Chapter III Chapter III

Registration

Liability to register.-

1. (1) Every dealer whose total turnover exceeds or who reasonably expects his total turnover to exceed two lakh rupees, as computed under the provisions of the Karnataka Sales Tax Act 1957 (Karnataka Act 25 of 1957), in the year ending Thirty First day of March 2003 shall be liable to be registered and report such liability on such date as may be notified by the Government.
2. (2) Every dealer who at any time has reason to believe that his taxable turnover is likely to exceed two lakh rupees during any year after the year ending Thirty First day of March 2003 shall be liable to be registered and report such liability forthwith or on such date as may be notified by the Government.
3. (3) Every dealer whose taxable turnover exceeds fifteen thousand rupees in any one month after the date from which the tax shall be levied, in accordance with Section 3, and every dealer executing a works contract whose receipts or amounts receivable by way of consideration towards work executed exceed fifteen thousand rupees in any one month after the date from which the tax shall be levied, shall register forthwith.
4. (4) Every dealer to whom a business or part of a business is transferred by another dealer who is liable to be registered under this Act, shall apply for registration from the date of that transfer, if he is not already registered.
5. (5) Every dealer liable to register under sub-sections (2),
6. (3) or
7. (4) shall report his liability to be registered in the prescribed manner at the end of the month on which that liability arises or on such date as may be notified under sub-section (2).
8. (6) Every dealer who obtains or brings taxable goods from outside the State, whether as a result of purchase or otherwise, shall be liable to be registered after such first purchase or procurement irrespective of the value of goods purchased or procured and shall report such liability at the end of the month in which such purchase or procurement takes place.
9. (7) Every dealer who exports taxable goods is liable to register after the first export and shall report such liability at the end of the month in which such export takes place.
10. (8) Every dealer who effects sale of taxable goods in the course of interstate trade or commerce or dispatches taxable goods to a place outside the State is liable to register after the first sale or dispatch and shall report such liability at the end of the month in which such sale or dispatch takes place.
11. (9) Every casual trader and every non-resident dealer or his agent shall be liable to register after his first sale irrespective of the value of the taxable goods sold and shall report such liability forthwith.
12. (10) In determining whether a person is liable to be registered under sub-sections (1),
13. (2) or (3), the prescribed authority may have regard to the total or taxable turnover or total receipts of any other person where both persons are associates, and, where the prescribed authority deems that any business has been deliberately broken up into smaller businesses to avoid registration, the prescribed authority may issue a notice requiring those businesses to be registered as one business entity.

Voluntary registration.- A dealer who sells taxable goods, though not liable to register under Section 22 but who desires to register voluntarily, shall make an application to the prescribed authority in such form and in such manner as may be prescribed, giving correct and complete particulars.

Suo motu registration.- Where a dealer liable to be registered has failed to inform the competent authority of his liability to be registered, the competent authority may after conducting such survey, inspection or enquiry as may be prescribed, proceed to register such person under Section 22.

Registration.-

1. (1) The form of application to register under Section 22 or 23, the time and manner of making application, and the fee, payable shall be as may be prescribed.
2. (2) On receipt of an application to register under Section 22 or 23, the prescribed authority shall register any such dealer and grant him a certificate of registration, if he is satisfied that the applicant is a bona fide dealer and that he complies with the requirements of this Act, with effect from the first day of the month following the month in which such application is made or from such earlier date as may be mutually agreed.
3. (3) The prescribed authority may refuse to grant a certificate of registration to the applicant for any good and sufficient reasons to be recorded in writing, after allowing the applicant to show cause in writing against such refusal.
4. (4) In respect of the Central Government, any State Government, any statutory body or any local authority liable to collect tax under sub-section
5. (2) of Section 9, the Commissioner may authorise issue of a certificate of registration to such body in the manner as may be prescribed.

Security.-

1. (1) The prescribed authority may, for the proper payment of the tax, from time to time demand from a registered dealer or from a dealer who has applied for registration under this Act, reasonable security not exceeding a prescribed amount to be paid in the prescribed manner.
2. (2) The prescribed authority may, by order, forfeit the whole or any portion of the security furnished by a dealer,
   • (a) for collecting any amount of tax, interest or penalty that is payable by such dealer, or
   • (b) if such dealer is found to have misused any prescribed certificate or declaration or has failed to keep or retain them in the prescribed manner.
3. (3) No order shall be passed under sub-section (2), without giving the dealer an opportunity of showing cause in writing against such forfeiture.

Cancellation of registration.-

1. (1) In any case where,
   • (a) any business of a registered dealer has been discontinued, transferred fully or otherwise disposed of; or
   • (b) there is any change in the status of the ownership of the business; or
   • (c) the taxable turnover of sale of goods of a registered dealer has, during any period of twentyfour consecutive months, not exceeded two lakh rupees; or
   • (d) a dealer issues tax invoices without effecting any taxable sales; or
   • (e) a dealer being an individual, registered under this Act dies, and for any other good and sufficient reason, the prescribed authority may, either on its own motion or on the application of the dealer, or in the case of death, on the application of the legal heirs, made in the prescribed manner, cancel the registration certificate from such date, including any anterior date, as it considers fit having regard to the circumstances of the case.
2. (2) The cancellation of a certificate of registration under this Section shall not affect the liability of the dealer to pay tax, any penalty and interest due for any period prior to the date of cancellation whether or not such tax, penalty and interest is assessed before the date of cancellation but remains unpaid, or is assessed thereafter.
3. (3) On cancellation of registration, except where the businesses is transferred as a whole to another registered dealer as specified, a dealer who has availed deduction of input tax, shall be liable to pay tax on any taxable goods held by him at their prevalent market price.
4. (4) A dealer liable to pay tax under sub-section
5. (3) shall furnish a final return at such time as may be prescribed.

Obligation of registered dealer to inform changes after registration.-

1. (1) Where.-
   • (a) a registered dealer sells or otherwise disposes of his business or any part thereof, or
   • (b) there is any other change in the ownership of the business including any change in the status, or
   • (c) a registered dealer discontinues his business or changes his place of business or opens a new place of business, or
   • (d) a registered dealer changes the name or nature of the business, such registered dealer or, in case of his death his legal representative, shall within the prescribed time, inform the prescribed authority accordingly.
2. (2) Where,-
   • (a) a change of ownership of the business takes place on account of transfer of business from one registered dealer to another, the dealer succeeding to the business, or
   • (b) there is any change in the status of the ownership of the business, such registered dealer shall surrender the certificate of registration already issued in respect of the business and apply for registration afresh in the prescribed manner.
3. (3) On any application for amendment of a certificate of registration or upon his own motion, the prescribed authority may amend the registration certificate of a dealer or reject the application within thirty days of the date of receipt of such application, after making such enquiry as it deems fit and after giving the dealer the opportunity of showing cause in writing against such amendment or rejection.
4. (4) Any amendment of a certificate shall take effect from the date of the event referred to in sub-section
5. (1) where applicable and in all other cases the amendment shall take effect from the date of application.
6. (5) Where any change in registration other than of death of the registered dealer is not reported to the prescribed authority within the prescribed time, it shall be deemed that no such change has occurred and the dealer as registered shall be liable to tax that is payable in respect of any business carried on.