;

(iv)    in respect of goods brought from outside the State against the tax paid in other States or otherwise;

(v)      in respect of stock of goods remaining unsold at the time of closure of business;

(vi)    in respect of goods purchased on payment of tax, if such goods are not sold because of any theft or otherwise;

(vii)   where the tax invoice is ?

(a)      not available with the dealer, or

(b)      there is an evidence that the same has not been issued by the selling dealer from whom the goods are purported to have been purchased;

(viii)  in respect of goods purchased from a dealer whose certificate of registration has been suspended;

[23][(ix) 'In respect of goods used as raw materials in manufacturing or processing of goods for inter-State transfer of stock or for sale outside the State'.]

[24][Provided that in respect of transactions falling under this clause, input tax credit may be allowed on the tax paid in excess of [25][5%] of the such materials used in the manufacture of the finished products.]

(x) in respect of sales exempted from tax as specified in Schedule I;

(xi) in respect of capital goods used for manufacturing or processing of goods for sale or directly for use in mining, where the finished products are dispatched other than by way of sales;

(xii) capital goods mentioned in negative list as in appendix I;

(xiii) goods mentioned in Part E of schedule II of the Act;

[26][(xv) On the purchase of goods sold as such or used in the manufacture of other goods and sold in course of inter-state trade or commerce falling under sub-section (2) of Section 8 of Central Sales Tax Act, 1956 (Central Act, 74 of 1956).]

[27][(xvi) Goods lost or damaged and not eventually sold.]

[28][(xvii) in case the amount of Input Tax Credit on any purchase of goods shall exceed the amount of tax in respect of the same goods actually paid, if any, under this Act into Government Treasury]

[29][(xviii) In respect of goods consumed or burnt up in course of manufacturing process and are not transferred into or existent in the finished product whether as goods or in any other form']

(9)     If goods purchased are intended for use specified under sub-Section (4) or loss of goods arising out of theft or destruction for any reason or the Stock of goods remaining unsold at the time of closure of business and are subsequently used, fully or partly, for purposes other than those specified under the said sub-Section, the Input Tax Credit already availed, at the time of such purchase shall be proportionately deducted from the Input Tax Credit, for the period during which the said utilization has taken place:

Provided that if part of the goods purchased are utilised otherwise or lost or remain unsold, the amount of reverse tax credit shall be proportionately calculated in a manner, prescribed.

(10)   The methods that are used by a registered dealer in a tax period to determine the extent of availing the Input Tax Credit to which goods are used, [30][***]consumed or supplied or intended to be used, in the course of making taxable sales, shall be fair and reasonable or as prescribed. In the circumstances if any other methods are used, the prescribed authority may, after giving sufficient reason in writing, reject the method adopted by the registered dealer and calculate the amount of input tax credit after giving the registered dealer concerned an opportunity of being heard.

(11)   The State Government may, by notification in the official gazette, specify any goods or class of dealers that shall not be entitled to full or partial input tax credit.]

Section 19 - Input tax credit exceeding tax liability

19. Input tax credit exceeding tax liability.--

(1)     If the input tax credit of a registered dealer other than an exporter selling goods outside the territory of India determined under Section 18 of this Act for a period, exceeds the tax liability for that period, the excess credit shall be set off against any outstanding tax payable, penalty or interest payable under this Act as well as CST Act 1956.

(2)     The excess input tax credit after adjustment under sub-Section (1) may be carried over as an input tax credit to the subsequent period or periods.

(3)     In case where input tax credit is carried forward, a quarterly credit statement may be submitted by the dealer concerned and the claims shall be scrutinised by the prescribed authority.

Explanation-I ? Notwithstanding anything contained in this Act, no input tax credit shall be admissible by a registered dealer, where there is nil turnover by such registered dealer for a consecutive [31][twelve] months. 

Explanation-II - The Explanation-I shall not be applicable in the circumstances of dealers registered u/s 22 and 58. 

Explanation-III - The period or periods for the purpose of this Section, shall mean one alendar month or quarter or year. 

Section 20 - Input Tax Credit on the Closing Stock of Registered Dealers prior to Appointed date

Full input tax credit shall be allowed in the manner prescribed for goods purchased on and after 1.4.2005 and which have borne the incidence of tax under the provisions of adopted Bihar Finance Act 1981 Part I , and held as closing stock on the Appointed Day and are sold or re-sold thereafter against the current VAT liability, or consume such goods in the manufacture of taxable goods which are sold against the current VAT liability and or consume such goods for direct use in mining.

Section 21 - Adjustment of Input Tax Credit

Where any purchaser, being a registered dealer, has been issued with a credit note or debit note in terms of sub-Section (1) of Section 24 or if he returns or rejects goods purchased, as a consequence of which, the input tax credit availed by him in any period in respect of which the purchase of goods relates, becomes less or excess, he shall compensate such less credit or excess credit by adjusting the amount of tax credit allowed to him in respect of the tax period in which the credit note or debit note has been issued or goods are returned subject to conditions as may be prescribed.

Section 22 - Levy of Presumptive Tax on Registered 1[Dealers]

22. Levy of Presumptive Tax on Registered [32][Dealers]

(1)     The State Government may, subject to such conditions and restrictions as may be specified and prescribed, permit any class or description of registered dealers to pay a lump-sum amount by way of presumptive tax according to the capacity or to the extent of business, calculated at a flat rate on the gross receipt or gross turnover of purchases or of sales as prescribed. And such presumptive tax shall be paid at such intervals and in such manner as may be prescribed, subject to the condition that no input tax credit shall be admissible to such dealer;

Provided that payment of tax under this Section shall not apply to a registered dealer, who is a manufacturer or who imports goods from outside the State for the purpose of carrying out his business:

Provided further that a registered dealer may, by exercising option in the prescribed manner, elect to pay tax as specified under Section 9 or Section 10 of this Act in lieu of the provisions of this Section.

[33][Provided further that if the Government considers it necessary to do so, in the public-interest, may allow any registered dealer, who may be a manufacturer to pay presumptive tax, notified in this behalf, with certain conditions and restrictions for a specific period.]

(2)     Where the registered dealer is permitted to pay the lump-sum amount as presumptive tax under sub-Section (1) of this Section, the provisions of Section 29, 35 and 36 shall not apply so long as he complies with all the terms and conditions as prescribed under this Section.

Section 23 - Powers of Government to Amend Schedules

[34][The Government may, by notification, add to or delete or amend or alter any of the items in the Schedules appended to this Act]

Section 24 - Credit Notes and Debit Notes

(1)     Where a tax invoice has been issued and the amount shown as tax charged in the tax invoice exceeds the Tax Payable under this Act in respect of that sale the registered dealer making the sale shall provide the purchaser with a credit note containing the requisite particulars as may be prescribed.

(2)     Where the tax invoice has been issued in respect of any sale, and the tax charged in the Tax Invoice in respect of that sale is found to be less than the amount of tax payable under this Act, the registered dealer making the sale, shall provide the purchaser with a Debit Note, containing the requisite particulars, as may be prescribed.

(3)     In case of goods returned or rejected by the purchaser, a credit note shall be issued by the selling dealer to the purchaser and a debit note will be issued by the purchaser to the selling dealer containing the particulars as may be prescribed.

Section 25 - Compulsory Registration of Dealers

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

Provided that a dealer liable to pay tax shall be allowed one-month time from the date from which he is first liable to pay such tax to get himself registered.

(2)     Every dealer required by sub-Section (1) to be registered shall make application in this behalf in the prescribed manner to the prescribed authority and such application shall be accompanied by a declaration in the prescribed form duly filled in and signed by the dealer specifying therein the class or classes of goods dealt in or manufactured by him.

(3)     If the said authority is satisfied that an application for registration is in order, he shall, in accordance with such manner as may be prescribed, grant registration to the applicant and issue a certificate of registration in the prescribed form which shall specify the class or classes of goods dealt in or manufactured by him.

(4)     The prescribed authority may, from time to time, amend any certificate of registration in accordance with information furnished or otherwise received, and such amendment may be made with retrospective effect in such circumstances and subject to such restrictions and conditions as may be prescribed.

(5)     When-

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

(b)      a dealer has ceased to be liable to pay tax; or

(c)      an incorporated body is closed down or if it otherwise ceases to exist; or

(d)      the owner of the proprietary business dies leaving no successor to carry on business; or

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

(f)       a person or dealer is registered by mistake, or

(g)      a dealer fails to furnish return and pay tax and interest according to such return or returns within the time extended, the prescribed authority shall cancel the registration of such dealers in the prescribed manner.

(6)     The cancellation of registration will take effect from the end of the period in which it is cancelled unless it is to take effect from a different date as ordered by the prescribed authority

(7)     When any dealer to whom a certificate of registration is granted has failed to pay any tax, penalty or interest payable under this Act or has failed to furnish return, knowingly furnished incomplete or incorrect Return or failed to account for the Tax/Retail invoice or no business at the declared place or discontinued the business without informing such discontinuation or conducted business with an intention to evade tax or attempt to evade tax, or has prevented or obstructed or abated the prevention or obstruction of any survey, inspection, entry, search or seizure by a Prescribed Authority, the certificate of registration of such dealer may be suspended by the appropriate Registering Authority in the manner as may be prescribed, without prejudice to any other action, which may be taken against him under this Act.

Provided that the certificate of registration of a dealer shall not be suspended if he has furnished return or returns within the date prescribed in the notice and has paid tax, penalty or interest payable under this Act by such date, as the prescribed authority may extend upon an application filed by the dealer within 15 days from the date by which he is required to file such return or returns or make payments of tax, interest or penalty, as the case may be.

(8)     Suspension of Certificate of registration will be withdrawn and registration certificate shall be restored on an application made by the dealer on furnishing evidence of payment of all taxes, interest and penalty as case may be and on furnishing of overdue return or returns within 15 days from the date of such Application.

(9)     In all cases, where the certificate of registration is suspended, restored or cancelled, the registering authority, shall display the fact in the office notice board, publish such fact in the Commercial Tax Gazette and Official website of the Commercial Taxes Department of Jharkhand.

[35][(10) Any person intending to establish an industrial unit in the state for manufacture of taxable goods for sale of value exceeding rupees fifty thousand in a year notwithstanding that he is not liable to pay tax under section 8 of this Act, may get himself registered under this Act.]

Section 26 - Voluntary Registration of Dealers

(1)     Any dealer, whose gross turnover of sales during a financial year exceeds twenty five thousand rupees, may, notwithstanding that he is not liable to pay tax, apply in the prescribed manner to the prescribed authority for registration under this Act.

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

[36][***]

(3)     The registration of a dealer on 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.

(4)     Subject to the provisions of sub-Section (3), a dealer registered on 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 this Act cancel the registration accordingly.

(5)     When the gross turnover of sales of any dealer registered on application made under this Section has, for three successive years after the period of three years referred to in sub-Section (3), failed to exceed the taxable quantum, the prescribed authority may, after giving the dealer a reasonable opportunity of being heard, cancel registration of such dealer.

Section 27 - Security to be furnished in certain Cases

(1)     The prescribed authority may, at the time of grant of certificate to a dealer, for good and 'sufficient reasons to be recorded in writing, require the dealer to furnish in the prescribed manner such security or such additional security as may be specified by him for securing proper and timely payment of tax or any other sum payable by him under this Act.

(2)     The prescribed authority may, by order in writing and for good or sufficient reason to be recorded therein, demand from any person other than a registered dealer who imports into Jharkhand State any consignment of goods, a reasonable security for ensuring that there is no evasion of tax.

(3)     The prescribed authority may, by order in writing and for good or sufficient reasons to be recorded therein, forfeit the whole or any part of the security or additional security referred to in sub-Section (1) or sub-Section (2), furnished by a dealer, for-

(a)      realising or recovery of tax or any other sum due, or

(b)      recovery of any financial loss caused to the State Government due to negligence or default in not making proper use of or not keeping in safe custody, blank or unused forms of way bill.

(4)     Where the security furnished by a dealer, is forfeited in whole or is rendered insufficient, such dealer shall, on demand by order of the prescribed authority, furnish fresh or further security of the requisite amount or shall make up the deficiency, as the case may be, in such manner and within such period as may be specified by the prescribed authority.

(5)     The prescribed authority may, on application by a dealer, who has furnished security as required refund in the prescribed manner any amount of security or part thereof if such security is not required for the purposes for which it was furnished.

(6)     Security shall be furnished by a dealer, in such manner and by such time as may be specified in the order requiring to furnish, or demanding, such security.

(7)     No order shall be passed under this Section without giving the dealer an opportunity of being heard.

Section 28 - Imposition of Penalty for failure to get Registered

(1)     If a dealer, who is required to get himself registered within one month from the date from which he is first liable to pay tax, fails to get himself so registered, the prescribed authority may, after giving the dealer an opportunity of being heard, by order impose by way of penalty a sum, not less than one thousand rupees and not exceeding two thousand rupees, for each month of default:

Provided that no penalty shall be imposed under this sub-Section in respect of the same fact for which a prosecution has been instituted and no such prosecution shall lie in respect of a fact for which a penalty has been imposed under this Section.

(2)     If any penalty is imposed under sub-Section (1), the prescribed authority shall issue a notice in the prescribed form directing the dealer to pay such penalty by such date as may be specified in the notice, and the date to be specified shall not be less than fifteen days from the date of service of such notice and the penalty so imposed shall be paid by the dealer into a Government Treasury by the date so prescribed:

Provided that the prescribed authority may, for reasons to be recorded in writing, extend the date of such payment as specified in the notice in this behalf or allow such dealer to pay the penalty imposed in such number of installments as he may determine in the prescribed manner.

Section 29 - Periodical Returns and Payment of Tax

(1)     Every registered dealer shall furnish return in such form for such period, by such dates and to such authority, as may be prescribed:

Provided that the prescribed authority may, subject to such conditions and restrictions as may be prescribed, exempt any such dealer or class of dealers from furnishing such returns or permit any such dealer;

(a)      to furnish them for such different periods; or

(b)      to furnish a consolidated return relating to all or any of the places of business of the dealer in the State of Jharkhand for the said period or for such different periods and to such authority, as he may direct.

(2)     If the prescribed authority has reason to believe that the turnover of sales or the turnover of purchases of any dealer is likely to exceed or has exceeded the specified quantum as specified. In sub-Section (5) of Section 8, he may, by notice served in the prescribed manner, require such dealer to furnish return as if he were a registered dealer to furnish return, but no tax shall be payable by him unless his gross turnover exceeds the specified quantum provided under sub-Section (5) of Section 8.

(3)     If any dealer having furnished returns under sub Section (1) or sub-Section (2), discovers any omission or any other error In the return so filed, he may furnish a revised return before the expiry of three months, following the last date prescribed for furnishing the original return relating to the tax period.

(4)     Every dealer required to file return under sub-Section (1) or sub-Section (2) shall pay the full amount of tax payable according to the return or the differential tax payable according to the revised return furnished, if any, into the Government Treasury or in such other manner as may be prescribed, and shall furnish along with the return or revised return, as the case may be, a receipt showing full payment of such amount.

(5)     Every return under this Section shall be signed and verified-

(a)      in case of an individual, by the individual himself, and where the individual is absent by some person duly authorised by him in this behalf;

(b)      in the case of a Hindu Undivided family, by the Karta;

(c)      in the case of a company or local authority, by the principal officer or Chief Executive 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 the person competent to act on behalf of the association.

Explanation :- For the purpose of this section, the post of " Principal Officer " shall have the same meaning as that of section 2, part 35 of Income Tax Act, 1961.

Section 30 - [Substituted]

30. [37][Return and Payment Defaults]

[38][(1) If a dealer required to furnish return under sub-section (1) or sub-section (2) of Section 29; without any sufficient cause;

(a)      fails to furnish any return by the prescribed date as required under subsection (1) or sub-section (2) of Section 29; or

(b)      being required to furnish revised return, fails to furnish the revised return by the date prescribed under sub-section (3) of Section 29;

The prescribed authority shall, after giving such a dealer an opportunity of being heard in the manner prescribed, impose a penalty at the rate not exceeding rupees fifty for every day of such default for any month or any tax period, subject to a maximum of rupees twenty-five thousand in a year.

Explanation-'Return' for the purpose of sub-section (1) shall mean and include the Monthly Abstract, Return for any tax period, Revised Return(s) as well as the Annual Return.

(2) If a dealer fails without sufficient cause to pay the amount of tax due, as prescribed, such dealer shall be liable to pay interest in respect of the tax payable by him for the period at the rate of 2% per month from the date the tax payable has become due to the date of its actual payment.

Explanation I - 'Tax due' for the purpose of sub section (2) of this section shall include the amount claimed as adjustment towards Input Tax Credit but not supported by the evidence as prescribed.

Explanation II- 'Month' for the purpose of sub-section (2) of this section, shall mean thirty days and the interest and penalty payable in respect of a period of less than one month shall be computed proportionately.]

Section 31 - Collection of Tax only by Registered Dealers

No person who is not a registered dealer shall collect in respect of any sale of goods by him in the State of Jharkhand any amount by way of tax under this Act and no registered dealer shall make any such collection except in accordance with the provisions of this Act and the Rules made there under and not beyond the rate specified.

Notwithstanding anything contained in this Section a registered dealer who has been permitted by the Government to pay presumptive tax under Section 22 or Composition Tax under Section 58, shall not collect any sum by way of tax on the sale of goods during the period to which such payment relates.

Section 32 - Rounding off of the Amount of Tax or Penalty

The amount of tax or penalty payable or refundable for any period under the provisions of this Act shall be rounded off to the nearest rupee and, for this purpose, where such amount contains a part of a rupee, then, if such part is fifty paise or more, it shall be increased to one rupee and, if such part is less than fifty paise, it shall be ignored.

Section 33 - Scrutiny of Returns

[39][(1) The prescribed authority may, within a period of five years from the end of tax period and in the manner prescribed, scrutinize every return filed under section 29 for the purpose of ascertaining that -

(a)      all calculations contained therein are arithmetically accurate,

(b)      the output tax, the input tax, the tax payable and interest payable, if any, have been computed correctly and properly,

(c)      the rates of tax have been applied correctly,

(d)      evidence, as prescribed, has been furnished with regard to payment of tax and interest payable, if any, and

(e)      the deductions claimed therein are substantiated in the manner and form prescribed under the Act or under any other law for the time being in force,

(2) If, upon scrutiny under sub-section (1), the prescribed authority discovers any error, he shall serve a notice in the prescribed form on the concerned dealer directing him to-

(a)      explain, within thirty days, the reasons for failures to comply with the requirements specified in clauses(a) to (e) of sub-section (1)

(b)      pay, within thirty days, the extra amount of tax along with the interest, if any, payable and furnish the challan evidencing such payment,

(3)    (a) the prescribed authority shall, in a case falling under clause (a) of sub-section (2) and after giving the dealer a reasonable opportunity to adduce necessary evidence, pass such order in the matter as it may deem fit,

(b) if, pursuant to an order under clause (b) of sub-section (2), any tax or interest is found to be payable by a dealer, a notice in the form and manner prescribed, shall be served upon the dealer requiring him to pay the tax and interest within the time as may be prescribed,

(c) If the prescribed authority is satisfied that the dealer has concealed any sales or purchase or any particulars thereof, with a view to reduce the amount of tax payable by him under this Act or has furnished incorrect statement of his turnover or incorrect particulars of his sales or purchases in the return furnished under of section 29;

The prescribed authority shall, after giving such a dealer an opportunity of being heard, by an order in writing direct that he shall in addition to any tax payable which may be assessed under section 35 or 36 or 38, pay by way of penalty a sum equal to twice the amount of tax on the concealed turnover.

(d) Any tax , interest or penalty payable under clause (b) and (c) shall be deemed to be an arrear of tax within the meaning of section 43.]

Section 34 - Tax Audit

(1)     The prescribed authority shall undertake tax audit of the records; stock in trade and the related documents of the dealer, who are selected by the Commissioner in the manner as may be notified for the purpose.

(2)     The tax audit shall be generally taken up in the office, business premises or warehouse of the dealer.

(3)     For the purpose of tax audit under sub-Section (1) the prescribed authority or any other tax officer directed by him shall examine the correctness of return or returns filed and admissibility of various claims including input tax credit.

Section 35 - Self Assessment

(1)     Subject to provisions of sub-Section (2), the amount of tax due from a registered dealer or a dealer liable to be registered under this Act shall be assessed in the manner hereinafter provided, for the Tax Period during which the dealer is so liable as prescribed.

(2)     Notwithstanding anything contained in this Section, if a registered dealer has failed to furnish return or returns under sub-Section (1) of Section 29 in respect of any tax period or periods, the prescribed authority shall proceed to make provisional assessment under Section 36.

[40][(3) Where a registered dealer having turnover upto 1 (one) crore per annum other than the registered dealer referred to under sub-section 5 has furnished:

(a)      All the returns for any tax period.

(b)      Revised returns and annual returns in respect of any tax period within the prescribed time and in the prescribed manner.

(c)      Has paid the tax payable according to such returns or revised returns as also interest payable if any.

(d)      Has furnished the Audit report within the prescribed time if required and in the prescribed manner.

The returns so filed are found to be in order shall be accepted as self -assessment in the prescribed manner subject to adjustment of any arithmetical errors apparent on the face of the said return(s) and his assessment shall be deemed to be have been made for the purpose of sub-section (1) of Section 35, provided this provision shall not applicable to dealers covered under section 19 of the Act.]

[41][Without prejudice to the provisions of section 33 but subject to provisions of section 40, every registered dealer having turnover upto rupees 2 (two) crores per annum who has furnished the returns or revised returns along with evidences in support of payment of tax due with interest if payable, on or before the expiry of due date of filing of annual return according to sub-section (1) of section 29, shall be deemed to have been assessed excluding the dealers covered under section 19 of this Act.

Provided that the dealer shall be required to submit evidences in support of claims made in the returns within four months of the promulgation of this Act or the due date of filing the return whichever is later.]

(4) The amount of input tax credit, exemptions and other credits or concessions claimed by the dealer in the return(s) for which no supporting declarations, certificates or evidence required under this Act or Central Sales Tax Act is furnished, self assessment shall be made accordingly without such input tax credit, exemption and other claims, treating such sales as taxable by levying appropriate rate of tax, notwithstanding the fact that the dealer may have been prevented by sufficient cause to produce such declarations, certificates or evidence in support of his claim.

(5) If a dealer has furnished all the returns and the revised returns, if any, within the prescribed period and in the prescribed manner or within next fifteen days thereafter and -

(a)      The prescribed authority is satisfied that the returns or the revised returns as the case may be, and self assessment claim are prima-facie correct, consistent and complete, he shall accept the self assessment as filed by the dealer and shall assess the amount of tax and interest due from the dealer on the basis of such returns, after making prima-facie adjustment in the nature of arithmetical errors, if any, in the returns and the self assessment;

(b)      If the self assessment has not been filed within the time prescribed or if filed, the prescribed authority is not satisfied that the return or the revised returns as the case may be, and the self assessment are consistent and complete, he may, assess after allowing the dealer an opportunity of being heard, the amount of tax and interest due from the dealer on the basis of such returns and documents which have come on record, after making such adjustments as may be necessary including ?

(i)       disallowance of claim of input tax credit, exemptions and deductions and any other concessions or rebates not supported by requisite evidence as required under the Act or the rules made there under; and

(ii)      disallowance of claims of tax payments and refund adjustment not verified or otherwise not admissible; and

(iii)     withdrawal of claim of tax credit including carry forward of tax credit not admissible; and

(iv)    levying of interest applicable under this Act.

(6) In the circumstances, if the self-assessment under sub-section (1), (2), (3), (4) and (5) has not been filed within the prescribed time, the prescribed authority shall serve on such dealer a notice in the prescribed manner requiring him on a date and at a 24 time and place to be specified therein either to attend in person or through an authorised representative or to produce or to cause to be produced any accounts and other evidences on which such dealer may rely in support of such returns and claims thereof and assess the dealer, the amount of tax and interest due from the dealer on the basis of such returns which have come on records and after making such adjustments as may be necessary including ?

(i)       disallowance of claim of input tax credit, exemptions, discounts and deductions and any other concessions or rebates not supported by requisite evidence as required under the Act or the rules made thereunder; and

(ii)      disallowance of claims of tax payments and refund adjustment not verified or otherwise not admissible; and

(iii)     withdrawal of claim of tax credit including carry forward of tax credit not admissible under the Act; and

(iv)    levying of interest applicable under this Act. Provided, notwithstanding anything contained in Section 36 if registered dealer fails to comply with all the terms of the notice under this sub-section or accounts and other evidence produced by him are, in the opinion of the prescribed authority incorrect, incomplete or unreliable either wholly or partly the said authority shall assess, to the best of its judgment, the amount of tax and interest due from the dealer which have come on records and after making such adjustments as may be necessary.

(7) If the prescribed authority is satisfied that goods have been sold a price higher than that shown by the dealer, he may determine value of goods at the time of the sale and proceed to assess the tax on such price. Provided before initiating such proceedings, the prescribed authority shall record his reasons for doing so and no orders shall be passed under this sub-section without giving the dealer an opportunity of being heard.

(8) No assessment under sub-section (6) shall be made after the expiry of three years, from the end of the tax period, in respect of which or part of which the tax is assessable.

[42][(9) Notwithstanding the provisions of sub-section (3), the Commissioner shall select for assessment or re-assessment a number of such dealers as he deems fit whose assessment for a year is deemed to have been made under sub-section (1) in accordance with the provision of sub-section (3) and such selection shall be made within one calendar year from the said year.

(10) (a) The Commissioner shall serve on a registered dealer referred to in the proviso to sub-section (1) or in sub-section (3) or a registered dealer who is not eligible for assessment under sub-section (2) with a notice in the prescribed form appointing a place and day and directing him,

(i)       to appear in person or by an agent entitled to appear in accordance with the provisions of section 91; or

(ii)      to produce evidence or have it produced in support of the returns; or

(iii)     to produce or cause to be produced accounts, registers, cash memoranda or other documents relating to his business.

(b) The Commissioner, after hearing the registered dealer or his agent and examining the evidence produced in compliance with the requirements of sub-clause (ii) or sub-clause (iii) of clause (a) and such further evidence as he may require, shall assess or re-assess him to tax.

(c) The Commissioner may delegate his powers to Additional Commissioner or Joint Commissioner (Hq.) or Joint Commissioner of Commercial Taxes (Admn.) or to any other officer as he deems fits as provided under sub-section 9 of Section 35]

Section 36 - Provisional Assessment

(1)   Where a registered dealer fails to furnish the return in respect of any tax period within the prescribed time, the prescribed authority shall, notwithstanding anything contained in Section 37, proceed to assess the dealer provisionally for the period for such default.

(2)   The provisional assessment under sub-Section (1) shall be made on the basis of past returns, or past records. Where no such returns are available, or on the basis of information received by the prescribed authority: the prescribed authority shall direct the dealer to pay the amount of tax assessed in such manner and by such date, as may be prescribed.

(3)   If the dealer furnishes return along with evidence showing full payment of tax, interest and penalty, if any, on or before the date of payment specified under sub-Section 2, provisional assessment made under sub-Section (1) shall stand revoked to the extent of tax demanded, interest levied and penalty imposed, on the date on which such return is filed by the dealer.

(4)   Nothing contained in this Section shall prevent the prescribed authority from assessment under Section 37; and any tax, interest or penalty paid against provisional assessment shall be adjusted against tax, interest and penalty payable under this Section.

Section 37 - Audit Assessment

(1)     Where

(a)      a registered dealer has failed to furnish any return under sub-Section (1) of 29 in respect of any period; or

(b)      a registered dealer is selected for audit assessment by the prescribed authority on the basis of any criteria or on random basis; or

(c)      the prescribed authority is not satisfied with the correctness of any return filed under Section 29; or bona fides of any claim of exemption, deduction, concession, input tax credit or genuineness of any declaration, evidence furnished by a registered dealer in support thereof; or

(d)      the prescribed authority has reasons to believe that detailed scrutiny of the case is necessary;

The prescribed authority may, notwithstanding the fact that the dealer may have already been assessed under Section 35 or 36, serve on such dealer, in the prescribed manner, a notice requiring him to appear on a date and place specified therein, which may be business premises or at a place specified in the notice, to either attend and produce or cause to be produced the books of account and all evidence on which the dealer relies in support of his returns including tax invoice, if any, or to produce such evidence as specified in the notice.

(2)     The dealer shall provide full cooperation and assistance to the prescribed authority, to conduct the proceedings under this Section at his business premises.

(3)     If proceedings under this Section are to be conducted at the business premises of the dealer, giving him a notice to be present on prescribed date and time at his business premises and it is found that the dealer or his authorised representative is not available or not functioning from such premises, the prescribed authority shall proceed to assess to the best of judgement the amount of tax due from him.

(4)     If the prescribed authority is prevented from conducting the proceedings under this Section, he may impose, a sum equal to the amount of tax so assessed, by way of penalty.

(5)     The prescribed authority shall, after considering all the evidence produced in course of proceedings or collected by him and is satisfied that;

the dealer-

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

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

(c)      has failed to comply with any notice under sub-Section (1) or sub-Section (3); or

(d)      has failed to maintain accounts in accordance with the provisions of this Act or has not regularly employed any method of accounting;

the prescribed authority shall assess to the best of his judgement, the amount of tax due from such dealer.

(6)     If the prescribed authority is satisfied that the dealer, in order to evade or avoid payment of tax-;

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

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

(c)      has availed Input Tax Credit to which he is not entitled to or

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

he shall, after giving the dealer reasonable opportunity of being heard, direct that the dealer shall pay, by way of penalty; a sum equal to [43][thrice] the amount of additional tax assessed on account of the said reasons under this Section.

Section 38 - Assessment of Dealer who fails to get himself Registered

(1)     If the prescribed authority, upon information which has come into his possession, is satisfied that any dealer who has been liable to pay tax under this Act, in respect of any period, has failed to get himself registered, the prescribed authority shall proceed in such manner as may be prescribed to assess to the best of his judgement 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 reasonable opportunity of being heard.

(2)     Notwithstanding anything contained in Section 28, the prescribed authority may, if he is satisfied that the default was without reasonable cause, direct that the dealer shall pay, by way of penalty, in addition to the amount of tax so assessed, a sum equal to the amount of tax assessed or a sum of rupees ten thousand whichever is greater.

Section 39 - No Assessment after five years

(1)     No assessment under Section 37 or 38 shall be made after the expiry of five years from the end of the tax period to which the assessment relates

Provided that in case of offence under this Act for which proceeding for prosecution has been initiated, the limitation as specified in this sub-Section shall not apply.

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

Section 40 - Turnover escaping Assessment

(1)     Where after a dealer is assessed under Section 35 or Section 36 for any year or part thereof, and the Prescribed Authority, upon information or otherwise has reason to believe that the whole or any part of the turnover of the dealer in respect of any period has ?

(a)      escaped assessment; or

(b)      been under assessed; or

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

(d)      been wrongly allowed any deduction therefrom; or

(e)      been wrongly allowed any credit therein; the prescribed authority may, serve or cause to serve a notice on the dealer and after giving the dealer reasonable opportunity of being heard and making such inquiries as he considers necessary, proceed to assess to the best of his judgement, 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.

Provided, for clause (a), where the prescribed authority has reasons to believe that the dealer has concealed, omitted or failed to disclose willfully, the particulars of such turnover or has furnished incorrect particulars of his such turnover and thereby return figures are below the real amount, the prescribed authority shall proceed to assess or reassess the amount of tax due from the dealer in respect of such turnover and the provisions of this Act, shall so far as may apply accordingly and for this purpose [44][the dealer shall pay by way of penalty, a sum equal to thrice the amount of additional tax assessed], [45][***].

[46][Provided further that for clause (f) if the tax has already been assessed and levied on the concealed turnover during assessment, the prescribed authority shall impose only penalty on the dealer equal to thrice the amount of additional tax assessed and levied.]

[47][(f) been concealed in the returns filed or accounts maintained or other evidences produced by the dealer are incorrect, incomplete or unreliable;]

(2)     If the prescribed authority in the course of any proceeding or upon any information, which has come into his possession before assessment or otherwise, under this Act, and is satisfied that any registered dealer or a dealer to whom the registration certificate has been suspended under sub-section (7) of Section 25 ?

(a)      has concealed any sales or purchases or any particulars thereof, with a view to reduce the amount of tax payable by him under this Act, or

(b)      has furnished incorrect statement of his turnover or incorrect particulars of his sales or purchases in the return furnished under sub-section (1) of Section 29; or otherwise, the prescribed authority shall, after giving such a dealer an opportunity of being heard, by an order in writing direct that he shall, in addition to any tax payable which is or may be assessed under Section 35 or 36 or 38, pay [48][by way of penalty a sum equal to thrice the amount of tax on the concealed turnover or on concealed or incorrect particulars] of such suppression or concealment or for furnishing incorrect particulars; on the amount of tax payable under the Act or on the suppressed turnover or on concealed turnover or for furnishing incorrect particulars.

[49][The penalty shall be levied before the completion of the assessment and for determining the amount of penalty payable, the prescribed authority shall quantify the amount of tax payable provisionally under this Act.]

(3)     Any penalty imposed or interest levied under this section shall be without prejudice to any action, which is or may be taken under Section 84 of this Act.

(4)     No order of assessment and reassessment shall be made under sub-Section (1) after the expiry of five years from the end of the year in respect of which or part of which the tax is assessable.

Section 41 - Exclusion of time period for Assessment

In computing the period of limitation specified for assessment or reassessment, as the case may be, the time during which any assessment or reassessment proceeding remained stayed under the order of a competent Court shall be excluded.

Section 42 - Power of Reassessment in certain Cases

(1)   Where any order passed by the prescribed authority in respect of a dealer for any period is found to be erroneous or prejudicial to the interest of revenue consequent to, or in the light of any judgment or order of any Court or Tribunal, which has become final, then notwithstanding anything contained in this Act, the prescribed authority may proceed to reassess the tax payable by the dealer in accordance with such judgment or order, at any time within a period of three years from the date of the Judgment or order.

(2)   Where any Court or Tribunal passes an order in appeal or revision to the effect that any tax assessed under this Act or the Central Sales Tax Act, 1956 should have been assessed under the provision of a law other than that under which it was assessed, then in consequence of such order or to give effect to any finding or direction contained in such order such turnover and part thereof, may be assessed or reassessed, as the case may be, to a tax at any time within two years from the date of such order, notwithstanding any limitation period which would otherwise be applicable to, the assessment or reassessment made.

Section 43 - Payment and Recovery of Tax, Penalty and Interest

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

(2)     A registered dealer furnishing returns under sub-Section (1) of Section 29 shall pay into Government treasury, in such manner and at such interval as may be prescribed, the amount of tax due from him for the period covered under the return along with the amount of penalty or interest or both payable by him under Section 29 and shall furnish a receipt from the Treasury, showing the payment of such amount.

(3)     A registered dealer furnishing a revised return in accordance with the sub-Section (3) of Section 29, which shows that a higher amount of tax is due than what was paid or payable in accordance with the original return, shall furnish along with the return a receipt showing payment of the differential amount in the manner provided in sub-Section (2).

(4)     (a) The amount of tax-

(i)       due where returns have been filed without full payment of tax due; or

(ii)      assessed under Section 35, Section 36 and Section 37 less the sum already paid in respect of such period together with interest, if any, required to be paid and the penalty, if any, imposed to be paid under sub-Section (6) of Section 37 or sub-Section (2) of Section 38.

(b) the amount of penalty imposed under any provision of this Act not covered under sub-clause (ii) of clause (a); or

(c) any other dues under this Act;

Shall be paid by the dealer or the person concerned in the Government Treasury, or in such other manner, as may be prescribed by such date as may be specified in a notice issued by the prescribed authority for this purpose and the date to be so specified shall, ordinarily, not be less than 30 days from the date of service of such notice;

Provided that the prescribed authority may, in respect of any particular dealer or person and for reason to be recorded in writing extend the date of such payment or allow such dealer or person to make payment of such dues in installment.

Provided further that where the prescribed authority considers it expedient in the interest of State revenue, it may, for the reasons to be recorded in writing require any dealer, or person to make payment forthwith.

(5)     Notwithstanding any contained in the Act, the Prescribed Authority may, subject to such conditions and restrictions as may be prescribed, in respect of any particular dealer or person and for reasons to be recorded in writing, extend the date of such payment and allow such dealer or person to pay any demand in installments on the condition that the said dealer or the person furnishes sufficient security to the satisfaction of Prescribed Authority.

(6)     Where a dealer fails to make payment of the tax assessed or interest levied or penalty imposed on him or any other amount due from him under this Act within thirty days of the date of service of the notice of demand, the prescribed authority shall, after giving the dealer reasonable opportunity of being heard, direct that such dealer shall, in addition to the amount due pay, by way of penalty, a sum equal to 2% of such amount of tax, penalty, interest or any other amount due, for every month, for the period for which payment has been delayed by him after the date on which such amount was due to be paid.

(7)     The amount that remains unpaid even after the due date of payment or installment granted in pursuance of the notice issued under sub-Section (4) and sub-Section (6) shall be recoverable as arrears of land revenue.

Provided that where an appeal in respect of such amount has been entertained under Section 79, the appellate authority may, subject to such rule as may be made by the State Government under this Act, stay recovery of such amount or portion thereof for so long as the appeal remains pending or for such shorter period as the said authority may consider to be adequate.

(8)     Where in pursuance of sub-Section (6), any proceeding for the recovery as an arrears of land revenue of any tax, penalty, interest or part thereof or any other amount remaining unpaid, have been commenced and the amount of tax, penalty, interest or any other amount is subsequently enhanced or reduced as a result of any assessment made or order passed in the appeal revision or rectification under this Act, the prescribed authority may, in such manner and within such period as may be prescribed, inform the dealer and the authority by whom or under whose order the recovery is to be made and there upon such proceeding may be continued as if the amount of tax, penalty, interest or any other amount as modified, enhanced or reduced, had been substituted for the tax, penalty, interest or any other amount which was to be recovered under sub-Section (7).

Section 44 - Special Provisions relating to Deduction of Tax at source in certain Cases

(1)     The State Government may, having regard to the effective recovery of tax, require in respect of contractors or any other class or classes of dealers that any person making payment of any valuable consideration to them for the execution of a works contract in the State involving transfer of property in goods, whether as goods or in some other form or for sale of goods in the State, as the case may be, shall, at the time of making payment, whether by cash, adjustment, credit to the account, recovery of dues or in any other manner, deduct tax in advance therefrom which shall be calculated by multiplying the amount paid in any manner with such rate not exceeding ten per cent, as the State Government may, by notification in the Official Gazette, specify and different rates may be specified for different works contracts or class or classes of dealers, and that such person shall keep record, of the payments made and, of the tax deducted in advance therefrom, for a period of five years from the close of the year when the payments were made and shall produce such record before the prescribed authority when so required for carrying out the purposes of this Act.

Provided that, no deduction shall be admissible, in the circumstances, where a works contractor opts for Composition Scheme of Tax under Section 58 of the Act.

(2)     The provisions of sub-Section (1) shall not apply where the amount or the aggregate of the amounts paid or likely to be paid during a year by any person to a dealer does not or is not likely to exceed one lakh rupees or such other amount as may be prescribed.

(3)     Every person who is required to deduct tax in advance under sub-Section (1) shall furnish such returns at such intervals by such dates in such manner to such authority as may be prescribed and shall pay the tax deducted according to such returns to the State Government in such manner as may be prescribed.

(4)     Every person referred to in sub-Section (3) shall issue to the payee a certificate of tax deduction and payment in such form in such manner as may be prescribed.

(5)     Any tax paid to the State Government in accordance with sub-Section (3) shall be adjustable by the payee, on the authority of the certificate issued to him under sub-Section (4), with the tax payable by him under this Act and the assessing authority shall, on furnishing of such certificate to it, allow the benefit of such adjustment after due verification of the payment.

(6)     If any person fails to deduct the whole or any part of the tax as required by or under the provisions of sub-Section (1), or fails to pay the whole or any part of the tax as required by or under sub-Section (3), then, the authority referred to in sub-Section (3) may, at any time within five years of the close of the year when he failed to do so, by order in writing, direct him, after giving him a reasonable opportunity of being heard, to pay, by way of penalty, a sum equal to the amount of tax which he failed to deduct or pay as aforesaid.

Section 45 - Special Provision relating to Advance Recovery of Tax on Sales and Supplies to Governments and Other Persons

(1)     Notwithstanding anything contained in this Act but subject to the provisions of Section 14, 49 and 57, any person responsible for paying sale price or any amount purporting to be the full or part payment of sale price in respect of sales or supplies of taxable goods exceeding rupees one lac during a year made to-

(i)       the State Government; or

(ii)      Central Government; or

(iii)     a Company, Corporation, Board, authority, undertaking or any other body owned, financed or controlled either wholly or partly by the State Government or the Central Government shall, at the time of payment, subject to such conditions and restrictions as may be prescribed, deduct an amount at the rate as may be specified by the State Government by a notification on account of tax on the amount of such payment:

Provided that the rate or rates to be specified by the State Government shall not be more than the rate of tax applicable to the goods sold or supplied.

(2)     Notwithstanding any law or contract to the contrary, the person making such deduction shall be lawfully competent to make such deduction.

(3)     Payment of the amount deducted under sub-Section (1) into the Government Treasury in the prescribed manner, shall be the liability of the person making such deduction.

(4)     Payment of the amount deducted under sub-Section (1) into the Government Treasury by the person making the deduction shall be deemed to be a payment by or on behalf of the seller or supplier concerned.

(5)     If any person contravenes any or all of the provisions of sub-Section (1), (2) or (3), he shall be liable to pay, by way of penalty, a sum not exceeding twice the amount of tax deductible under sub-Section (1):

Provided that such penalty shall not be imposed unless the person contravening the provisions is given an opportunity of being heard by the prescribed authority.

(6)     The provisions of Section 43 and 47 for recovery of any amount of tax due from a dealer shall, mutatis mutandis, apply for recovery of any amount of tax deducted and or any penalty imposed but not deposited under this Section.

Explanation:- A "person" in this Section includes all officers or authorities who are competent or authorised to make payment of the sale-price including the tax charged in respect of sales to State Government or Central Government or to Company, Corporation, Board, authority, undertaking or any other body owned, financed or controlled wholly or partly by the State Government or the Central Government.

(7)     The provisions of sub-Sections (4) and (5) of Section 44 of the Act shall, mutatis mutandis, apply, so far as it relates, to issuance of certificate to person from whose bills deduction has been made and for filing of quarterly statements.

Section 46 - Special mode of Recovery

(1)     Notwithstanding anything contained in Section 43 or any law or contract to the contrary, the prescribed authority may at any time or from time to time, by notice in writing, ( a copy of which shall be forwarded to the dealer at his last known address) direct-

(a)      Any person from whom any money is due or may become due to a dealer who has failed to comply with a notice of demand served under Section 43, or

(b)      Any person who holds or may subsequently hold any money for, or on account of such dealer,to pay into the Government Treasury in the manner specified in the notice, either forthwith or upon the money becoming due or being held, or at or within the time specified in the notice (not being before money becomes due or is held) so much of the money as is sufficient to pay the amount of tax due from the dealer, together with penalty, as the case may be, under this Act, or part or the whole of the money when it is equal to or less than that amount.

(2)     The prescribed authority issuing the notice under sub-Section (1) may at any time or from time to time, amend or revoke any such notice or extend the time for making such payment in pursuance of the notice.

(3)     Any person making any payment in compliance with a notice issued under sub-Section (1) shall be deemed to have made the payment under the authority of the dealer and the receipt from the Government Treasury shall construe a good and sufficient discharge of the liability of such person to the dealer to the extent of the amount specified in the receipt.

(4)     Any person discharging any liability to the dealer after service on him the notice issued under sub-Section (1) shall, if the liability is discharged in any manner other than that required under the said notice, be personally liable to the State Government to the extent of the liability discharged or to the extent of the liability of the dealer for tax or penalty, or both, whichever is less.

(5)     Where a person on whom a notice is served under sub-Section (1) proves to the satisfaction of the prescribed authority that the money demanded or any part thereof were not due to the dealer, or that he did not hold any money for or on account of the dealer, at the time the notice was served on him, nor is the money demanded or any part thereof is likely to become due to the dealer or be held for or on account of the dealer, then such person shall not be liable to pay into Govt. treasury any such money or part thereof.

(6)     Any amount of money which a person is required to pay under sub-Section (1) or for which he is personally liable under sub-Section (4) shall, if it remains unpaid, be recoverable in the same manner as provided under sub-Section (7) of Section 43.

(7)     No action shall be taken under this Section in respect of any amount of tax, interest and penalty, if any, the date of payment of which has been extended or the realization of which has been stayed, under this Act during the period of such extension or stay.

Provided that nothing in this Section shall operate to affect any action taken or prevent any action that may be or is being taken under Section 43 for recovery from the dealer the amount due from him.

Section 47 - Collection of Tax by Dealer

(1)     If any person ?

(a)      not being a dealer liable to pay tax under this Act, collects any sum by way of tax; or

(b)      being a registered dealer, collects any amount by way of tax in excess of the tax payable by him shall be liable, in addition to the tax for which he may be liable, to a penalty of an amount equal to twice the sum so collected by way of tax.

(2)     If the prescribed authority in the course of any proceeding under this Act or otherwise has reason to believe that any person has become liable to a penalty, or forfeiture, or both, under sub-Section (1), he shall serve on such person a notice in the prescribed form requiring him to appear and show cause as to why a penalty or forfeiture or both of any sum as provided under sub-Section (1) should not be imposed on him.

(3)     The prescribed authority shall thereupon hold an inquiry as he deems necessary and shall make such order as he deems fit.

Section 48 - Forfeiture of Tax Collected in Violation of this Act

(1)     Any amount collected by any person in contravention of the provisions of Clause (b) of sub-Section (1) of Section 47 or any amount collected by any person by way of tax, by whatever name called, or in any other manner not payable under any provision of this Act shall be liable to forfeiture to the State Government.

(2)     If the Prescribed authority, in the course of any proceeding under this Act or otherwise, has reason to believe that any amount is liable for forfeiture under sub-Section (2) of Section 47, he shall serve, on the person who has collected such amount, a notice in the prescribed form requiring to show cause why the said amount should not be forfeited to the State Government and on receipt of the reply, if any, and after making such inquiries as may be deemed fit, he shall make an order of forfeiture if the amount is found so liable.

(3)     Where an order of forfeiture under sub-Section (2) of Section 47 has been made, the person making the unauthorized collection shall forthwith pay the amount so forfeited to the State Government, if it has not already been paid and on his failure to do so, such amount shall be recoverable from him as if it were a tax due from him.

(4)     Where an order for forfeiture is passed, the Commissioner shall publish or cause to be published, in the prescribed manner, a notice for information of the persons from whom the amount so forfeited had been collected giving such details as may be prescribed.

(5)     On the publication of the notice under sub-Section (4), a refund of such amount or part thereof may be claimed from the State Government within one year from the date of publication of the said notice by the person from whom it was unauthorisedly realized by way of tax and for this purpose the person claiming the refund shall make an application in the prescribed form.

(6)     On receipt of an application under sub-Section (5) the Commissioner shall hold such enquiry as he deems fit and if he is satisfied that the claims is valid and admissible and that the amount so claimed as refund was actually paid to the State Government and no refund or remission in respect of that amount was granted, the Commissioner shall refund such amount or any part thereof to the person concerned.

(7)     Notwithstanding anything contained in this Act or in any other law for the time being in force, where any amount collection by any person is forfeited to the State Government under this Section, such forfeiture shall, if the amount forfeited has been paid to the State Government, discharge him of the liability to refund the amount to the person from whom it was so collected.

Section 49 - Sales not liable to Tax and Zero Rated Sales

(1)     Notwithstanding anything contained in this Act, a Value Added Tax shall not be imposed under this Act;

(i)       Where such sale or purchase takes place outside the State of Jharkhand; or

(ii)      Where such sale or purchase takes place in the course of Import of goods into the territory of India or Export of goods out of the territory of India.

(2)     The following shall be Zero-rated sales for the purpose of this Act, and shall be eligible for Input Tax Credit under sub-Section (4) of Section 18 of this Act ?

(i)       Sale of taxable goods in the course of inter-State trade and commercefalling within the scope of Section 3 of the Central Sales Tax Act, 1956.

(ii)      Sale of goods falling within the scope of sub-Sections (1) and (3) of Section 5 of the Central Sales Tax Act, 1956.

(iii)     Sale of goods: to an unit located in Special Economic Zone or a STP unit or an EHTP unit or an EOU unit.

(3)     For the purpose of this Section, whether a sale or purchase takes place;

(i)       outside the State of Jharkhand or

(ii)      in the course of inter-state trade and commerce; or

(iii)     in the course of Import of goods into the territory of India or Export of goods out of the territory of India.

shall be determined in accordance with the provisions of Section 3, 4 and 5 of the Central Sales Tax Act, 1956.

Section 50 - Tax to be first charge on Property

(1)     Notwithstanding anything to the contrary contained in any law for the time being in force, any amount payable by a dealer under this Act on account of tax, penalty or interest or any amount which a person required to pay under this Act shall be a first charge on the property of the dealer or such person.

(2)     Where, during the pendency of any proceeding under this Act or under the Repealed Act, any person creates a charge on or parts with the possession: by way of Sale, Mortgage, Gift, Exchange or any other mode of Transfer whatsoever, of any of his Assets in favour of any other person with the intention to defraud Revenue, such Charge or Transfer shall be void, as against any claim in respect of any tax or any other sum payable by such person, as a result of completion of the said proceeding.

Section 51 - Period of limitation for Recovery of Tax

Notwithstanding anything contained in any law for the time being in force, no proceeding for recovery of any amount under sub-Section (7) and (8) of Section 43 and sub-Section (6) of Section 47 shall be initiated after the expiry of twelve years from the date of the relevant assessment.

Provided that when an appeal or revision has been filed, the period of limitation shall run from the date on which the amount due is finally determined.

Section 52 - Refund

(1)     Subject to other provisions of this Act and the Rules made thereunder, the prescribed authority shall, refund to a dealer the amount of tax, penalty and interest, if any paid by such dealer in excess of the amount due from him.

(2)     Where any refund is due to any dealer according to return furnished by him for any period, such refund may provisionally be adjusted by him against the tax due or tax payable as per the returns filed under Section 29 for any subsequent period in the year:

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

Section 53 - Provisional Refund

(1)     If a registered dealer has filed any return as required under this Act and the return shows any amount to be refundable to the dealer on account of Zero Rated Sales or in course of export out of the territory of India, then the dealer may apply in the manner and form prescribed to the prescribed authority for grant of provisional refund pending assessment, audit and investigation to establish the correctness of the claim and consequent assessment, if any.

(2)     Provided further the Refund shall also be admissible to a registered dealer, who owns an industrial unit in the Software Technology Park, or who owns an Export Oriented Unit within the meaning of the Export and Import Policy as formulated under Section 5 of the Foreign Trade (Development and Regulation) Act, 1992 (22 of 1992), situated anywhere in Jharkhand a Special Economic Zone or Software Technology Park, the amount of tax realised or realizable from him by another registered dealer in respect of the purchases in Jharkhand-

(i)       of goods for use directly in the manufacture of goods by him in such unit for sale by him in the course of export within the meaning of Section 5 of the Central Sales Tax Act, 1956 (74 of 1956).

(ii)      of goods, being the containers or other packing material for packing of the goods manufactured in such unit.

(3)     Subject to the provisions of sub-Section (1) or (2), the prescribed authority may require the dealer to furnish a Bank Guarantee or other security as may be prescribed for an amount equal to the amount of refund and on receipt of such guarantee or other security, the prescribed authority shall grant the dealer a provisional refund for the amount that may be determined as refundable.

(4)     The prescribed authority may direct the assessment under Section 36 or 37 of such dealer in respect of the year containing the period covered by the said return to be taken up as early as practicable and adjust the grant of provisional refund against tax due, if any, as a result of that assessment.

(5)     If, on assessment, the provisional refund granted under sub-Section (3) is found to be in excess, then the excess shall be recovered as if it is tax due from the dealer under this Act.

(6)     Interest will be charged on such excess amount at the rate of two percent per month from the date of grant of provisional refund till the date of assessment.

Section 54 - Refund of Tax to certain categories

Refund of tax, paid on officials/personal purchases of foreign diplomatic missions/ their diplomats shall be allowed in the State of Jharkhand on reciprocal basis and shall be allowed to U.N. bodies/ their diplomats promptly, as prescribed.

Section 55 - Interest

(1)     A registered dealer entitled to refund in pursuance of any order under this Act (including assessment under Section 35, Section 36 or Section 37) or in pursuance of any order by any Court, shall be entitled to receive, in addition to the refund, simple interest at the rate of six percent per annum for the period commencing after ninety days of the application claiming refund in pursuance to such order till the date on which the refund in granted.

(2)     The interest shall be calculated on the amount of refund due after deducting therefrom any tax, interest, penalty or any other dues under this Act.

(3)     If, as a result of any order passed under this Act, the amount of such refund is enhanced or reduced such interest shall be enhanced or reduced accordingly.

(4)     When a dealer is in default or is deemed to be in default in making the payment under Section 35, Section 36 and Section 37, be liable to pay simple interest on such amount at the rate of two percent per month from the date of such default for so long as he continues to make default in the payment of the said tax.

(5)     Where as a result of any final order the amount of tax (including any penalty) due or in default is wholly reduced, the amount of interest, if any, paid shall be refunded, or if such amount is modified, the interest due shall be calculated accordingly:

(6)     Where any amount of tax payable is enhanced by any such order, interest shall be payable on the amount by which the tax is enhanced after the expiry of a period of three months from the date of the order.

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

(8)     The interest payable under this Act shall be deemed to be tax due under this Act.

Section 56 - Power to withhold Refund in certain Cases

(1)     Where an order giving rise to refund is the subject matter of an appeal or further proceeding or where any other proceeding under this Act is pending, and the prescribed authority is of the opinion that the grant of such refund is likely to adversely affect the revenue and that it may not be possible to recover the amount later, the prescribed authority may, withheld the refund till such time as he may determine.

(2)     Where a refund is withheld under sub-Section (1) the dealer shall be entitled to interest as provided under sub-Section (1) of Section 55, if as a result of the appeal or further proceeding or any other proceeding, he becomes entitled to the refund.

Section 57 - Exemption of certain Sales and Purchases

(1)     Subject of such conditions as it may impose, the Government may, if it is necessary so to do in the public interest, by notification in the Official Gazette, exempt any sales or purchases [50][of any class of goods] made to or by a class of dealers or persons specified in the said notification from payment of the whole or any part of any tax payable under the provisions of this Act and any notification issued under this Section may be issued so as to be retrospective to any date, not earlier than the appointed date and such exemption shall take effect from the date of the publication of the notification in the Official Gazette

or such other earlier or later date as may be mentioned therein.

(2)     Where any dealer or person has purchased any goods under a declaration or certificate given by him under any notification issued under this Section and ?

(a)      any of the condition subject to which such exemption was granted, or

(b)      any of the recitals or the conditions of the declaration, or certificate are not complied with for any reason whatsoever, then without prejudice to the other provisions of this Act, such dealer or person shall be liable to pay tax on the sale price of the goods at the rate set out against each of such goods in the Schedule-II notwithstanding that such dealer or person was not liable to pay tax under any other provisions of this Act and accordingly the dealer or the person who has become liable to pay tax under this sub- Section shall file a return in the prescribed form to the prescribed authority within a prescribed time and shall include the sale price of such turnover in his return, and pay the tax in the prescribed manner. The tax due from any such dealer or person shall be assessed and recovered as if the person or dealer is a dealer liable to be proceeded against under the provisions of this Act.

(3)     If the prescribed authority has reason to believe that any person or dealer is liable to pay tax under sub-Section (2), the prescribed authority shall, after giving him a reasonable opportunity of being heard, assess the amount of tax so due.

(4)     Notwithstanding anything contained in this Act, the power to exempt any sales or purchases to or by a class of dealers or persons specified in any notifications thereof shall also include to withdraw, amend, alter or delete the said notification(s).

Section 58 - Composition of Tax

(1)     (a) The State Government may, by a notification in the Official Gazette, in lieu of the amount of tax payable under this Act; provide for a Scheme of Composition of Tax Payable: by such dealers or class of dealers, or dealers who are engaged in the business of reselling at retail of any goods, or dealers who are liable to pay tax on sales effected by way of transfer of property in goods (whether as goods or in some other form) involved in the execution of a works contract; subject to such conditions and restrictions as may be specified and as prescribed.

Provided the scheme of Composition of Tax shall be available to only such Dealer(s), other than the works contractors, whose gross turnover does not exceeds Rs.50 lakhs in a year.

(b) For the purpose of this Section, a dealer shall be considered to be engaged in the business of selling at retail, if 9/10th of his turnover of sales consists of sales made to such persons who are not dealers, and in the circumstances, if any question arises as to, whether any particular dealer is a retailer or not, the question shall be referred to the Joint Commissioner, who shall after hearing the dealer, if necessary, decide the question to this effect. The order made by the Joint Commissioner shall be final.

(c) Nothing in this sub-Section shall apply to a dealer who is a Manufacturer, or who is an Importer of goods into the State, or who sells liquor: including liquor imported from outside of India, or Indian Made Foreign Liquor or Country Liquor.

(d) The provisions of Section 44 shall not apply to such contractors, who have been granted permission to pay tax by way of composition; so long they comply with all the terms and conditions as specified in the Notification and prescribed in Rule 23, read with sub-rule (7) of Rule 14.

(2)     The Rate of Tax applicable under the Composition scheme referred in this Section shall not be exceeding 8%, on the Gross Annual Turnover and no Input Tax Credit shall be admissible to such dealers.

(3)     Where the registered dealer is permitted to pay tax by way of Composition Scheme under sub-Section (1) of this Section, the provisions of Section [51][***] 35 and 36 shall not apply to him, so long as he complies with all the terms and conditions as specified in this Section and as prescribed.

(4)     Any dealer eligible for Composition of Tax under sub-Section (1) may apply, to the Prescribed Authority in the prescribed manner, to exercise his option and he shall pay such amount due, and furnish a Return in such manner as may be prescribed.

Provided that once the dealer elects the option to pay tax under this Section, the option may be reversed only after the end of the year for which the option is made, by an Application to the Prescribed Authority, within such time and in such manner as may be prescribed.

Provided further, such dealer shall not be allowed to issue Tax Invoice, and shall not be allowed to collect any amount, by way of Tax under this Act.

Section 59 - Maintenance of Accounts and Records etc.

(1)     Every registered dealer or a dealer to whom a notice has been served to furnish return under sub-Section (2) of Section 29 shall maintain a true and up to date account of the value of goods purchased or manufactured and sold by him or goods held by him in stock, and, in addition to the books of account that a dealer maintains and keeps for the purpose referred to in this sub-Section, he shall maintain and keep such registers and accounts in such form in the manner prescribed.

(2)     Every registered dealer or dealer referred to in sub-Section (1) shall keep at his place of business all accounts, registers and documents maintained in the course of business.

(3)     Where a dealer as referred to in sub-Section (1) has established branch offices of the business in the State other than the principal place of business, the relevant accounts, registers and documents in respect of each such branch shall, without prejudice to the provisions of sub-Section (5), be kept by him at such branch.

(4)     If the prescribed authority is of the opinion that the accounts maintained by any dealer or class of dealers do not sufficiently enable him to verify the returns referred to in sub-Section (1) of Section 29 or the assessment can not be made on the basis thereof, he may by an order, require such dealer or class of dealers, to keep such accounts, in such form and in such manner as he may, subject to rules made under this Act, direct.

(5)     If the commissioner is satisfied that any dealer is not in a position to maintain accounts in accordance with the provisions of sub-Section (1), he may, for reasons to be recorded in writing, exempt such dealer from the operation of the provisions of the said sub-Section.

Section 60 - Tax Invoice

(1)     Every registered dealer making a taxable sale to another dealer, shall provide to the purchaser, at the time of sale with a Tax Invoice or Retail Invoice, containing such-particulars as specified in sub-Section (2), and retain a copy thereof.

(2)     The tax invoice shall not be issued by a dealer in the following circumstances, -

(a)      a retail registered dealer who is paying presumptive tax in lieu of Value Added Tax under Section 22 or Composition Tax under Section 58 or

(b)      the sale in the course of export out of the territory of India; or

(c)      the sale of goods exempt from tax

(3)     Not more than one tax invoice shall be issued for each taxable sale.

(4)     The tax invoice issued under sub-Section (1) shall contain the following particulars on the original as well as copies thereof-

(a)      the word 'Tax Invoice' in bold letter at the top or any prominent place;

(b)      the name, address and registration certificate number of the selling, registered dealer.

(c)      the name, address and registration certificate number of the purchasing registered dealer;

(d)      an individual serialized number and the date on which the tax invoice is issued.

(e)      description, quantity, volume and value of goods sold and amount tax charged thereon indicated separately;

(f)       statement of account, bill cash register, slip receipt or similar record, regardless of its forms be kept separately.

(g)      signature of the selling dealer or his servant, manager or agent, duly authorised by him;

(h)     the name and address of the printer, and first and last serial number of tax invoices printed and supplied by him to the dealer;

(5)     Except when tax invoice is issued under sub-Section (1), if a registered dealer sells any goods exceeding such amount in value as may be prescribed, in anyone transaction to any person, he shall issue to the purchaser a retail invoice and retain a copy thereof.

(6)     The retail invoice shall contain the following particulars on the original as well as copies thereof;

(a)    the words 'Retail Invoice' or 'Cash Memo-random' or 'Bill' in bold letters at the top or in a prominent place;

(b)    the name, address and registration certificate number of the selling registered dealer;

(c)    in case the sale is in course of export out of the territory of India, the name, address and registration number, if any, of the purchasing dealer/ foreign buyer and the type of statutory form, if any against which the sale has been made;

(d)    an individual serialized number and the date on which the retail invoice is issued;

(e)    description, quantity, volume and value of goods sold inclusive of tax, charged thereon;

(f)     signature of the selling dealer or his servant, manager or agent, duly authroised by him.

(g)    the name and address of the printer, and last serial number of retail invoices printed and supplied by him to the dealer

(7)     Tax invoice shall be issued in triplicate. The original and the first copy shall be issued to the purchaser or the person taking delivery of the goods, as the case may be, and the second copy shall be retained by the selling dealer.

(8)     Retail invoice shall be issued in duplicate. The original shall be issued to the purchaser and the duplicate copy shall be retained by the selling dealer.

(9)     Every dealer referred to in sub-Section (1) shall preserve books of account including tax invoices and retail invoices until the expiry of five years after the end of the year to which they relate or for such other period as may be prescribed or until the assessment reaches its finality whichever is later.

(10)   Where such dealer is party to any appeal, or revision under this Act he shall retain, until the appeal or revision is finally disposed of, every record and accounts that pertain to the subject matter of the appeal or revision.

Section 61 - Electronic Record

Every dealer who maintains the records electronically shall retain them in electronically readable format for the period specified in sub-Section (9) of Section 60.

Section 62 - Requirement to Provide Information

Notwithstanding anything contrary to the provisions of this Act, the prescribed authority may, for any purpose related to the administration or enforcement of the provisions of this Act, by notice, require any person to provide the prescribed authority, within such reasonable time as is stipulated in the notice, with any information or additional including a return under this Act, or any document including electronic records.

Section 63 - Audit of Accounts

(1)     Where in any particular year, the gross turnover of a dealer exceeds [52][60 lakh] rupees or such other amount as the prescribed authority may, by a Notification in the Official Gazette specify, then such dealer shall get his Accounts audited for the purpose of this Act, in respect to that year, by an "Accountant" or "Tax Practitioners", within six months from the end of that year and obtain a report of such Audit in the Prescribed Form, duly signed and verified by such "Accountant" or "Tax Practitioners", and setting forth such particulars, as may be prescribed.

(2)     A true copy of such report shall be furnished by such Dealer to the Prescribed Authority by the end of the month after expiry of the period of six months during which the Audit would have been completed.

(3)     If any dealer liable to get his Accounts audited under sub-Section (1) fails to get his Accounts audited and furnish a true copy of the Audit Report within the time specified in sub-Section (2), the Prescribed Authority shall, after giving the Dealer a reasonable opportunity of being heard, impose on him, in addition to any Tax Payable, a sum by way of penalty equal to 0.1% of the turnover as he may determine to the best of his judgment in his case in respect of the said period.

Section 64 - Dealer to declare the name of his Business Manager

(1)     Every dealer, who is liable to pay tax, and who is a Hindu Undivided Family or an association of persons, club or society, firm or company, or who is engaged in business as the guardian or trustee or otherwise on behalf of another person, shall within the period prescribed, furnish a declaration in the manner prescribed stating the name of the person or persons who shall be deemed to be manager or managers of such dealer's business for the purposes of this Act.

(2)     Such declaration shall be furnished at the time of registration, wherever applicable and shall be revised from time to time,

(3)     The statement furnished under this sub-Section shall also contain the name and address with designation in relation to the business of such persons who are authorised to receive notice and other documents under this Act and such service on whom shall be binding on the dealer.

Section 65 - Liability to pay Tax in Case of death

(1)     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 his legal representative or any other person, such legal representative or other person shall be liable to pay tax including any penalty, sum forfeited and interest due from such dealer under this Act or under any earlier law, in the like manner and to the same extent as the deceased dealer, and,

(b)      if the business carried on by the dealer is discontinued whether before or after his death, his legal representative shall be liable to pay out of the estate of the deceased, in the like manner and to the same extent as the deceased dealer would have been liable to pay if he had died, the tax including any penalty, sum fortified and interest due from such dealer under this Act, or under any earlier law, whether such tax including any penalty, sum forfeited and interest has been assessed before his death but has remained unpaid, or is assessed after his death,

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

(3)     Where a dealer liable to pay tax under this Act, is a firm, and the firm is dissolved, then every person who was a partner shall be jointly and severally liable to pay to the extent to which he is liable under Section 67, the tax including any penalty, sum forfeited and interest due from the firm under this Act or under any earlier law, up to the time of dissolution, whether such tax including any penalty, sum forfeited and interest has been assessed before such dissolution but has remained unpaid or is assessed after dissolution.

(4)     Where a dealer, liable to pay tax under this Act, transfers or otherwise disposes of his business in whole or in part, or effects any change in the ownership thereof, in consequence of which he is succeeded in the business or part thereof by any other person, the dealer and the person succeeding shall jointly and severally be liable to pay the tax including any penalty sum forfeited and interest due from the dealer under this Act or under any earlier law, up to the time of such transfer, disposal or change, whether such tax including any penalty, sum forfeited and interest has been assessed before such transfer, disposal or change but has remain unpaid, or is assessed thereafter.

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

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

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

(6)     Where a dealer is liable to pay tax under this Act, is succeeded in the business by any person in the manner described in clause (a) of sub- Section (1) or in sub-Section (4) then such person shall be liable to pay tax on the sales or purchases of goods made by him on and after the date of such succession and shall (unless he already holds a certificate of registration) within sixty days thereof apply for registration.

Section 66 - Certain Agents liable to Tax for Sales on behalf of Principal

(1)     Where any person sells or purchases any taxable goods on behalf of his principal then such person and his principal shall both be jointly and severally liable to pay taxes on the turnover of such sales or purchases.

(2)     If the principal, on whose behalf the commission agents has sold or purchased any goods, shows to the satisfaction of the prescribed authority that the tax has been paid by the such commission agents on such goods under sub-Section (1), the principal shall not be liable to pay the tax again in respect of the same transaction.

(3)     Where a manager or agent of a non-resident dealer sells or purchases any goods on behalf of a non resident dealer in the State, then the non-resident dealer and the manager or agent residing in the State, shall be jointly and severally liable to pay tax on the turnover of such sales or purchases:

Provided that, if the non-resident dealer shows to the satisfaction of the prescribed authority that the tax payable in respect of such sale or purchase has been paid by the manager or agent residing in the State, then the non-resident dealer shall not liable to pay in respect of the same transaction.

Section 67 - Liability of Partners

(1)     Notwithstanding anything contained in the Indian Partnership Act, 1932 or any contract to the contrary, where any firm is liable to pay tax under this Act, the firm and each of the partners of the firm shall be jointly and severally liable for such payments and accordingly any notice or order under this Act may be served on any person who was a partner during the relevant time whether or not the firm has been dissolved and all the provisions of this Act shall apply accordingly.

(2)     Where any such partner retires from the firm, he shall be liable to pay the tax, penalty, sum forfeited and interest remaining unpaid at the time of his retirement and any such amount due up to the date of retirement though un-assessed at that date.

Section 68 - Amalgamation of Companies

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

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

(3)     Words and expressions used in this Section, but not defined, will have the respective meanings to them in the Companies Act 1956.

Section 69 - Bureau of Investigation

(1)     The State Government may, by an order published in the Official Gazette, constitute a Bureau of Investigation, and it shall consist of such personnel and in such number of officers and such hierarchy of supervision and control, as may be specified by the State Government in the said order.

Provided that if authorities appointed under sub-Section (1) of Section 4 are specified as such it shall without prejudice to the powers under sub-Section (1) of Section 4 exercise the powers of an authority under Section 62, 70 and 72 for carrying out the purpose of this Act.

(2)     [53][***]

[54][(i)] The Commissioner may, by an order published in the Official Gazzette, authorise an officer of the Bureau of Investigation to exercise the powers of an authority appointed under Section 4 in respect of such matter, as may be specified in the order.

[55][(ii)] The Bureau of Investigation shall function under the control and supervision of the Commissioner, and shall discharge such duties as may be assigned to it, by the Commissioner, including investigation of offences under Section 87 of this part.

Section 70 - Production and Inspection of Accounts and Documents and search of premises

(1)     The prescribed authority may, subject to such conditions as may be prescribed, require any dealer to produce before him any accounts or documents, or to furnish any information, relating to stocks of goods of, or to sale, purchase and delivery of goods or to payments made or received by the dealer or any other information relating to his business, as may be necessary for the purpose of this Act.

(2)     All accounts, registers and documents, records, computer or any electronically stored data relating to stocks of goods of, or to purchase, sale and delivery of goods, payments made or received by any dealer and all goods and cash kept in any place of business of any dealer, shall at all reasonable time be open to inspection by the prescribed authority, and the prescribed authority may take or cause to be taken such copies or extracts of the said accounts, registers or documents and such inventory of the goods and cash found as appears to him necessary for the purpose of this Act.

(3)     If the prescribed authority has reasons to believe that any dealer has evaded or is attempting to evade the payment of any tax due from him, 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 for so long as may be necessary in connection with any proceeding under this Act or for the prosecution, under any law.

(4)     For the purposes of sub-Section (2) or sub-Section (3) the prescribed authority may enter and search any place of business of any dealer or any other place where the prescribed authority has reason to believe that the dealer keeps or is for the time being keeping any account, registers or documents of his business or stocks of goods relating to his business.

(5)     (a) If the Prescribed Authority has reasons to believe that any dealer has evaded or is attempting to evade the payment of any tax due from him, he may, for reasons to be recorded in writing, shall have the powers to seize such goods not properly accounted for in the books, accounts, registers and other documents of the dealer or the Broker, or the owner of the warehouse, or the clearing, booking or forwarding agent, or the person engaged in the business of transporting goods in the manner prescribed.

(b) The Prescribed Authority shall, in a case where the dealer or the person in-charge of goods as mentioned in clause (a) fails to produce any evidence or fails to satisfy the said authority regarding the proper accounting of goods, impose a penalty, after allowing an opportunity of hearing in the prescribed manner to the dealer or such person, which shall be equal to three times the amount of tax calculated on the value of such goods and the goods shall be released as soon as the penalty is paid.

(c) If the dealer or the person in-charge of the goods mentioned in clause (a) demands time for production of necessary documents in support of proper accounting, the authority referred to in clause (a) shall release the goods on the condition that the dealer or such person furnishes a security equivalent to three times the amount of tax calculated on the value of the goods, either in the form of cash, to be deposited in a Government treasury, or in the form of Bank guarantee or in such other form as acceptable to the authority.

(d) If the goods seized under clause (a) are not claimed by any person, the authority referred to in the said clause shall arrange for the safe custody of goods.

(e) In case the penalty imposed under clause (b) is not paid or the goods remain unclaimed for a period of thirty days or more from the date of seizure, the goods so seized shall be sold by auction in the prescribed manner and the sale proceeds shall be appropriated towards the amount of penalty imposed under clause (b); The balance of the sale-proceeds, if any, shall be deposited in the Government Treasury and shall be refunded to the lawful claimant in the prescribed manner:

Provided that in the case of goods of a perishable nature, the prescribed authority may decide to sell the goods by auction before a period of thirty days.

(f) In case where the goods have been released on furnishing of a security as mentioned in clause (c) and evidence regarding proper accounting of goods, to the satisfaction of the authority referred to in clause (a), is not produced within the date granted from the date on which the security is furnished, the amount of security shall stand forfeited to the State Government. If, however, evidence or document to the satisfaction of the authority mentioned in clause (a) regarding the proper accounting of goods is produced within the said date granted, the security shall be released in the prescribed manner.

(6)     (i) The power conferred under sub-Sections (3), (4) and (5) shall include the power to break open the lock of any box or receptacle or door of any other place or premises where any accounts, registers or other documents or goods may be kept or are reasonably suspected to be kept.

(ii) The powers conferred under sub-Sections (3), (4) and (5) shall also include the power to seal any box or receptacle, godown or building where any accounts, registers or other documents or goods may be kept or are reasonably suspected to be kept.

(7)     An authority appointed under Section 4, may require the assistance of any person, public servant or police officer in making a search and a seizure or for safe custody of goods seized under this Section, and such person, public servant or police officer shall render necessary assistance in the matter.

(8)     Where any books of accounts, other documents, money or goods are found in the possession or control of any person in the course of any search under sub-Section (2), (3) or (5), it shall be presumed, unless it is proved to the contrary, that such books of accounts, documents, money or goods belong to such person.

Explanation:- For the purposes of this Section the expression "proper accounting", shall-

(i)       in the case of a dealer, mean that the goods have either not been entered in the books of accounts or they have been classified in a manner which is likely to lead to evasion of tax payable under this Act; or

(ii)      in the case of the owner of a warehouse, or a clearing, booking or forwarding agent, or a person engaged in the business of transporting goods, mean properly entered in such registers and accounts as may be prescribed under sub-Section (2) of Section 73.

Section 71 - Survey

(1)     With a view to identify dealers who are liable to pay tax under the Act, but have remained unregistered, the prescribed authority shall from time to time cause a survey of unregistered dealers to be taken.

(2)     For the purpose of the survey, the prescribed authority may by general or special notice require any dealer or class of dealers to furnish the names, addresses and such other particulars as he may find necessary relating to the persons and dealers who have purchased any goods from or sold any goods to such dealer or class of dealers during any given period.

(3)     For the purposes of survey, the prescribed authority may call for details and particulars regarding the services provided by public utilities and financial institutions including banking companies, which he is of the opinion, will be relevant and useful for the purposes of the survey. He may from time to time cause the results of the survey to be published in any manner that he thinks fit so however as not to disclose or indicate the identity of any particular unregistered dealer identified during the survey.

(4)     The prescribed authority may for the purposes of the survey enter any place where a person is engaged in business but is unregistered or has not applied for grant of the certificate of registration, whether such place will be principal place of business or not of such business and require any proprietor, employee or any other person who may at that time and place be attending in any manner to, or helping in, the business;

(i)       to afford him the necessary facility to inspect such books of accounts or other documents as he may require and which may be available at such place,

(ii)      to afford him the necessary facility to check or verify the cash, stock or other valuable article or things which may be found 'there in, and

(iii)     to furnish such information as he may require as to any matter which may be useful for, or relevant to any proceedings under this Act.

Explanation -For the purposes of this sub Section, a place will also include any other place in which the person engaged in business or the employee or other person attending or helping in business stays and a place where any books of accounts or other documents or any part of the cash, stock or other valuable articles or things relating to the business are or is kept.

(5)     The prescribed authority shall enter the place where the person is carrying on business only during the hours at which such place is open for business and in case of any other place only after sunrise and before sunset. The prescribed authority may make or cause to be made extracts or copies from books of accounts and other documents inspected by him, make an inventory of any cash stock or other valuable articles or thing checked or verified by him, and record the statement of any person which may be useful for, or relevant to, any proceeding under this Act.