Chapter V Chapter V

Return, assessment, payment, recovery and collection of tax

Returns and assessment.-

1. (1) Notwithstanding anything contained in Section 11, every promoter or person liable to get himself registered under this Act shall submit a return to the Assistant Commissioner for such period and within such period and in such manner containing such particulars as may be prescribed.
2. (2) Before any promoter submits any return under sub-section (1), he shall in the prescribed manner, pay in advance under Section 11, the full amount of tax payable by him for the period to which such return relates and shall furnish along with the return satisfactory proof of the payment of such tax, and 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) If the Assistant Commissioner is satisfied that any return submitted under sub-section
4. (1) is correct and complete, he shall assess the promoter or person on the basis thereof.
5. (4) If no return is submitted by the promoter under sub-section
6. (1) before the period prescribed or if the return submitted by him appears to the Assistant Commissioner to be incorrect or incomplete, he shall assess the promoter to the best of his judgment recording the reasons for such assessment: Provided that before taking action under this sub-section the promoter or person shall be given reasonable opportunity of proving the correctness and completeness of the return submitted by him.
7. (5) While making any assessment under sub-section (4), the Assistant Commissioner may also direct the promoter to pay in addition to the tax assessed a penalty equal to one half of the amount of tax due that was not disclosed by the promoter in his return or in the case of failure to submit a return, one half of the tax assessed.

1. (1) If the Assistant Commissioner has reasons to believe that any draw has escaped assessment to tax or has been assessed at a rate lower than the rate at which it is assessable under this Act, the Assistant Commissioner may, notwithstanding the fact that assessment in respect of such draw was already before him at the time of assessment or re-assessment, but subject to the provisions of sub-section (3), at any time within a period of three years from the expiry of the period to which the tax relates, proceed to assess or re-assess to the best of his judgment the tax payable by the promoter in respect of such draw after issuing a notice to the promoter and after making such enquiry as he may consider necessary.
2. (2) In making an assessment under sub-section
3. (1) the Assistant Commissioner may, if he is satisfied that the escapement from assessment is due to willful non-disclosure of the draw by the promoter, direct him to pay in addition to the tax assessed under sub-section
4. (1) a penalty equal to one half of the tax so assessed: Provided that no penalty under this sub-section shall be directed to be paid unless the promoter affected has had a reasonable opportunity of showing cause against such imposition.
5. (3) In computing the period of limitation for assessment under this Section the time during which an assessment has been deferred on account of any stay order granted by any Court or other authority or by reason of the fact that an appeal or other proceeding is pending, shall be excluded: Provided that nothing contained in this section limiting the time within which any action may be taken or any order, assessment or re-assessment may be made, shall apply to an assessment or re-assessment made on the promoter in consequence of, or to give effect to, any finding direction or order made under Sections 15 to 18 or any judgment or order made by the Supreme Court, the High Court or any other Court.

1. (1) Subject to such rules as may be prescribed, every promoter shall submit every Monday to the Assistant Commissioner a statement containing such particulars as may be prescribed relating to the draws to be conducted during the week commencing from the second Monday succeeding such day and shall pay in advance the full amount of tax payable by him under this Act, in respect of the draws shown in the statement and the amounts so payable shall for the purposes of Section 12 be deemed to be an amount due under this Act from such promoter: Provided that the tax relating to any draw to be conducted immediately after the commencement of this Act shall be paid within a period of five days from such commencement: Provided further that if any Monday is not a working day, the statement shall be filed on the immediately succeeding working day.
2. (2) If default is committed in the payment of tax for any week, whether or not a statement as required under sub-section
3. (1) is filed or if the amount of tax paid is less than the amount of tax payable for any week, the promoter defaulting payment of tax or making short payment of tax shall, in addition to the tax, pay interest calculated at the rate of two per cent per month from the date of such default or short payment to the date of payment of such tax.
4. (3) If no such statement is submitted by a promoter under sub-section
5. (1) before the date prescribed or if the statement submitted by him appears to the Assistant Commissioner to be incorrect or incomplete, the Assistant Commissioner may assess the promoter provisionally for that week to the best of his judgment, recording the reasons for such assessment, and proceed to demand and collect the tax forthwith on the basis of such assessment:

Payment and recovery of tax

1. (1) The tax or any other amount due under this Act shall be paid in such manner and within such time, as may be prescribed.
2. (2) If default is made in making payment in accordance with sub-section (1),-
   • (i) the whole of the amount outstanding on the date of default shall become immediately due and shall be a charge on the property of the promoter liable to pay tax under this Act;
   • (ii) the promoter liable to pay the tax or any other amount due under this Act shall pay a interest equal to two per cent of the amount of tax or any other amount due remaining unpaid for each month after the expiry of the time specified under sub-section (1). Explanation.- For the purposes of clause (ii), the interest payable for a part of a month shall be proportionately determined.
3. (3) Any amount, which remains unpaid under this Act after the due date of payment, shall be recoverable from a promoter in the manner specified under this Act.
4. (4) Any tax due or assessed, or any other amount due under this Act from a promoter or any other person, may without prejudice to any other mode of collection be recovered.-
   • (i) as if it were an arrear of land revenue; or
   • (ii) as if it were an arrear of sales tax under the Karnataka Sales Tax Act, 1957 (Karnataka Act 25 of 1957).

Recovery of tax, penalty, or any other amount, from certain other persons.-

1. (1) The Assistant Commissioner may at any time or from time to time, by notice in writing, a copy of which shall be forwarded to the promoter at his last address known to the Assistant Commissioner, require any person from whom money is due or may become due to the promoter or other person who holds or may subsequently hold money for or on account of the promoter or other person to pay to the Assistant Commissioner, 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 promoter or other person in respect of arrears of tax or penalty or the whole of the money when it is equal to or less than that amount.
2. (2) The Assistant Commissioner 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 the notice.
3. (3) Any person making any payment in compliance with a notice under this Section shall be deemed to have made the payment under the authority of the promoter or other person and the receipt of the Assistant Commissioner shall constitute a good and sufficient 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 promoter or other person after receipt of the notice referred to in this Section shall be personally liable to the Assistant Commissioner to the extent of the liability discharged or to the extent of the liability of the promoter for the amount due under this Act, whichever is less.
5. (5) Where any person to whom a notice under this Section is sent, proves to the satisfaction of the Assistant Commissioner issuing such notice, that the sum demanded or any part thereof is not due by him to the promoter or other person or that he does not hold any money for or on account of the promoter, then nothing contained in this Section shall be deemed to require such person to pay the sum demanded or any part thereof, to the Assistant Commissioner.
6. (6) Any amount which a person is required to pay to the Assistant Commissioner or for which he is personally liable to the Assistant Commissioner under this Section shall, if it remains unpaid, be a charge on the properties of the said person and may be recovered as if it were an arrear of land revenue or arrear of sales tax.
7. (7) For the purpose of this Section, the amount due to a promoter or money held for or on account of a promoter or other person by any person shall be computed after taking into account such claims, if any, as may have fallen due for payment by such promoter or other person to such person and as may be lawfully subsisting.

Tax payable on transfer of business, assessment of legal representatives, etc.-

1. (1) When the ownership of the business of a promoter other than a Government is transferred, the transferor and the transferee shall jointly and severally be liable to pay any tax or penalty or any other amount remaining unpaid at the time of transfer or that may become payable in respect of such business after the date of transfer but relating to the periods up to the date of transfer and for the purpose of recovery from the transferee, such transferee shall be deemed to be the promoter liable to pay the tax or penalty or other amount due under this Act.
2. (2) Where any firm is liable to pay any tax or 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.
3. (3) When a firm liable to pay the tax or penalty is dissolved, the assessment of the tax and imposition of penalty shall be made as if no dissolution of the firm had taken place, and every person who was at the time of dissolution 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 or penalty assessed or imposed.
4. (4) Where a partner of a firm liable to pay any tax or penalty or any other amount under this Act retires, he shall, notwithstanding any contract to the contrary, be liable to pay any tax or penalty or any other amount remaining unpaid at the time of his retirement, and any tax or penalty or any other amount due up to the date of retirement, though unassessed.
5. (5) When an undivided Hindu family or Aliyasanthana family liable to pay the tax or penalty is partitioned, the assessment of the tax and the imposition of penalty shall be made as if no partition of the family had 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 or penalty assessed or imposed.
6. (6) Where a promoter dies, his executor, administrator or other legal representative shall be deemed to be the promoter for the purposes of this Act and the provisions of this Act shall apply to him in respect of the business of the said deceased promoter: Provided that, in respect of any tax, penalty or fee assessed as payable by any such promoter or any tax, penalty or fee, which would have been payable by him under this Act if he had not died, the executor, administrator or other legal representative shall be liable only to the extent of the assets of the deceased in his hands.