(1) Notwithstanding anything contained in section 3 of this Act, there shall be levied and collected a tax on the entry of a motor vehicle by a person into a local area for use or sale therein, provided that such motor vehicle is liable for registration or assignment of a new registration mark in the State under the Motor Vehicles Act, 1988:

Provided that no Registering and Licensing Authority, functioning under the Motor Vehicles Act, 1988, shall register such motor vehicle unless the person making application for registration furnishes proof of having deposited the tax payable under this section from the Assessing Authority:

Provided further that no tax shall be levied and paid in respect of a motor vehicle which was registered in any Union Territory or any other State under the Motor Vehicles Act, 1988, for a period of fifteen months or more before the date on which it is registered in the State under that Act.

(2) The tax shall be levied on purchase value of a motor vehicle at the rate equal to the difference between the rate of value added tax notified under the VATAct and the rate of value added tax or the central sales tax charged, on the sale of the motor vehicle, in the invoice relating to the purchase of the vehicle:

Provided that for the purpose of this section, the rate of value added tax applicable in the State shall be taken as on the date mentioned in the invoice relating to the purchase of the motor vehicle:

Provided further that if no invoice in respect of purchase of the motor vehicle is produced or if the invoice does not show the rate of the value added tax applicable in the concerned State or the central sales tax, as the case may be, charged, then the rate of tax leviable under this section shall be calculated at the rate of value added tax applicable in Himachal Pradesh on the date of assessment.