Chapter IV Chapter IV

(1) Every registration and grant of licenses dealer whose total turnover in any year is not less than 1. Substituted by Act 9 of 1964 w.e.f. 1.4.1964. 2. Substituted by Act 4 of 1992 w.e.f. 1.10.1991 2[two lakh] rupees shall, and any other dealer may, get himself registered under this Act: 1[Provided that every 2[x x x] manufacturer, 3[x x x] or dealer who brings 1. Inserted by Act 4 of 1992 w.e.f. 1.4.1992. 2. Omitted by Act 6 of 1995 w.e.f. 1.4.1995. 3. Omitted by Act 7 of 1997 w.e.f. 1.4.1997. any goods into the State or to whom any goods are despatched from any place outside the State shall get himself registered under this Act, if his total turnover is not less than one lakh rupees in any year;] (2) Not withstanding anything contained in sub-section (1),— (i) every casual trader 1[x x x] ; (ii) every dealer registered under the Central Sales Tax Act, 1956 (Central Act 74 of 1956); (iii) every dealer residing outside the State but carrying on business in the State; 1[(iii-a) every dealer in liquor and/or beer and every dealer in jewellery;] 1. Omitted by Act 8 of 1984 w.e.f. 1.4.1984. 1. Inserted by Act 7 of 1997 w.e.f. 1.4.1997. Sales Tax [1957: KAR. ACT 25 (iv) every manager or agent of a non-resident dealer; and (v) every commission agent, broker, del credere agent, auctioneer or any other mercantile agent, by whatever name called, who carries on the business of buying, selling, supplying or distributing goods on behalf of any principal, shall get himself registered under this Act, irrespective of the quantum of his total turnover in such goods. 1[(3) Every miller whether he is a dealer or not shall get himself registered under this Act.] 1[(4) Nothing contained in this section shall apply to any State Government or the Central Government] 2[or a statutory body or a local authority except when they buy, sell, supply or distribute goods directly or otherwise for cash or deferred payment or for commission or remuneration or other valuable consideration in the course of business.] 1[(5) Nothing in this section shall apply to any dealer registered under the Karnataka Value Added Tax Act, 2003 and who is not a dealer in petrol, diesel, aviation turbine fuel, lottery tickets and sugarcane.] 10-A. Procedure for registration.- (1) An application for registration under section 10 shall be made to such authority, in such manner and within such period as may be prescribed and shall be accompanied by a fee of 1[five hundred rupees.] 1. Inserted by Act 9 of 1970 w.e.f. 1.4.1970. 1. Inserted by Act 23 of 1983 w.e.f. 1.4.1976. 2. Inserted by Act 4 of 1992 w.e.f. 1.4.1992. 1. Inserted by Act 7 of 2003 w.e.f. 1.4.2003. 1. Substituted by Act 7 of 1997 w.e.f. 1.4.1997. (2) If the prescribed authority after making such enquiries as it may consider necessary is satisfied that the application is in order and that the particulars furnished therein are correct, it shall register the applicant and issue to him a certificate in the prescribed form. 1[Provided that the applicant shall be deemed to be registered if the prescribed authority does not reject the application submitted within a period of thirty days from the date of submission of such application.] (3) Where a dealer has more than one place of business, the registration certificate shall cover all such places of business. The prescribed authority shall issue copies of the registration certificate to the dealer for exhibition at each of his places of business and the dealer shall pay a fee of 1[five hundred rupees] for each copy. 1[(4) 2[(a) The prescribed authority shall for good and sufficient reasons demand from any dealer who is registered or has applied for 1957: KAR. ACT 25] Sales Tax registration under sub-section (1) or has applied for renewal of registration under this Act, security for proper payment of tax by him or for the proper custody and use of the forms referred to in 3[section 5-A , proviso to sub- section (2) of section 6-A and sub-section (2) of section 28-A or any of these provisions] and on such demand such dealer shall furnish the same.] 1[Provided that in the case of different categories of dealers in liquor and/or beer, the prescribed authority shall demand security, for proper payment of tax as the State Government may fix from time to time by notification.] (b) The amount of security payable under clause (a) shall not exceed,— (i) in the case of dealers who have opted to pay tax under section 17, an amount equivalent to three months compounded rate fixed for that year, and (ii) in other cases, an amount equivalent to one-half of the tax anticipated to be payable by the dealer for that year: Provided that the assessing authority shall have power to demand at any time additional security if such authority has reason to believe that the security fixed was too low. (c) The security paid under this sub-section in any year shall be maintained in full until it is dispensed with by the assessing authority on being satisfied that the reasons for its demand no longer exist or until the registration certificate is cancelled, whichever is earlier.] 1[(d) The assessing authority may by order and for good and sufficient cause forfeit the whole or any part of the security furnished by a dealer,— (i) for realising any amount of tax or penalty payable by the dealer; (ii) if the dealer is found to have mis-used any of 2[the forms referred to in clause (a) or to] have failed to keep them in proper custody: Provided that no order shall be passed under this clause without giving the dealer an opportunity of being heard; (e) The assessing authority issuing the forms referred to in clause (a) may refuse to issue such forms to a dealer who has failed to comply with a demand under that clause or under clause (b), until the dealer has complied with such demand.] 2. By Errata No. 525 Karnataka Gazette (Extraordinary) dated 5.9.1988. 1. Inserted by Act 26 of 2004 w.e.f. 1.8.2004. 1. Substituted by Act 7 of 1997 w.e.f. 1.4.1997. 1. Substituted by Act 9 of 1970 w.e.f. 1.4.1970. 2. Substituted by Act 27 of 1985 w.e.f. 1.8.1985. 3. Substituted by Act 3 of 1998 w.e.f. 1.4.1998. 1. Inserted by Act 7 of 1997 w.e.f. 1.4.1997. 1. Inserted by Act 15 of 1988 w.e.f. 1.4.1988. Sales Tax [1957: KAR. ACT 25 1[(5) A certificate issued under sub-section (2) shall be renewed from year to year on payment of the fee specified in sub-section (1) until it is cancelled.] 1. Substituted by Act 23 of 1983 w.e.f. 18.11.1983. (6) A dealer registered under sub-section (1) of section 10 shall be entitled to have his registration cancelled if he is able to prove to the satisfaction of the prescribed authority that his turnover in each of the two consecutive years immediately preceding the application was less than the limit mentioned in the said sub-section. (7) The prescribed authority shall have power, for good and sufficient reasons, to cancel, modify or amend any registration certificate issued by it. (8) No application for registration and no renewal under this section shall be refused and no order under sub-section (4) or sub-section (7) shall be made, unless the dealer concerned has been given a reasonable opportunity of being heard. (9) When a dealer has ceased to do business in any year and gives notice of that fact to the prescribed authority, he shall not be liable to pay any registration fee from the commencement of the following year unless he resumes business. (10) The dealer shall exhibit the certificate of registration granted under subsection (1) at the place of business mentioned in the certificate. Where the dealer has more than one place of business, he shall exhibit the certificate of registration at the principal place of business mentioned in the certificate and a copy of such certificate granted under sub-section (3) at every other place of business within the State mentioned in the certificate.] 1[(11) No dealer who is registered under the Karnataka Value Added Tax Act, 2003, shall be required to pay registration or renewal fee under this Act.] 1. Inserted by Act 7 of 2003 w.e.f. 1.4.2003. 1[10-B. Suo motu registration.- Any person who is liable to get 1. Inserted by Act 18 of 1999 w.e.f. 1.4.1999. himself registered under this Act fails to do so, the prescribed authority may after conducting such survey, inspection or inquiry as may be prescribed, proceed to register such person under the Act and the provisions of section 10-A shall apply mutatis mutandis.]

¹ Substituted by Act 9 of 1964 w.e.f. 1.4.1964.

² Substituted by Act 4 of 1992 w.e.f. 1.10.1991

2[two lakh] rupees shall, and any other dealer may, get himself registered under this Act:

1[Provided that every

2[x x x]

manufacturer,

¹ Inserted by Act 4 of 1992 w.e.f. 1.4.1992.

² Omitted by Act 6 of 1995 w.e.f. 1.4.1995.

³ Omitted by Act 7 of 1997 w.e.f. 1.4.1997.

any goods into the State or to whom any goods are despatched from any place outside the State shall get himself registered under this Act, if his total turnover is not less than one lakh rupees in any year;]

1. (2) Not withstanding anything contained in sub-section (1),—
   • (i) every casual trader 1[x x x] ;
   • (ii) every dealer registered under the Central Sales Tax Act, 1956 (Central Act 74 of 1956);
   • (iii) every dealer residing outside the State but carrying on business in the State; 1[(iii-a) every dealer in liquor and/or beer and every dealer in jewellery;]

¹ Omitted by Act 8 of 1984 w.e.f. 1.4.1984.

¹ Inserted by Act 7 of 1997 w.e.f. 1.4.1997.

Sales Tax [1957: KAR. ACT 25

1. (iv) every manager or agent of a non-resident dealer; and
2. (v) every commission agent, broker, del credere agent, auctioneer or any other mercantile agent, by whatever name called, who carries on the business of buying, selling, supplying or distributing goods on behalf of any principal, shall get himself registered under this Act, irrespective of the quantum of his total turnover in such goods. 1[(3) Every miller whether he is a dealer or not shall get himself registered under this Act.] 1[(4) Nothing contained in this section shall apply to any State Government or the Central Government] 2[or a statutory body or a local authority except when they buy, sell, supply or distribute goods directly or otherwise for cash or deferred payment or for commission or remuneration or other valuable consideration in the course of business.] 1[(5) Nothing in this section shall apply to any dealer registered under the Karnataka Value Added Tax Act, 2003 and who is not a dealer in petrol, diesel, aviation turbine fuel, lottery tickets and sugarcane.] 10-A. Procedure for registration.- (1) An application for registration under section 10 shall be made to such authority, in such manner and within such period as may be prescribed and shall be accompanied by a fee of 1[five hundred rupees.]

¹ Inserted by Act 9 of 1970 w.e.f. 1.4.1970.

¹ Inserted by Act 23 of 1983 w.e.f. 1.4.1976.

² Inserted by Act 4 of 1992 w.e.f. 1.4.1992.

¹ Inserted by Act 7 of 2003 w.e.f. 1.4.2003.

¹ Substituted by Act 7 of 1997 w.e.f. 1.4.1997.

1. (2) If the prescribed authority after making such enquiries as it may consider necessary is satisfied that the application is in order and that the particulars furnished therein are correct, it shall register the applicant and issue to him a certificate in the prescribed form. 1[Provided that the applicant shall be deemed to be registered if the prescribed authority does not reject the application submitted within a period of thirty days from the date of submission of such application.]
2. (3) Where a dealer has more than one place of business, the registration certificate shall cover all such places of business. The prescribed authority shall issue copies of the registration certificate to the dealer for exhibition at each of his places of business and the dealer shall pay a fee of 1[five hundred rupees] for each copy. 1[(4) 2[(a) The prescribed authority shall for good and sufficient reasons demand from any dealer who is registered or has applied for 1957: KAR. ACT 25] Sales Tax registration under sub-section (1) or has applied for renewal of registration under this Act, security for proper payment of tax by him or for the proper custody and use of the forms referred to in 3[section 5-A , proviso to sub- section (2) of section 6-A and sub-section (2) of section 28-A or any of these provisions] and on such demand such dealer shall furnish the same.] 1[Provided that in the case of different categories of dealers in liquor and/or beer, the prescribed authority shall demand security, for proper payment of tax as the State Government may fix from time to time by notification.]
   • (b) The amount of security payable under clause (a) shall not exceed,—
     • (i) in the case of dealers who have opted to pay tax under section 17, an amount equivalent to three months compounded rate fixed for that year, and
     • (ii) in other cases, an amount equivalent to one-half of the tax anticipated to be payable by the dealer for that year: Provided that the assessing authority shall have power to demand at any time additional security if such authority has reason to believe that the security fixed was too low.
   • (c) The security paid under this sub-section in any year shall be maintained in full until it is dispensed with by the assessing authority on being satisfied that the reasons for its demand no longer exist or until the registration certificate is cancelled, whichever is earlier.] 1[(d) The assessing authority may by order and for good and sufficient cause forfeit the whole or any part of the security furnished by a dealer,—
     • (i) for realising any amount of tax or penalty payable by the dealer;
     • (ii) if the dealer is found to have mis-used any of 2[the forms referred to in clause (a) or to] have failed to keep them in proper custody: Provided that no order shall be passed under this clause without giving the dealer an opportunity of being heard;
   • (e) The assessing authority issuing the forms referred to in clause (a) may refuse to issue such forms to a dealer who has failed to comply with a demand under that clause or under clause (b), until the dealer has complied with such demand.] 2. By Errata No. 525 Karnataka Gazette (Extraordinary) dated 5.9.1988.

¹ Inserted by Act 26 of 2004 w.e.f. 1.8.2004.

¹ Substituted by Act 7 of 1997 w.e.f. 1.4.1997.

¹ Substituted by Act 9 of 1970 w.e.f. 1.4.1970.

² Substituted by Act 27 of 1985 w.e.f. 1.8.1985.

³ Substituted by Act 3 of 1998 w.e.f. 1.4.1998.

¹ Inserted by Act 7 of 1997 w.e.f. 1.4.1997.

¹ Inserted by Act 15 of 1988 w.e.f. 1.4.1988.

Sales Tax [1957: KAR. ACT 25

1[(5) A certificate issued under sub-section (2) shall be renewed from year to year on payment of the fee specified in sub-section (1) until it is cancelled.]

¹ Substituted by Act 23 of 1983 w.e.f. 18.11.1983.

1. (6) A dealer registered under sub-section (1) of section 10 shall be entitled to have his registration cancelled if he is able to prove to the satisfaction of the prescribed authority that his turnover in each of the two consecutive years immediately preceding the application was less than the limit mentioned in the said sub-section.
2. (7) The prescribed authority shall have power, for good and sufficient reasons, to cancel, modify or amend any registration certificate issued by it.
3. (8) No application for registration and no renewal under this section shall be refused and no order under sub-section (4) or sub-section (7) shall be made, unless the dealer concerned has been given a reasonable opportunity of being heard.
4. (9) When a dealer has ceased to do business in any year and gives notice of that fact to the prescribed authority, he shall not be liable to pay any registration fee from the commencement of the following year unless he resumes business.
5. (10) The dealer shall exhibit the certificate of registration granted under subsection (1) at the place of business mentioned in the certificate. Where the dealer has more than one place of business, he shall exhibit the certificate of registration at the principal place of business mentioned in the certificate and a copy of such certificate granted under sub-section (3) at every other place of business within the State mentioned in the certificate.] 1[(11) No dealer who is registered under the Karnataka Value Added Tax Act, 2003, shall be required to pay registration or renewal fee under this Act.]

¹ Inserted by Act 7 of 2003 w.e.f. 1.4.2003.

1[10-B. Suo motu registration.- Any person who is liable to get

¹ Inserted by Act 18 of 1999 w.e.f. 1.4.1999.

himself registered under this Act fails to do so, the prescribed authority may after conducting such survey, inspection or inquiry as may be prescribed, proceed to register such person under the Act and the provisions of section 10-A shall apply mutatis mutandis.]

(1) Notwithstanding anything contained in any law for the time being in force including this Act, every person who for an agreed commission or brokerage buys or sells on behalf of any principal who is a resident of the State of Karnataka shall, subject to the provisions of sub-section (5) of section 5 or section 6B be assessed to tax or taxes under this Act at the rate or rates leviable thereunder in respect of such purchase or sale notwithstanding that such principal is not a dealer or that the turnover of sale or purchase relating to such principal is less than the minimum specified in sub-section (5) of section 5 or section 6B:

1957: KAR. ACT 25] Sales Tax Provided that the principal, shall not be assessed to tax on his turnover in respect of which, the agent is liable to tax or taxes under sub- section (1) and the burden of proving that the turnover has been effected through an agent liable to tax under the said sub-section, shall be on such principal.

1. (2) Notwithstanding anything contained in sub-section (1), in respect of goods taxable at the point of purchase by the last dealer in the State liable to tax under this Act, the agent (other than the agent of a non-resident principal) purchasing such goods shall not be assessed to tax but the principal who has effected such purchases through the agent shall be assessed to tax as if he is the last dealer in the State.
2. (3) Without prejudice to his other rights, the agent who is assessed under sub-section (1), may retain out of the moneys payable to his principal other than a principal who is an agriculturist a sum equal to the amount of tax assessed on or paid by the agent.] 1[(4) x x x]

¹ Substituted by Act 23 of 1983 w.e.f. 18.11.1983.

¹ Inserted by Act 8 of 1984 w.e.f. 18.11.1983 & omitted by the same Act w.e.f. 1.12.1983.