Chapter III Chapter III

1. (1) Notwithstanding anything contained in section 14, every proprietor liable to pay tax under this Act, shall furnish to the assessing authority, within a period of sixty days of the expiry of the year, a return in such form as may be prescribed.
2. (2) Before any proprietor furnishes any return under sub-section (1), he shall pay in advance the full amount of tax payable by him on the basis of such return as reduced by any tax already paid under section 14 and shall furnish along with the return satisfactory proof of the payment of such tax in such manner as may be prescribed and a return without such proof of payment shall not be deemed to have been filed. After the final assessment is made, the amount of tax so paid shall be deemed to have been paid towards the tax finally assessed.
3. (3) Every return shall be verified in such manner as may be prescribed.

1. (1) Every proprietor liable to pay tax under this Act shall furnish to the assessing authority within a period of fifteen days of the expiry of a month, a statement in such form as may be prescribed showing therein the whole amount of tax due from him according to such statement.
2. (2) Every statement under sub-section
3. (1) shall be accompanied by a treasury challan in proof of payment of the full amount of tax due according to the statement, and a statement without such proof of payment shall not be deemed to have been duly filed and the amount so payable shall for the purposes of section 19 and section 21 be deemed to be tax due from such proprietor.
4. (3) If a default is committed in the payment of tax in any month beyond ten days whether or not a statement as required under sub-section
5. (1) is filed; or if the amount of tax paid is less than the amount of tax payable for any month, the proprietor defaulting payment of tax or making less-payment of tax shall, in addition to the tax, pay interest calculated at the rate of two per cent per month or part thereof from the date of such default or less payment to the date of payment of such tax.
6. (4) If no such statement is submitted by any proprietor under sub-section
7. (1) before the date specified therein or if the statement submitted by him appears to the assessing authority to be incorrect or incomplete, the assessing authority may assess the proprietor provisionally for that month to the best of its judgment, recording the reasons for such assessment and proceed to demand and collect the tax on the basis of such assessment:

Assessment and cancellation of registration

1. (1) If the assessing authority is satisfied that the return furnished under sub-section
2. (1) of section 13 is complete and it has no reason to believe that it is incorrect, it shall assess the amount of tax due from the proprietor. (2)
   • (a) If the assessing authority is not satisfied that the return furnished under sub-section
3. (1) of section 13 is complete or it has reason to believe that it is incorrect and it considers it necessary to require the presence of the proprietor or the production of further evidence, it shall, within a period of three years from the date of furnishing of such return, serve on such proprietor a notice in such manner as may be prescribed, requiring him on a date and at a place specified therein either to attend and produce or cause to be produced all evidence on which such proprietor relies in support of his return or to produce such evidence as specified in the notice.
   • (b) On the date specified in the notice, or as soon as may be thereafter, the assessing authority shall, after considering all the evidence which may be produced, assess the amount of tax due from the proprietor.
   • (c) If the proprietor fails to comply with the terms of the notice issued to him under clause (a), the assessing authority at any time thereafter may, assess to the best of its judgment, the amount of tax due from him.
4. (3) If a proprietor liable to pay tax, fails to furnish a return in respect of any period within the period specified in sub-section
5. (1) of section 13, the assessing authority shall, within a period of three years after the expiry of such period, assess to the best of its judgment, the amount of tax, if any, due from him: Provided that the proprietor shall be afforded a reasonable opportunity of being heard by the assessing authority before such assessment is made.
6. (4) Any assessment made under this section shall be without prejudice to any penalty or interest that may be imposed under any other provisions of this Act.

1. (1) Where for any reason the whole or any part of the charges for luxury provided in a hotel or charges for luxury provided in a banquet hall has escaped assessment to tax or has been assessed at a rate lower than the rate at which it is assessable, the assessing authority may, within a period of three years from the expiry of the period to which the tax relates, proceed to assess or reassess to the best of its judgment the tax due from the proprietor.
2. (2) In making an assessment under sub-section (1), the assessing authority may, if it is satisfied that the tax escaped from assessment is due to willful non-disclosure of the charges for luxury by the proprietor, after giving a reasonable opportunity of showing cause, direct the proprietor to pay, in addition to the tax assessed under sub-section (1), a penalty twice the tax so assessed.

If upon information, the assessing authority is satisfied that any proprietor of a hotel or banquet hall is liable to pay tax in respect of any period but has failed to apply for registration, the assessing authority shall, within three years after the expiry of such period, after giving such proprietor a reasonable opportunity of being heard, proceed to assess, to the best of its judgment, the amount of tax, if any, due from the proprietor in respect of such period and all subsequent periods and in case where such proprietor has willfully failed to apply for registration, the assessing authority may direct that the proprietor shall pay by way of penalty, in addition to the amount of tax so assessed, a sum equal to twice the amount of tax so assessed. Explanation.– For the purposes of this section a proprietor shall be deemed to have failed to apply for registration, if he makes an incomplete application for registration or, having made an application for registration, fails to comply with any direction given to him by the assessing authority within the time specified including direction to furnish security under sub-section

1. (3) of section 11.

1. (1) A proprietor who is not registered under this Act, shall not collect any amount by way of tax or purporting to be by way of tax nor shall a registered proprietor collect any amount by way of tax or purporting to be by way of tax at a rate exceeding the rate specified under this Act at which he is liable to pay tax.
2. (2) If any proprietor contravenes the provisions of sub-section (1), the assessing authority, after giving such proprietor a reasonable opportunity of being heard shall, by order in writing, forfeit in favour of the State Government the amount unauthorizedly collected or collected in excess of the specified rate and may, in addition, by order in writing, impose upon him by way of penalty, a sum not exceeding one and a half times the amount so collected.

Where any proprietor liable to pay tax—

1. (a) fails without sufficient cause to furnish a return as required by sub-section

1. (1) of section 13; or
   • (b) fails to pay the tax due along with the return in accordance with the provisions of sub-section
2. (2) of section 13; or
   • (c) fails to pay interest or penalty as determined under this Act; the assessing authority may, after giving the proprietor a reasonable opportunity of being heard, direct him to pay, in addition to the tax, interest or penalty, if any, a penalty not exceeding one and a half times the amount of tax, interest or penalty, as the case may be.

1. (1) Any tax, interest or penalty payable under this Act shall, notwithstanding anything contained in any law for the time being in force, be recoverable as an arrear of land revenue and the assessing authority shall have all the powers of a collector for the purpose of such recovery.
2. (2) When the assessing authority makes an order of assessment or imposes penalty, it shall issue a notice of demand in such form as may be prescribed, specifying the amount of tax, interest or penalty payable and the date or dates on which the tax, interest or penalty shall be paid:
   • (i) the amount of tax, interest or penalty specified in the notice of demand shall be payable within the period and in the manner specified in such notice and if not so paid, the tax, interest or penalty shall be deemed to be immediately due and shall be a charge on the properties of the proprietor liable to pay such tax, interest or penalty; and
   • (ii) the proprietor liable to pay such tax, or penalty, shall be liable to pay simple interest at the rate of two per cent of the amount of the tax or penalty due for each month or part thereof for the period for which the tax or penalty remains unpaid.
3. (3) Any tax, interest, or penalty which remains unpaid on the date specified in the notice of payment shall be recoverable,—
   • (a) by attachment and sale or by sale without attachment of any property of such proprietor; or
   • (b) from certain other persons by the assessing authority in such manner as may be prescribed.

1. (1) The assessing authority may, at any time or from time to time, by notice in writing, (a copy of which shall be forwarded to the proprietor at his last address known to the assessing authority), require any person from whom money is due to the proprietor or any person who holds or may subsequently hold money for or on account of the proprietor, to pay to the assessing authority either forthwith upon the money becoming due or being held at or within the time specified in the notice (not being before the money becomes due or is held) so much of the money as is sufficient to pay the amount due by the proprietor in respect of arrears of tax, interest, or penalty or the whole of the money when it is equal to or less than that amount.
2. (2) The assessing authority may at any time or from time to time, amend or revoke any such notice or extend the time for making any payment in pursuance of such notice.
3. (3) Any person making any payment in compliance with the notice under this section shall be deemed to have made the payment under the authority of the proprietor and the receipt of the assessing authority shall constitute a good and sufficient proof of discharge of the liability of such person to the extent of the amount referred to in the receipt.
4. (4) Any person discharging any liability to the proprietor after receipt of the notice referred to in this section shall be personally liable to the assessing authority to the extent of the liability discharged or to the extent of the liability of the proprietor for the amount due under this Act, whichever is less.
5. (5) Where any person to whom a notice under this section is sent, objects to it on the ground that the sum demanded or any part thereof is not due by him to the proprietor or that he does not hold any money for or on account of the proprietor, then nothing contained in this section shall be deemed to require such person to pay the sum demanded or any part thereof to the assessing authority.
6. (6) Any amount which a person is required to pay to the assessing authority or for which he is personally liable to the assessing authority under this section shall, if it remains unpaid be a charge on the properties of the said person and may be recovered in the manner specified in section 21. Explanation.– For the purposes of this section, the amount due to proprietor or money held for or on account of proprietor shall be computed after taking into account such claims, if any, as may have fallen due for payment by such proprietor to such person and as may be lawfully subsisting.

1. (1) Where any firm is liable to pay any tax, interest, penalty or any other amount under this Act, the firm and each of the partners of the firm shall be jointly and severally liable for such payment.
2. (2) Where a partner of a firm liable to pay any tax, interest, penalty or other amount under this Act retires, he shall, notwithstanding any contract to the contrary, be liable to pay the tax or penalty or other amount remaining unpaid at the time of his retirement and any tax, interest, penalty or other amount upon the date of retirement, though unassessed.
3. (3) when a firm liable to pay the tax or penalty under this Act is dissolved or discontinued, the assessment of the tax, calculation of interest and imposition of penalty shall be made as if no dissolution or discontinuance of the firm had taken place and every person who was, at the time of dissolution or discontinuance, a partner of the firm and the legal representative of any such person who is deceased, shall be jointly and severally liable to pay the tax assessed, interest calculated or penalty imposed.

If any proprietor liable to pay tax —

1. (a) sells, transfers or otherwise disposes of or discontinues his business; or
2. (b) sells, transfers or otherwise disposes of or discontinues his place of business; or opens new place of business; or
3. (c) changes the name, constitution or nature of the business; he shall within such time as may be prescribed, inform the assessing authority, and if any proprietor dies, his legal representative shall in like manner inform the said authority: Provided that if a proprietor or the legal representative, as the case may be, fails to inform the said authority of the foregoing provision having the effect of transferring the liability to pay tax on another person, then, notwithstanding the change, any tax which such person has become liable to pay after the change has taken place, may be recovered as if no change has taken place:

Tax payable on transfer of business

1. (1) When the ownership of the business of a proprietor liable to pay tax is transferred, the transferor and the transferee shall jointly and severally be liable to pay the tax, interest, penalty or any other amount due under this Act in respect of such business which remains unpaid at the time of transfer and for the purpose of recovery from the transferee, such transferee shall be deemed to be the proprietor liable to pay the tax.
2. (2) Where a proprietor dies, his executor, administrator or other legal representative shall be deemed to be the proprietor, for the purposes of this Act, and the provisions of this Act shall apply to him in respect of the business of the deceased proprietor: Provided that in respect of any tax or penalty assessed as payable by any such proprietor or any tax, interest or penalty which would have been payable by him under this Act, if he had not died, all executor, administrator or other legal representative shall be liable only to the extent of the assets of the deceased in his hands.
3. (3) When an undivided Hindu family liable to pay tax or penalty or other amount under this Act is partitioned, the assessment of the tax, interest and the imposition of penalty shall be made as if no partition of the family has taken place, and every person who was a member of the family before the partition shall be jointly and severally liable to pay the tax assessed, interest calculated or penalty imposed.

1. (1) Every registered proprietor, and every proprietor liable to get himself registered under this Act shall maintain and keep true and complete accounts relating to his business as well as such other registers or records as may be prescribed. All such accounts, registers or records shall be retained by the proprietor until the assessment, appeal, revision or other proceedings in respect of such year have been concluded and if any proceedings in respect of such year have been initiated or are pending, the same is disposed of.
2. (2) Every proprietor liable to pay tax shall issue a bill or cash memorandum in respect of the charges for lodging accommodation or charges for banquet hall recovered by him from a guest or any person and shall specify in such bill or cash memorandum, the full name of the hotel or banquet hall, the amount of tax recovered, the name of the guest or any person from whom it is recovered and where the charges are recovered in any foreign exchange, the name of the currency.

All authorities under this Act, shall for the purpose of this Act, have the same powers as are vested in a court under the Code of Civil Procedure, 1908 (Act V of 1908), while trying a suit, in respect of enforcing the attendance of and examining any person on oath or affirmation or for compelling the production of any document.

All officers appointed under sub-section

1. (1) of section 3 or an assessing authority may, for carrying out the purposes of this Act, require any person including a banking company, insurance company, electricity supply and distribution company, courier service company, post office, railway, a State Government corporation, or a State Government agency or body regulating any trade, tourism or commerce, or any officer thereof, to furnish any information, data or statistics which may be relevant to any proceedings or useful for tax administration.

An assessing authority shall, for the purposes of this Act, have the power to determine as to who is the real proprietor of luxuries being provided in the precincts of a hotel at any place outside the room or inside a banquet hall:

Power of inspection of accounts, documents and search

1. (1) The assessing authority or any officer authorized by the State Government in this behalf may, subject to such conditions as may be prescribed, require any proprietor to produce before it the working records of accounts, registers or other documents or to furnish any information relating to his business as may be necessary for the purposes of this Act.
2. (2) All working records of accounts, registers or other documents referring to the business of any hotel, lodging house, health club, beauty parlour, swimming pool, conference hall and the like and banquet hall shall at all reasonable times be open to inspection by the assessing authority or the authorized officer and the assessing authority or the authorized officer may take or cause to be taken such copies or extracts of such records as may be necessary for the purpose of testing the accuracy of the charges for such luxury or for informing itself as to any particulars regarding which information is required for the purpose of this Act or any rules made thereunder as would appear to it necessary.
3. (3) If the assessing authority has reason to believe that any proprietor has evaded or is attempting to evade the payment of tax due from him, it may, for reasons to be recorded in writing, seize such records of accounts, registers or other documents of the proprietor as may be necessary and shall grant a receipt in respect of the same and shall retain the same so long as it may be necessary in connection with any proceeding under this Act: Provided that, accounts, registers, records and other documents so seized shall not be retained by such authority for a period exceeding one hundred eighty days from the date of seizure, unless the reasons for retaining the same beyond the said period are recorded by it, in writing and the approval of the next higher authority is obtained and such approval in any case shall not be for more than sixty days at a time.
4. (4) For the purposes of this Act, the assessing authority or the person authorized by it in this behalf or authorized officer under this sub-section, may enter and search the hotel or banquet hall or any place of business of the proprietor or any other place where the assessing authority or the officer authorized has reason to believe that the proprietor keeps, or is for the time being keeping, any records of accounts, registers or other documents relating to his business.