Amendment status not verified — confirm the current text below against the official source.
Rates of tax on sales in the course of inter-State trade or commerce.— 2[(1) Every dealer, who in the course of inter-State trade or commerce, sells to a registered dealer goods of the description referred to in sub-section (3), shall be liable to pay tax under this Act, which shall be three percent, of his turnover or at the rate applicable to the sale or purchase of such goods inside the appropriate State under the sales tax law of that State, whichever is lower: Provided that the Central Government may, by notification in the Official Gazette, reduce the rate of tax under this sub-section. (2) The tax payable by any dealer on his turnover in so far as the turnover or any part thereof relates to the sale of goods in the course of inter-State trade or commerce not falling within sub- section (1), shall be at the rate applicable to the sale or purchase of such goods inside the appropriate State under the sales tax law of that State. Explanation— For the purposes of this sub-section, a dealer shall be deemed to be a dealer liable to pay tax under the sales tax law of the appropriate State, notwithstanding that he, in fact, may not be so liable under that law.]; (2A) 3[***] (3) 4[The goods referred to in sub-section (1)] (a) 5[***] (b) 6[***] are goods of the class or classes specified in the certificate of registration of the registered dealer purchasing the goods as being intended for re-sale by him or subject to any rules made by the Central Government in this behalf, for use by him in the manufacture or processing of goods for sale or 7[in the tele-communications network or] in mining or in the generation or distribution of electricity or any other form of power; (c) are containers or other materials specified in the certificate of registration of the registered dealer purchasing the goods, being containers or materials intended for being used for the packing of goods for sale; (d) are containers or other materials used for the packing of any goods or classes of goods specified in the certificate of registration referred to in 8[***] clause (b) or for the packing of any containers or other materials specified in the certificate of registration referred to in clause (c). 9[(4) The provisions of sub-section (1) shall not apply to any sale in the course of inter-State trade or commerce unless the dealer selling the goods furnishes to the prescribed authority in the 1 Subs. by Act 31 of 1958 sec. 5, for sub-section (1) to (4) (w.e.f. 1-10-1958) 2 Sub Section (1) and (2) substituted by the Taxation Laws (Amendment) Act, 2007. 3 Sub-section (2A) omitted by Act 20 of 2002, sec. 152 (w.e.f. 11-5-2002). 4 Substituted by the Taxation Laws (Amendment) Act, 2007, S.4(6). 5 Clause (a) omitted by Act 8 of 1963, sec. 2 6 Certain words omitted by Act 8 of 1963, sec. 2 7 Ins. by Act 20 of 2002, sec. 152 8 The words "clause (a) or" omitted by Act 8 of 1963, sec. 2 (w.e.f. 1-4-1963). 9 Sub Section (4) Substituted by the Taxation Laws (Amendment) Act, 2007. The Central Sales Tax Act, 1956 Page 9 of 20 prescribed manner a declaration duly filled and signed by the registered dealer to whom the goods are sold containing the prescribed particulars in a prescribed form obtained from the prescribed authority: Provided that the declaration is furnished within the prescribed time or within such further time as that authority may, for sufficient cause, permit.] 1[(5) Notwithstanding anything contained in this section, the State Government may 2[on the fulfillment of the requirements laid down in sub- section (4) by the dealer] if it is satisfied that it is necessary so to do in the public interest, by notification in the Official Gazette and subject to such conditions as may be specified therein direct,— (a) that no tax under this Act shall be payable by any dealer having his place of business in the State in respect of the sales by him, in the course of inter-State trade or commerce, 3[to a registered dealer 4[***]] from any such place of business of any such goods or classes of goods as may be specified in the notification, or that the tax on such sales shall be calculated at such lower rates than those specified in sub-section (1) 5[***] as may be mentioned in the notification; (b) that in respect of all sales of goods or sales of such classes of goods as may be specified in the notification, which are made, in the course of inter-State trade or commerce 6[to a registered dealer 7[***]] by any dealer having his place of business in the State or by any class of such dealers as may be specified in the notification to any person or to such class of persons as may be specified in the notification, no tax under this Act shall be payable or the tax on such sales shall be calculated at such lower rates than those specified in sub- section (1) 8[***] as may be mentioned in the notification.] 9[(6) Notwithstanding anything contained in this section, no tax under this Act shall be payable by any dealer in respect of sale of any goods made by such dealer, in the course of inter-State trade or commerce to a registered dealer for the purpose of setting up, operation, maintenance, manufacture, trading, production, processing, assembling, repairing, reconditioning, re- engineering, packaging or for use as packing material or packing accessories in a unit located in any special economic zone or for development, operation and maintenance of special economic zone by the developer of the special economic zone, if such registered dealer has been authorised to establish such unit or to develop, operate and maintain such special economic zone by the authority specified by the Central Government in this behalf.] (7) The goods referred to in sub-section (6) shall be the goods of such class or classes of goods as specified in the certificate of registration of the registered dealer referred to in that sub-section. (8) The provisions of sub-sections (6) and (7) shall not apply to any sale of goods made in the course of inter-State trade or commerce unless the dealer selling such goods furnishes to the 10[prescribed authority referred to in sub section (4) a declaration in the prescribed manner on the prescribed form obtained from the authority specified by the Central Government under sub- Explanation— For the purposes of sub-section (6), the expression "special economic zone" has the meaning assigned to it in clause (iii) to Explanation 2 to the proviso to section 3 of the Central Excise Act, 1944 (1 of 1944).] 11[(8A) Determination of turnover.— (1) In determining the turnover of a dealer for the purpose of this Act, the following deductions shall be made from the aggregate of the sale prices, namely:— (a) the amount arrived at by applying the following formula— rate of tax x aggregate of sale Prices _ 100 + rate of tax 1 Subs. by Act 61 of 1972, sec. 5, for sub-section (5) (w.e.f. 1-4-1973). 2 Subs. by Act 61 of 1972, sec. 5, for sub-section (5) (w.e.f. 1-4-1973). 3 Ins. By Act 20 of 2002, S.152 4 Omitted by the Taxation Laws (Amendment) Act, 2007, S.4(d). 5 Omitted by the Taxation Laws (Amendment) Act, 2007, S.4(d). 6 Ins. By Act 20 of 2002, S.152 7 Omitted by the Taxation Laws (Amendment) Act, 2007, S.4(d). 8 Omitted by the Taxation Laws (Amendment) Act, 2007, S.4(d). 9 Subs. by Act 23 of 2004 10 Subs. by Act 23 of 2004 11 Ins. By Act 28 of 1969 S.5 (retrospectively) The Central Sales Tax Act, 1956 Page 10 of 20 Provided that no deduction on the basis of the above formula shall be made if the amount by way of tax collected by a registered dealer, in accordance with the provisions of this Act, has been otherwise deducted from the aggregate of sale prices. Explanation— Where the turnover of a dealer is taxable at different rates, the aforesaid formula shall be applied separately in respect of each part of the turnover liable to a different rate of tax; (b) the sale price of all goods returned to the dealer by the purchasers of such goods,— (i) within a period of three months from the date of delivery of the goods, in the case of goods returned before the 14th day of May, 1966; (ii) within a period of six months from the date of delivery of the goods, in the case of goods returned on or after the 14th day of May, 1966: Provided that satisfactory evidence of such return of goods and of refund or adjustment in accounts of the sale price thereof is produced before the authority competent to assess or, as the case may be, reassess the tax payable by the dealer under this Act; and (c) such other deductions as the Central Government may, having regard to the prevalent market conditions, facility of trade and interests of consumers, prescribe. (2) Save as otherwise provided in sub-section (1), in determining the turnover of a dealer for the purposes of this Act, no deduction shall be made from the aggregate of the sale prices.] 1[2[9. Levy and collection of tax and penalties.— (1) The tax payable by any dealer under this Act on sales of goods effected by him in the course of inter-State trade or commerce, whether such sales fall within clause (a) or clause (b) of section 3, shall be levied by the Government of India and the tax so levied shall be collected by that Government in accordance with the provision of sub-section (2), in the State from which the movement of the goods commenced: 3[Provided that, in the case of a sale of goods during their movement from one State to another, being a sale subsequent to the first sale in respect of the same goods and being also a sale which does not fall within sub-section (2) of section 6, the tax shall be levied and collected— (a) where such subsequent sale has been effected by a registered dealer, in the State from which the registered dealer obtained or, as the case may be, could have obtained, the form prescribed for the purposes of 4[sub-section (4) of section 8] in connection with the purchase of such goods; and (b) where such subsequent sale has been effected by an unregistered dealer in the State from which such subsequent sale has been effected.] (2) Subject to the other provisions of this Act and the rules made thereunder, the authorities for the time being empowered to assess, re-assess, collect and enforce payment of any tax under general sales tax law of the appropriate State shall, on behalf of the Government of India, assess re-assess, collect and enforce payment of tax, including any 5[interest or penalty,] payable by a dealer under this Act as if the tax or 6[interest or penalty] payable by such a dealer under this Act is a tax or 7[interest or penalty] payable under the general sales tax law of the State; and for this purpose they may exercise all or any of the powers they have under the general sales tax law of the State; and the provisions of such law, including provisions relating to returns, provisional assessment, advance payment of tax, registration of the transferee of any business, imposition of the tax liability of a person carrying on business on the transferee of, or successor to, such business, transfer of liability of any firm or Hindu undivided family to pay tax in the event of the dissolution of such firm or partition of such family, recovery of tax from third parties, appeals, reviews, revisions, references, 8[refunds, rebates, penalties,] 9[charging or payment of interest,] compounding of offences and treatment of documents furnished by a 1 Section 9 subs. by Act 31 of 1958, sec. 6 2 Section 9 again subs. by Act 28 of 1969, sec. 6 (retrospectively). 3 Subs. by Act 103 of. 1976, sec. 6, for the proviso (w.e.f. 7-9-1976). 4 Omitted by the Taxation Laws (Amendment) Act, 2007, S.5. 5 Subs. by Act 10 of 2000, sec. 119, for "including any penalty" (w.e.f. 12-5-2000) 6 Subs. by Act 10 of 2000, sec. 119, for "including any penalty" (w.e.f. 12-5-2000) 7 Subs. by Act 10 of 2000, sec. 119, for "including any penalty" (w.e.f. 12-5-2000) 8 Subs. by Act 61 of 1972, sec. 6, for "refunds, penalties" (w.e.f. 1-4-1973). 9 Ins. by Act 103 of 1976, sec. 6 (retrospectively). The Central Sales Tax Act, 1956 Page 11 of 20 dealer as confidential, shall apply accordingly: Provided that if in any State or part thereof there is no general sales tax law in force, the Central Government may, be rules made in this behalf make necessary provision for all or any of the matter specified in this sub-section. 1[(2A) All the 2[provisions relating to offences, interest and penalties] (including provisions relating to penalties in lieu of prosecution for an offence or in addition to the penalties or punishment for an offence but excluding the provisions relating to matters provided for in section 10 and 10A) of the general sales tax law of each State shall, with necessary modifications, apply in relation to the assessment, re-assessment, collection and the enforcement of payment of any tax required to be collected under this Act in such State or in relation to any process connected with such assessment, re-assessment, collection or enforcement of payment as if the tax under this Act were a tax under such sales tax law.] 3[(2B) If the tax payable by any dealer under this Act is not paid in time, the dealer shall be liable to pay interest for delayed payment of such tax and all the provisions for delayed payment of such tax and all the provisions relating to due date for payment of tax, rate of interest for delayed payment of tax, of the general sales tax law of each State, shall apply in relation to due date for payment of tax, rate of interest for delayed payment of tax, and assessment and collection of interest for delayed payment of tax under this Act in such States as if the tax and the interest payable under this Act were a tax and an interest under such sales tax law.] (3) The proceeds in any financial year of any tax, 4[including any interest or penalty] levied and collected under this Act in any State (other than a Union Territory) on behalf of the Government of India shall be assigned to the State and shall be retained by it; and the proceeds attributable to Union territories shall form part of the Consolidated Fund of India.] 5[9A. Collection of tax to be only by registered dealers.— No person who is not a registered dealer shall collect in respect of any sale by him of goods in the course of inter-State trade or commerce any amount by way of tax under this Act, and no registered dealer shall make any such collection except in accordance with this Act and the rules made thereunder.] 6[9B. Rounding off of tax, etc.— The amount of tax, penalty, fine or any other sum payable, and the amount of refund due, under the provisions of this Act shall be rounded off to the nearest rupees and, for the purpose, where such amount contains a part of a rupee consisting of paise, 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: Provided that nothing in this section shall apply for the purpose of collection by a dealer of any amount by way of tax under this Act in respect of any sale by him of goods in the course of inter-State trade or commerce.]