Section 40A in Punjab General Sales Tax Rules, 1949
40A. [ Compounding of tax in certain cases [Rule 40A inserted by GSR 48/P.A.46/48/S.27/Amd(43) dated 6.5.1983.]
:- (1) Notwithstanding anything contained in these rules, where gross turnover of a registered dealer in any year does not exceed two lac rupees and the tax paid by him for that year exceeds the amount of tax assessed under section 11 for the immediate preceding year; or the amount accepted by way of composition in lieu of tax for the immediate preceding year, as the case may be, by not less than fifteen per cent, then on the request of such a dealer made within a period of two months from the close of that year, the Commissioner may, without prejudice to the generality of his power to compound the tax under sub-section (2) of section 10 accept by way of composition the amount paid by the dealer in lieu of amount of tax that would have been assessed as tax payable for that year subject to the following conditions :-(i)the returns filed by such a dealer in respect of his gross turnover are correct and complete in every respect;(ii)no penalty has been imposed on such a dealer under the Act for the evasion of tax during that year or no proceedings for evasion of tax during that year are pending before any authority against such a dealer; and(iii)the claims of deductions from gross turnover made by such a dealer in relation to any transaction during that year are not found to be ingenuine.Explanation. - For determining whether the tax paid by a dealer for any year exceeds the amount of tax assessed under section 11 for the immediate preceding year or the amount accepted by way of composition thereof tax for the immediate preceding year, as the case may be, by not less than fifteen per cent, the amount, if any, accountable to an increase in the rate of tax shall be ignored.(2)On the receipt of an application from the dealer for compounding of tax under sub-rule (1) the Commissioner shall call for the returns filed by such dealer in respect of his gross turnover for that year and all other relevant documents for scrutiny and any deficiency or discrepancy noticed by him shall be pointed out to the dealer by means of a check-slip within a period of three months from the date of receipt of the said application requiring him to rectify the deficiency or discrepancy so pointed out within a period of one month from the receipt of check-slip by him.(3)Where the registered dealer fails to comply with the requirements of check-slip issued under sub-rule (2) or the Commissioner is otherwise not satisfied, he shall after affording an opportunity of being heard to such a dealer return the case to the assessing authority for making assessment under sub-section (2) of section 11 of the Act.]
