(1)Where it appears to the authority to whom an application is made under section 7 to be necessary so to do for the proper realization of the tax payable, 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 purposes of this Act.(2)Where it appears to the Commissioner or any other person appointed to assist him under sub-section (1) of section 3 to be necessary so to do for the proper realization of tax payable under this Act, he may, at any time while such certificate is in force, by an order in writing and for reasons to be recorded therein, require the dealer, to whom the certificate has been granted to furnish within such time as may be specified has been granted, to furnish within such time as may be specified in the order and in the prescribed of an order under this sub-section or sub-section (1) such additional security, as may be specified in the order for the aforesaid purpose.(3)No dealer shall be required to furnish a security under subsection (1) or sub-section (2) by the authority referred to therein, unless he has been given a reasonable opportunity of being heard and the amount of security that may be required to be furnished by any dealer under either of the aforesaid sub-section or the aggregate of the amount of such security and the amount of additional security that may be required to be furnished by any dealer under sub-section (2), shall in no case exceed the tax payable, in accordance with the estimate of such authority, on the turnover of the dealer for the year in which such security or, as the case may be, additional security is required to be furnished.(4)Where the security furnished by a dealer under sub-section (1) or subsection (2) is in the form of surety bond and the surety becomes insolvent or is other wise incapacitated or dies or withdraws, the dealer shall, within thirty days of the occurrence of any of the aforesaid events, inform the authority granting the certificate of registration and shall within ninety days of such occurrence furnish a rash surety bond or furnish in the prescribed manner other security for the amount of the bond.(5)The commissioner or any person appointed to assist him under sub-section (1) of section 3 may, by order and for good and sufficient cause, forfeit the whole or any part of the security furnished by a dealer for realizing any amount payable by the dealer under this Act:Provided that no order shall be passed under this sub-section without giving the dealer a reasonable opportunity of being heard.(6)Where by reason of an order under sub-section (5), the security furnished by any dealer is rendered insufficient he shall make up the deficiency in such manner and within such time as may be prescribed.(7)If a dealer fails to comply with and order under sub-section (2) or with the provisions of sub-section (4) sub-or section (6) the Commissioner or any person appointed to assist him under subsection (1) of section 3, may after affording the dealer a reasonable opportunity of being heard, order the rejection of the application for registration, or if the dealer is already registered under this Act, cancel his registration certificate, as the case may be. In the event of rejection of application for registration, or cancellation of the certificate of registration as the case may be, the dealer shall be deemed to have failed to apply for registration.
