The Jammu and Kashmir General Sales Tax Act, 1962
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17. Offences and penalties

(1) If any person-

(b) without reasonable cause fails to furnish the returns as required by sub-sections (1), (2) or (3) of section 7 or fails to furnish it within the time allowed; or

(d) without reasonable cause fails to produce accounts, registers, documents or any other information required under sub-section (1) of section 15; or

(e) without reasonable cause fails to furnish the return as required by section 15-B; or

(f) conceals his turnover or furnishes inaccurate particulars thereof;

Explanation : For the purpose of the this clause a dealer who has concealed his turnover or furnished inaccurate particulars of his turnover in the original return but gives correct turnover and accurate particulars thereof in the revised return furnished under sub-section (4) of section 7 of this Act, shall not be deemed to have concealed his turnover or furnished inaccurate particulars thereof; provided he proves to the satisfaction of the concerned authority that the revised return was furnished voluntarily and not in consequence of any information having come to the knowledge of any authority appointed under this Act before the date of furnishing the revised return; or

(h) charges tax on sales of goods in contravention of the provisions of this Act, but does not deposit the same within the period prescribed in sub-section (2) of section 8-B; or

(i) without reasonable cause fails to comply with the provisions of section 16-D; or

(j) fails to obtain certificate of registration; or

(k) fails to issue a sale bill or cash memo simultaneous with making a transaction of sale; or

(l) abets or aids a dealer in concealing his turnover or evasion of tax;

Explanation :- For the purpose of this clause a person shall be deemed to have abetted or aided the dealer in concealing his turnover or evasion of tax, if he purchases goods from the dealer without cash memo or credit memo or invoice as the case may be; or

(m) purchases raw material free of tax for manufacturing goods on the basis of declaration to the selling dealer but disposes of the same otherwise than the said purpose; or

(n) stores goods in any place of business other than the place of business declared in an application required to be made under sub section (2) of section 6 of this Act; or

(o) fails to get the vehicle or goods cleared at the Checkpost established under section 15-A without a reasonable cause; or

(p) makes a statement during the course of any proceedings under this Act or the rules made thereunder which he knows to be false or does not believe to be true,

the appropriate authority shall direct that such person shall pay in addition to the fee or tax by way of penalty;

(ii) for default specified in clause (b) a sum at the rate of 2% per month of the tax payable as reduced by the amount of tax paid during the period prescribed under sub-section (3) of section 8 of this Act for the period of default or rupees one thousand per month for the default whichever is higher;

(iii) for default specified in clause (c) a sum equal to 20% of the tax assessed as reduced by the tax paid on the basis of the quarterly returns during the period prescribed under sub-section (3) of section 8 if furnished;

(iv) for default specified under clause (d) and clause (e) a sum of Rupees fifty for each day of default subject to the maximum of Rupees one thousand;

(v) for default specified in clause (f) a sum not less than the amount of tax which was attempted to be evaded but not exceeding double the amount of such tax;

(vi) for default specified in clause (g) a sum not less than Rupees three thousand but not exceeding Rupees five thousand;

(vii) for default specified in clause (h) a sum not exceeding 50% of the tax collected;

(viii) for default specified in clause (i) a sum of five thousand rupees per contract;

(ix) for defaults specified in clause (j) a sum equal to double the amount of tax payable for the period of default provided if the dealer voluntarily furnishes the return and deposits the tax payable a penalty of not more than 20% of the tax due for the period of default;

(x) for default specified in clause (k) a penalty equal to five times of the tax payable on such transaction or five thousand rupees whichever is higher;

(xi) for default specified in clauses (l), (m), (n) a sum equal to double the amount of tax leviable on such goods;

(xii) for default specified in clause (o) a sum of five thousand rupees if the goods are of non taxable nature or exempt from payment of tax and double the amount of tax payable on such goods, if the goods are taxable; and

(xiii) for default specified in clause (p) a sum of not less than five thousand rupees.

(2) Before passing an order under sub-section (1) of this section the authorities concerned shall give the person in default an opportunity of being heard; provided that no order of penalty shall be passed after the expiry of two years from the close of the financial year in which such penalty proceedings were initiated:

Provided further that a fresh order under sub-section (1) of this section in pursuance of order under section 11 or section 12 of this Act shall be passed within 2 years after close of the financial year in which the order under section 11 or section 12 of the Act is passed.