21. (1) No dealer shall, while being liable to pay tax under this Act, carry on business as a dealer unless he possesses a valid certificate of registration as provided by this Act:
Provided that the provisions of this sub-section shall not be deemed to have been contravened if the dealer having applied for such registration, as provided in this section, within the prescribed time carries on such business.
(2) A dealer dealing exclusively in goods specified in Schedule I shall not be liable for registration.
(3) Every dealer, required by sub-section (1) to possess a certificate of registration, shall apply in such form, to such authority and in such manner as may be prescribed.
(4) If the prescribed authority is satisfied that an application for registration is in order, it shall register the applicant and issue him a certificate of registration in the prescribed form.
(5) The prescribed authority may, after considering any information furnished under any provisions of this Act or otherwise received, amend from time to time, any certificate of registration.
(6) When a dealer has been subjected or is liable to be subjected to a penalty or is convicted in respect of contravention of the provisions of subsection (1), the prescribed authority shall register such dealer, if such dealer is not a registered dealer, and issue him a certificate of registration. Such registration shall take effect from the date of the issue of the certificate in every respect as if it had been issued under sub-section (3) on an application of the dealer.
(7) Where –
(a) any business, in respect of which a certificate of registration has been issued under this section, has been discontinued or, transferred, or
(b) total turnover and taxable turnover of a dealer during the preceding year has not exceeded the thresholds of turnover specified in sub-section (1) of section 3,- and the dealer applies in the prescribed manner for cancellation of his registration, the prescribed authority shall cancel the registration with effect from such date as it may fix in accordance with the rules.
(8) Where the Commissioner is satisfied that any business in respect of which a certificate of registration has been issued under this section, has been discontinued and the dealer has failed to apply as aforesaid for cancellation of registration, the Commissioner may, after giving the dealer a reasonable opportunity of being heard, cancel the registration with effect from such date as he may fix to be the date from which the business has been discontinued.
(9) The cancellation of a certificate of registration on an application of the dealer or otherwise, shall not affect the liability of the dealer to pay the tax, penalty or interest due for any period prior to the date of cancellation whether such tax, penalty or interest is assessed before the date of cancellation but remains unpaid, or is assessed thereafter.
22. (1) A dealer having a fixed or regular place of business in the State and who is not required to be registered under section 21, may apply in the prescribed manner for the certificate of registration to the authority prescribed for the purpose under section 21.
(2) If the prescribed authority is satisfied that the application made by the dealer under sub-section (1) is in order, it may grant him a
certificate of registration in the prescribed form:
Provided that no certificate of registration under this section shall be granted to the dealer unless he deposits an amount of rupees twenty-five thousand in the Government treasury. The dealer may, in his return to be furnished in accordance with section 29, adjust the amount so deposited against his liability to pay tax, penalty or interest payable under this Act.
(3) The provisions of sub-section (4) and clause (a) of sub-section (7) and sub-section (8) of section 21 shall apply in respect of the amendment or cancellation of certificate of registration granted under this section.
(4) Notwithstanding anything contained in this Act, every dealer who has been registered under sub-section (2) shall, so long as his registration remains in force, be liable to pay the tax under this Act.
23. Every dealer registered as on the appointed day under any of the earlier laws or under the Central Act shall be deemed to be registered under section 21.
Non transferability of registration.
24. Save as otherwise provided in section 25, a certificate of registration shall be personal to the dealer to whom it is granted and shall not be transferable.
Continuation of certificate of registration of dissolved firm.
25. Where, -
(a) a registered dealer is a firm and on the death of any partner of such firm, the firm stands dissolved, and
(b) the person who immediately before such dissolution was a partner of the firm carries on business of the dissolved firm, as proprietor, then-
(i) until the certificate of registration granted to the firm prior to its dissolution is amended under sub-clause (ii), the certificate of registration granted to the firm prior to its dissolution shall, subject to section 27, continue to be valid for a period of six months;
(ii) on an application made by such person within a period of six months from the date of dissolution of the firm for amendment of
the certificate of registration and on information being furnished in the manner required by section 26, the certificate of registration
granted to the firm prior to its dissolution shall be amended accordingly.
Amendment of certificate of registration.
26. (1) Where a registered dealer -
(a) transfers his business, in whole or in part, or transfers his place of business, by sale, lease, leave or license, hire or in any other manner whatsoever, or otherwise disposes of his business or any part thereof or effects or comes to know of any other change in the ownership of the business;
(b) discontinues his business or changes the place of business thereof or opens a new place of business, or temporarily closes the business for a period more than thirty days;
(c) changes the name, style, constitution or nature of his business; or
(d) enters into partnership or other association in regard to his business or effects any changes in the ownership of the business,
he shall, within the prescribed time inform the prescribed authority accordingly; and if any such dealer dies, his legal representative shall inform of such death or where any such dealer is a firm and there is any change in the constitution of the firm or the firm is dissolved, every person who was a partner thereof, shall in like manner, inform the said authority of the change in the constitution or as the case may be, dissolution of the firm.
(2) The Commissioner may, after considering any information furnished under this Act or otherwise received and after making such inquiry as he may deem fit, amend from time to time, any certificate of registration:
Provided that the Commissioner shall, before amending on his own motion a certificate of registration, give the dealer affected by such
amendment an opportunity of being heard.
(3) An amendment of the certificate of registration made under subsection (1) or (2) shall take effect from the date of contingency, which
necessitates the amendment, whether or not information in that behalf is furnished within the time prescribed under sub-section (1).
(4) Any amendment of a certificate of registration under this section
shall be without prejudice to any liability for tax, interest or penalty or for any
prosecution for an offence under this Act.
(5) If a dealer fails, without sufficient cause, to comply with the
provisions of sub-section (1), the Commissioner may after giving the dealer a
reasonable opportunity of being heard, direct him to pay, by way of penalty a
sum of rupees one hundred per day of default subject to a maximum of
rupees five thousand.
(6) For the removal of doubts, it is hereby declared that where a
registered dealer-
(a) effects a change in the name of his business;
(b) is a firm and there is a change in the constitution of the firm without
dissolution thereof;
(c) is a trustee of a trust and there is a change in the trustees thereof;
(d) is a Hindu Undivided Family and the business of such family is
converted into a partnership business with all or any of the coparceners
as partners thereof; or
(e) is a firm or a company or a trust or any other set up and change in the
management takes place including the change of the director or the
Managing Director of the company ;
then merely by reason of the circumstances as aforesaid, it shall not be
necessary for the dealer to apply for a fresh certificate of registration and on
information being furnished in the manner required by this section, the
certificate of registration shall be amended.
Cancellation of registration.
27. Where-
(a) any business, in respect of which a certificate of registration has
been issued to a dealer under this Act is discontinued;
(b) in the case of transfer of whole business by a dealer, the transferee
already holds a certificate of registration under this Act;
(c) an incorporated body has been wound up or it otherwise ceases to
exist;
(d) the owner of a proprietorship business dies leaving no successor to
carry on the business;
(e) in case of a firm or association of persons, it is dissolved; or
(f) a dealer has ceased to be liable to pay tax under this Act,-
the Commissioner may cancel the certificate of registration of such dealer or
the transferor, as the case may be, from such date, as may be specified by
him.
(2) A registered dealer, whose certificate of registration is liable to be
cancelled under sub-section (1), may apply for cancellation of his registration
to the prescribed authority, in the manner and within the time prescribed.
(3) On receipt of such application from the dealer, if the registering
authority is satisfied that the dealer fulfils the conditions specified in subsection
(1), he shall cancel the registration of such dealer.
(4) The certificate of registration shall be deemed to be inoperative-
(a) in case of clause (a) or (b) of sub-section (1), with effect from the
date of discontinuance or, as the case may be, transfer of the
business;
(b) in case of clause (c), (d), (e), or (f) of sub-section (1), from the date
on which the dealer's liability to pay tax has ceased,
notwithstanding the fact that the order of cancellation is passed or not or that
the particulars of the dealer regarding cancellation are published as required
under sub-section (11), or not.
(5) If a dealer –
(a) has failed to file three consecutive returns within the time prescribed
under this Act;
(b) knowingly furnishes incomplete or incorrect particulars in his returns;
(c) has failed to pay tax due from him under the provisions of this Act;
(d) having issued tax invoice or retail invoices, has failed to account for the
said invoices in his books of account;
(e) holds or accepts or furnishes or causes to be furnished a declaration,
which he knows or has reason to believe to be false;
(f) who has been required to furnish security under section 28, but has
failed to furnish such security;
(g) has been convicted of an offence under this Act, or under the earlier
law;
(h) discontinues his business and has failed to furnish information
regarding such discontinuation, or
(i) without entering into a transaction of sale issues to another dealer
tax invoice, retail invoice, bill or cash memorandum with the intention to
defraud the Government revenue,
the Commissioner may at any time, for reasons to be recorded in writing and
after giving the dealer an opportunity of being heard, cancel his certificate of
registration from such date as may be specified by him.
(6) Every person whose registration is cancelled under sub-section (5)
shall pay in respect of every taxable goods held as stock on the date of
cancellation an amount equal to the tax that would be payable in respect of
the goods if the goods were sold at fair market price on that date or the total
tax credit previously claimed in respect of such goods, whichever is higher.
(7) If an order of cancellation passed under this section is set aside as
a result of an appeal or other proceedings under this Act, the certificate of
registration of the dealer shall be restored and he shall deemed to be treated
as if his registration was not cancelled.
(8) Every dealer who applies for cancellation of registration shall
surrender with his application the certificate of registration granted to him and
every dealer whose registration is cancelled otherwise than on the basis of
his application shall surrender the certificate of registration within seven days
from the date of communication to him of the order of cancellation:
Provided that if a dealer is unable to surrender the certificate of
registration on account of loss, destruction or defacement of such certificate,
such dealer shall intimate the registering authority accordingly within seven
days from the date of communication of order of cancellation of registration.
(9) If a dealer –
(a) fails without sufficient cause to comply with the provisions of subsection
(2); or
(b) fails to surrender his certificate of registration as provided in sub-section
(8),
the Commissioner may, by an order in writing and after giving the dealer an
opportunity of being heard, direct that the dealer shall pay, by way of penalty,
a sum equal to rupees one hundred for every day of default.
(10) Cancellation of a certificate of registration shall not affect the
liability of any dealer to pay tax, penalty or interest due for any period till the
date of such cancellation and which has remained unpaid or is assessed
thereafter.
(11) The Commissioner shall publish in the manner as may be
prescribed the particulars of dealers whose certificate of registration has been
cancelled under the provisions of this Act.
Security from certain class of dealers.
28. (1) Where it appears necessary to the authority to which an
application is made under section 21 or 22 for issue of certificate of
registration, so to do for the proper realization of the tax, penalty and interest
payable under this Act, it may by an order in writing and for the reasons to be
recorded therein, impose as a condition for the issue of certificate of
registration a requirement that the dealer shall furnish in the prescribed
manner and within such time as may be specified in the order, such security
as may be specified in the order for the aforesaid purpose.
(2) Where it appears necessary to the authority referred to in section
21, or the Commissioner so to do for the proper realization of the tax, interest
and penalty payable or which has become due for payment, for any period of
any year, he may, at any time, by an order in writing and for reason to be
recorded therein, require a registered dealer to furnish in the prescribed
manner and within such time as may be specified in the order, such security
or if such dealer has already furnished any security, such additional security
as may be specified in the order.
(3) No dealer shall be required to furnish any security under subsection
(1) or any security or additional security under sub-section (2) unless
he has been given an opportunity of being heard.
(4) The amount of security, which a dealer may be required to furnish
under sub-section (1) or sub-section (2), or the aggregate of the amount of
such security, and the amount of additional security which he may be required
to furnish under sub-section (2) by the authority referred to therein or the
Commissioner, shall not exceed the amount of tax, interest and penalty
payable or which has become due for payment for a period of any year
according to the estimate of the authority referred to in sub-section (1) or
the Commissioner, on the turnover of sales or turnover of purchase of goods
of such dealer for any period of any year.
(5) Where the security furnished by a dealer under sub-section (1) or
sub-section (2) is in the form of a surety bond and the surety becomes
insolvent or dies, the dealer shall, within thirty days of the occurrence of any
of the aforesaid events, inform the authority referred to in sub-section (1) or
sub-section (2) or, as the case may be, the Commissioner and shall within
ninety days of such occurrence, furnish a fresh security for the same amount
as that of the bond in the form of a bond or in any other prescribed manner.
(6) The authority referred to in sub-section (1) or sub-section (2) or, as
the case may be, the Commissioner may, by order and for good and sufficient
cause, forfeit the whole or any part of the security furnished by a dealer for
realizing any amount of the tax, interest or penalty payable by the dealer:
Provided that no order shall be passed under this sub-section without
giving the dealer an opportunity of being heard.
(7) Where by reason of an order under sub-section (6), the security
furnished by any dealer is rendered insufficient, he shall make up the
deficiency in such manner and within such time as may be prescribed.
(8) The authority referred to in sub-section (1) or sub-section (2) or, as
the case may be, the Commissioner may, on an application made by a dealer
in that behalf, make an order of refund of any amount or part thereof
deposited by the dealer by way of security or for the release of bond under
this section, if it is not required for the purpose of realization of tax, interest or
penalty.
(9) Where a dealer fails to furnish security as required under subsection
(1), (2), (5) or (7), the authority referred to in section 21 shall refuse to
issue or, as the case may be, shall cancel the certificate of registration:
Provided that the refusal or cancellation of a certificate of registration
under this sub-section shall, notwithstanding anything contained in subsection
(3) of section 3, not affect the liability of the dealer to pay the tax,
penalty and interest due for any period before or after the date of such refusal
or cancellation of the certificate of registration; and accordingly the provisions
of this Act shall continue to apply.
