(1) Subject to such conditions as may be prescribed, this section shall apply where, in relation to the sale of goods by any dealer,—
(a) that sale has been cancelled;
(b) the nature of that sale has been fundamentally varied or altered;
(c) the previously agreed consideration for that sale has been altered by agreement with the recipient, whether due to the offer of a discount or for any other reason;
(d) the goods or part of the goods sold have been returned to the dealer within six months of the date of sale; or
(e) the whole or part of the price owed by the buyer for the purchase of the goods has been written-off by the dealer as a bad debt; and the dealer has—
(i) provided a tax invoice in relation to that sale and the amount shown therein as tax charged on that sale is not the tax properly chargeable on that sale; or
(ii) furnished a return in relation to a tax period in respect of which tax on that sale is attributable, and has accounted for an amount of tax on that sale that is not the amount properly chargeable on that sale.
(2) Where a dealer has accounted for an incorrect amount of tax as contemplated in sub-section (1), that dealer shall make an adjustment in calculating the tax payable by that dealer in the return for the tax period during which it has become apparent that the tax is incorrect, and if—
(a) the tax payable in relation to that sale exceeds the tax actually accounted for by the dealer, the amount of that excess shall be deemed to arise in the tax period in which the adjustment is made, and shall not be attributable to any prior tax period; or
(b) the tax actually accounted for exceeds the tax payable in relation to the sale, the amount of that deficiency shall be subtracted from the tax payable by the dealer in the tax period in which the adjustment is made, and shall not be attributable to any prior tax period.
Sale exempt from tax.
Certain sales not liable to tax.
Adjustments of tax.
36 of 2002.
10 THE GAZETTE OF INDIA EXTRAORDINARY [PART II—
(3) Where a dealer sells goods that have been used in part for making—
(a) sales that are subject to tax under this Regulation or sales that are not liable to tax under section 7; and
(b) partly for other purposes, the amount of tax on the sale of the goods shall be the greater of—
(i) A— (A x B / C); or
(ii) A— B;
where A = the tax for which the dealer would be liable in respect of the sale apart from this section;
B = the amount by which the tax credit of the dealer in respect of the goods was reduced under sub-section (4) of section 9;
C = the amount of the tax credit before reduction under sub-section (4) of section 9.