25. Security to be furnished in certain cases.
(1) Where it appears to the Prescribed Authority to be necessary so to do for the proper realisation of the tax payable under this Act or for the proper custody and use of the forms, 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.
(2) Where it appears to the Prescribed Authority granting a certificate of registration to be necessary so to do for the proper realisation of tax payable under this Act or for the proper custody and use of the forms, 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 in the order and in the prescribed manner such security, or, if the dealer has already furnished any security in pursuance of an order under this sub-section or sub-section (1), such additional security, as may be specified in the order, for all or any of the aforesaid purposes.
(3) The Prescribed Authority may, by an order in writing and for good or sufficient reason to be recorded therein, demand from any person other than a registered dealer who imports into the State any consignment of goods, a reasonable security for ensuring that there is no evasion of tax.
(4) No dealer shall be required to furnish any security under sub-section (1) or any security or additional security under sub-section (2) or any security under sub-section (3) unless he has been given a reasonable opportunity of being heard.
(5) The amount of security which a dealer may be required to furnish under sub-section (1) or sub-section (2) or the aggregate of the amount of such security and the amount of additional security which he may be required to furnish under sub-section (2) or the amount of security which he may be required to furnish under sub-section (3), by the Prescribed Authority, shall not exceed, the sum equal to the tax payable under this Act, in accordance with the estimate of such authority, on the turnover of such dealer for a tax period of the year in which such security or, as the case may be, additional security is required to be furnished.
(6) If the Prescribed Authority is satisfied that any dealer has been carrying on business without furnishing the security demanded under this section, it may, after such enquiry, if any, as it may deem necessary, direct that such dealer shall pay, by way of penalty in addition to the tax, if any, payable by him a sum of one hundred rupees for each month or part thereof for default during the first three months and five hundred rupees for every month or part thereof after first three months during which the default continues:
Provided that no order shall be passed under this sub-section without giving the dealer a reasonable opportunity of being heard.
(7) The Prescribed Authority may, by an order in writing and for good and sufficient reasons to be recorded therein, forfeit the whole or any part of the security or additional security, furnished by a dealer, for,—
(a) realising or recovery of tax or any other sum due; or
(b) recovery of any financial loss caused to the Government due to negligence or default in making proper use of statutory forms or in keeping in safe custody, blank or unused statutory forms:
(8) Where, by reason of the order of the forfeiture of the security, the security furnished by a dealer is rendered, insufficient, such dealer shall, on demand by an order of the Prescribed Authority, furnish fresh or further security of the requisite amount or shall make up the deficiency, as the case may be, in such manner and within such period as may be specified by the Prescribed Authority.
(9) The Prescribed Authority may, on application by a dealer, who has furnished security as required, refund in the prescribed manner any amount of security or part thereof if such security is not required for the purposes for which it was furnished.