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TMI Blog2013 (1) TMI 273X X X X Extracts X X X X X X X X Extracts X X X X ..... case also, security of an amount not exceeding one half of the tax payable on the turn over as estimated by the registering authority can be demanded. Proviso states that the registering authority shall have the power to demand at any time additional security only in a case where he is satisfied that the turn over estimated by him under sub section (1) or (2) for the purpose of fixing one half of the tax payable for the year is too low. Once registration is granted accepting security as above, when turnover estimated based on which one half tax payable is fixed, is found to be too low, for making up the shortage of the one half of the tax payable as security, additional security can be demanded. As far as the provisions of the CST ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ction 17 of the Act r/w Rule 19 of the KVAT Rules. Petitioner did not furnish security as directed. Therefore, Ext.P6 order was issued cancelling his registration both under the Act and under CST Act. It is challenging Ext.P6 order, the writ petition is filed. 3. A reading of Ext.P6 shows that in addition to the powers under Section 17 of the KVAT Act, power under Section 7(4)(b) of the CST Act has also been invoked and that it is accordingly that registration under the KVAT Act and CST Act were cancelled. Contention raised by the counsel for the petitioner is that the registrations under the KVAT Act and CST Act have been cancelled ignoring the provisions of Section 17 of the KVAT Act and Section 7 of the CST Act and therefore, the im ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he registering authority: Provided that the registering authority shall have the power to demand at any time additional security if such authority has reason to believe that the turnover estimated under sub-sections (1) or (2) was too low. Provided further that no security or additional security shall be demanded under this sub-section from a dealer falling under clause (ii) of sub-section (2) of section 15. 7. Insofar as Section 17 of the KVAT Act is concerned, sub section (1) enables the registering authority to demand security from the dealer for an amount not exceeding one half of the tax payable for the year on the turnover of the dealer as estimated by him. Sub section (2) deals with the case of dealers effecting first sale ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct or for the proper custody and use of the forms referred to in clause (a) of the first proviso to sub-section (2) of section 6 or sub section (1) of section 6A or [sub-section (4) of section8], he may, by an order in writing and for reasons to be recorded therein, impose as a condition for the issue of a certificate of registration a requirement that the dealer shall furnish in the prescribed manner and within such time as may be specified in the order such security as may be so specified, for all or any of the aforesaid purposes. 7(3A). Where it appears necessary to the authority granting a certificate of registration under this section so to do for the proper realization of tax payable under this Act or for the proper custody and use ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e of a dealer who has made an application or who has been registered in pursuance of an application, under sub-section (2), a sum equal to the tax leviable under this Act, in accordance with the estimate of such authority on the sales to such dealer in the course of inter-State trade or commerce in the year in which such security or, as the case may be additional security is required to be furnished, had such dealer been not registered under this Act. 9. As far as the provisions of the CST Act are concerned, here also, Section 7(3A) provides not only for furnishing of security but also additional security. However, maximum amount for which additional security can be demanded is prescribed in sub section (3BB). This again is related to ..... X X X X Extracts X X X X X X X X Extracts X X X X
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