Incidence of tax

(1) Every dealer, - (a) whose gross turnover of sales during the year immediately preceding the commencement of this Act, - (i) who has been liable immediately before the appointed day to pay tax under the Sikkim Sales Tax Act, 1983 or the Central Act, or (ii) whose gross turnover during a year first exceeds the taxable limit on the day immediately preceding the appointed day, and (b) who is in possession of a registration certificate under the Sikkim Sales Tax Act, 1983 before the appointed day and to whom clause (a) does not apply, shall be liable to pay tax under this Act on all sales effected on or after the appointed day. (2) Every dealer on whom sub-section (1) does not apply shall, if his gross turnover of sales calculated from the commencement of any year exceeds the taxable limit at any time within such year, be liable to pay tax under this Act on all sales, effected on and from the date immediately following the day on which such gross turnover of sales first exceeds the taxable limit. (3) In this Act, the expression "taxable limit" means in relation to any dealer - (a) who imports for sale any goods into Sikkim, for himself or on behalf of his principal: NIL (b) who manufactures or produces any goods for sale: Rs. 2,00,000/- (c) who is engaged in any other business other than clauses (a) and (b): Rs. 2,00,000/- (d) involved in the execution of works contract: Rs. 1,00,000/- (4) The State Government may, by notification in the Official Gazette, increase the taxable limit, in the case of any class of dealers, not exceeding rupees fifty lakhs, from time to time. (5) Every dealer who has become liable to pay tax under sub-section (1) or Sub-section (2) shall continue to be so liable until the expiry of three consecutive years, during each of which his gross turnover of sales has failed to exceed the taxable limit or such further period after the date of such expiry as may be allowed by the general or special order notified by the Commissioner and on the expiry of this period his liability to pay tax under sub-section (1) or sub section (2) shall cease. Explanation - For the purpose of sub-section (5) in computing the period of three consecutive years in respect of a dealer who has become liable to pay tax under sub-section (1), three years which expired before the appointed day during which or each of which the gross turnover failed to exceed the taxable limit shall not be included. (6) Every dealer whose liability to pay tax under sub-section (1) or sub-section (2) has ceased under sub-section (5), shall, if his gross turnover of sales calculated from the commencement of any year again exceeds the taxable limit at any time within such year, he shall be liable to pay such tax on all sales, effected on and from the date immediately following the day on which such gross turnover of sales again first exceeds the taxable limit. (7) The Commissioner shall, after making such enquiry as he may think necessary and after giving the dealer an opportunity of being heard, fix the date on and from which such dealer shall become liable to pay a tax under such section (2) or sub-section (5).