Condition and procedure for payment of tax at a compounded rate under
sub-section (4) of section 18.
39. (1) A registered dealer shall be eligible to exercise his option to pay tax under sub-section (4) of section 18 for a maximum period of one year only at a time:
Provided that such registered dealer can again exercise such option for subsequent years also subject to satisfaction of terms and conditions laid down in this rule.
(2) A registered dealer opting to pay tax under sub-section (4) of section 18 for a year shall not -
(a) have any goods in stock which were brought from outside the State on the day he exercises his option to pay tax by way of composition and shall not use any goods brought from outside the State in the execution of works contract, after such date;
(b) be a dealer who has claimed input tax credit on stock in hand of goods, as on the date on which he opts to pay tax under sub-section (4) of section 18;
(c) be a dealer involved in transfer of property in goods in the execution of works contract in the course of inter-State trade or commerce; and
(d) be a dealer who despatches his goods otherwise than by way of sale to outside or within the state for execution of works contract.
(3) A registered dealer may, in exercise of his option under sub-section (4) of section 18, pay tax for a year at the compounded rate of 2% of the aggregate amount received or receivable in respect of such works contract in lieu of tax payable for such year on his taxable contractual transfer price at the rates specified under sub-section (1) of section 18 in respect of the year.
(4) If a registered dealer intends to exercise his option to pay tax in accordance with the provisions of sub-section (4) of section 18, he shall make an application in Form No. 16 to the appropriate Additional Commissioner or the Deputy Commissioner duly authorised by the Commissioner for such purpose, for permission to do so within sixty days from the commencement of the year in respect of which option is exercised.
(5) If the concerned Additional Commissioner or the Deputy Commissioner, as the case may be, after making such enquiry as he deem necessary, is satisfied that the application is in order and fulfils conditions laid down in sub-section (4) of section 18, he shall grant permission within fifteen days from the date of receipt of such application to the applicant dealer for making payment at compounded rate for that year and inform. him in Form No. 17 accordingly.
(6) If the concerned Additional Commissioner or the Deputy Commissioner, as the case may be, after making such enquiry as he deems necessary, is of the opinion that the dealer is not entitled to pay tax under sub-section (4) of section 18, he shall give the dealer an opportunity of being heard, before rejecting his prayer under sub-rule (4).
(7) The concerned Additional Commissioner or the Deputy Commissioner, as the case may be, shall inform the dealer of his order under sub-rule (5) or sub-rule (6), as the case may be, within fifteen days from the date of such order.
(8) If the dealer to whom the permission has been granted under sub-rule (4) to pay tax at a compounded rate, fails to make payment of such tax for any two quarters of the year, the Additional Commissioner or the Deputy Commissioner, as the case may be, may, after giving such dealer an opportunity of being heard, withdraw the permission and such order of withdrawal will be effective from the first day of the quarter following the quarter or quarters for which he has defaulted to pay tax. |