(a) Security for registration referred to in section 6-C may be in any of the following forms:-

(i) Cash deposit in the treasury under the head 0040-Sales Tax.

(i) Fixed deposit receipt from a Scheduled Bank, or Nationalized Bank pledged to the Deputy Sales Tax Commissioner of the Division.

(ii) Bank guarantee from a Scheduled or Nationalized Bank agreeing to pay to the Government on demand the amount at any time during the currency of the certificate of registration.

Provided that the appropriate authority may in his discretion allow a dealer who is a permanent resident of the State within the meaning of section 6 of the constitution of the Jammu and Kashmir State, to furnish security in the shape of personal bond on non-judicial paper in Form ST-11-A of appropriate value with sureties of two dealer registered under the Act having annual taxable turnover of not less than Rs 5 lacs.

Provided further that, in the case of dealers, involved in the execution of works contracts, where tax is deducted at source, the requirement of furnishing the security shall be waived off.

Explanation- For removal of doubt it is clarified that for the purpose of this sub-rule registration shall include provisional registration.

(b) Security shall be demanded for an amount equal to 10% of the annual estimated taxable turnover for the purpose of the registration and for an amount equal to 10% of the value of the goods intended to be imported by the manufacturer or Rs. 20,000/- whichever is less, for purpose of provisional registration;

Provided that the Commissioner may relax the requirement of security in case of class of manufacturers or contractors entitled to provisional registration subject to such conditions, as he may consider, necessary.