Chapter IV ASSESSMENT

1. (1) Every registered dealer shall file a tax return for each tax period within fifteen days after end of the period in such manner as may be prescribed.
2. (2) The returns submitted by the dealer along with tax due thereon shall be accepted as self-assessed: Provided that the assessing authority may select either at his discretion or as directed by the Commissioner, any dealer for detailed assessment for a year by scrutiny of accounts and may make best judgement assessment if so required, where-
   • (a) a person fails to file a return as required under sub-section (1); or
   • (b) the assessing authority is not satisfied with the correctness and completeness of a return filed by a person; or
   • (c) the Commissioner has reasonable ground to believe that a person will become liable to pay tax under this Act but is unlikely to pay the amount due.
3. (3) When making any assessment under sub-section (2), the assessing authority may also direct the dealer to pay in addition to the tax assessed, a penalty not exceeding double the amount of tax due on the turnover that was not disclosed by the dealer in his return or, in the case of failure to submit a return, double the amount of tax assessed, as the case may be: Provided that before taking action under this sub-section, the dealer shall be given a reasonable opportunity of being heard.
4. (4) The assessing authority shall serve a notice of assessment on completion of assessment under this section and the dealer shall pay the balance of tax in accordance with the terms of that notice.
5. (5) Subject to sub-section
6. (6) of this section, no assessment under this section for any year shall be made after a period of three years from the end of the year to which the return under this Act relates.
7. (6) Where, for any reason, the input tax credit has been availed wrongly or where any dealer produces false invoice, vouchers, declaration certificate or any other documents with a view to support his claim of input tax credit or refund, the assessing authority shall, at any time, within a period of five years from the end of the year to which the return relates, reverse input tax credit availed and determine the tax due after making such an enquiry as it may consider necessary:

Fair market value

1. (1) Where the authority prescribed has reason to believe that any goods of a fair market value exceeding Rs. 5,000 (Rupees five thousand only) have been sold or purchased by a dealer, to or from another dealer or person, as the case may be, for a consideration which is less than fair market price of the goods and that consideration for such sale or purchase as agreed to between the parties has not been truly stated in the invoice or delivery challan or any other document relating thereto, with the object of facilitating the reduction or evasion of the tax payable under this Act, the authority prescribed may, subject to the provisions of this section, initiate proceedings for seizure and the acquisition of such goods.
2. (2) The powers conferred under sub-section
3. (1) shall be exercised by the authority prescribed in respect of goods sold or purchased which are in transit or in the possession of the seller or buyer or his agent.
4. (3) In any proceedings under this section in respect of any goods which have been sold or purchased for a consideration which is less than its fair market price, it shall be presumed, unless the contrary is proved, that the consideration for such sale as agreed to between the parties has not been truly stated in the invoice, or sale bill or other documents related thereto with such object as is referred to in sub-section (1).
5. (4) Before initiating such proceedings, the authority prescribed shall record his reasons for doing so and no orders shall be passed under sub-section
6. (1) without giving the dealer concerned an opportunity of being heard.
7. (5) No such proceedings shall be initiated unless the authority prescribed has reason to believe that the fair market price of the goods exceeds the consideration therefor by more than twenty per cent.
8. (6) Where any goods are acquired under this section the authority prescribed shall pay for such acquisition compensation which shall be a sum equal to the aggregate of the amount of sale price of the goods mentioned in the invoice or delivery challan or any document related thereto and any expenditure incurred on freight or any other incidental expenses incurred by the dealer concerned in relation to those goods. Explanation.ó For the purposes of this section, ëfair market valueí means the price that the goods would ordinarily fetch on sale in the open market on the date of sale or despatch or transfer of such goods.
9. (7) If the assessing authority is satisfied that a dealer has, with a view to evade the payment of tax, shown in his accounts, sales or purchases of any goods, at prices which are abnormally low compared to the prevailing market price of such goods, it may at any time within a period of five years from the expiry of the year to which the tax relates, assess or re-assess the dealer to the best of its judgement on the turnover of such sales or purchases after making such enquiry as it may consider necessary and after giving the dealer a reasonable opportunity to show cause against such assessment.

If any registered dealer discovers any mistake or error in any return furnished by him, he may furnish a revised return subject to following conditions:

1. (a) A dealer shall not be eligible to furnish revised return if any action, either has been initiated or is pending under section 24 or section 30 or under any other section of this Act.
2. (b) If any amount is becoming due for refund as per revised return, such revised return shall be furnished within three months from the close of the year to which such return relates to and shall be accompanied by an application stating the circumstances on which the revised return is filed. The refund will be due only after confirmation by the assessing authority by issue of a notice as may be prescribed.
3. (c) If any amount is due to be paid by a dealer as per revised return, such return may be furnished at any time and will be accepted by the assessing authority, if the return is accompanied by the proof of payment of balance tax as per the revised return and penalty as prescribed under sub-section

1. (4) of section 37 of this Act.

When a dealer receives in any year any amount, due to price variation which would have been in his turnover for any previous tax period if it had been received by him during that period, it shall be deemed to be the turnover during the tax period in which such amount was received and he shall, during the tax period in which such amount was received, include such amount in the return separately for the tax period and the assessing authority shall proceed to assess the tax payable on such amount as his turnover of that tax period.

No assessment or other proceedings purporting to be made, issued or executed under this Act, shall be,ó

1. (a) quashed or deemed to be void or voidable for want of form; or
2. (b) affected by reason of mistake, defect or omission therein, if it is in substance and effect, in conformity with this Act or the rules made thereunder and the person assessed, or intended to be assessed or affected by the document is designated in it according to common understanding.

Where a dealer dies, his executor, administrator, or other legal representative shall be deemed to be the dealer 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 dealer, provided that in respect of any tax or fee assessed as payable by any such dealer or any tax 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.

1. (1) Where, for any reason, the whole or any part of turnover of business of a dealer has escaped assessment to tax, the assessing authority may, subject to the provisions of sub-section (3), at any time within a period of five years from the expiry of the year to which the return under this Act relates, determine to the best of its judgment the turnover which has escaped assessment and assess the tax payable on such turnover after making such enquiry as it may consider necessary and after giving the dealer a reasonable opportunity to show cause against such assessment.
2. (2) Where, for any reason, the whole or any part of the turnover of business of a dealer has been assessed at a rate lower than the rate at which it is assessable, the assessing authority may, at any time within a period of five years from the expiry of the year to which the return under this Act relates, re-assess the tax due after making such enquiry as it may consider necessary and after giving the dealer a reasonable opportunity to showcause against such re-assessment.
3. (3) In making an assessment under sub-section (1), the assessing authority may, if it is satisfied that the escape from assessment is due to non-disclosure of assessable turnover by the dealer, direct the dealer to pay, in addition to the tax assessed under sub-section (1), a penalty of double the amount of the tax so assessed: Provided that no penalty shall be imposed under this section unless the dealer affected has had a reasonable opportunity of showing cause against such imposition.
4. (4) The powers under sub-section
5. (1) or sub-section
6. (2) may be exercised by the assessing authority even though the original order of assessment, if any, passed in the matter has been the subject matter of an appeal or revision.
7. (5) In computing the period of limitation for assessment or re-assessment under this section, the time during which the proceedings for assessment or re-assessment remained stayed under the orders of a Civil Court or other authority shall be excluded.

The Government may, by notification, reduce the tax payable under sub-section

1. (1) of section 14 of this Act in respect of any goods, subject to such restrictions and conditions as may be specified in the notification.

If any restriction or condition notified under section 31 is contravened or is not observed by a dealer, the sales or purchases of such dealer may, with effect from the commencement of the year in which such contravention or non-observance took place, be assessed to tax or taxes under the appropriate provisions of this Act as if the provisions of the notification under section 31 did not apply to such sales or purchases.

1. (1) Where any firm is liable to pay any tax or 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 or any amount under this Act retires, he shall, notwithstanding any contract to the contrary, be liable to pay the tax or other amount remaining unpaid at the time of his retirement and any tax or other amount due up to the date of retirement, though un-assessed.

Where a dealer is a Hindu undivided family, firm, or other association of persons, and such family, firm or association is partitioned, or dissolved, as the case may be,

1. (a) the tax payable under this Act by such family, firm, or association of persons for the period up to the date of such partition or dissolution shall be assessed as if no such partition or dissolution had taken place and all the provisions of this Act apply accordingly; and
2. (b) every person who was at the time of such partition, or dissolution a member or partner of the Hindu undivided family, firm or association of persons and the legal representative of any such person who is deceased shall, notwithstanding such partition or dissolution, be jointly and severally liable for the payment of the tax, penalty or other amount payable under this Act, by such family, firm or association of persons, whether assessment is made prior to or after such partition or dissolution.