(1) A registered person is liable to be
(a) he ceases to carry on his business;
(b) his supplies are no longer chargeable to the sales tax;
(c) his turnover during the last twelve months in case of manufacturer, is
below one million rupees and in case of a retailer, is below five million
(d) he fails to file sales tax return consecutively for six months.
(2) A person liable to be de-registered under
clause (a), (b) or (c) of sub-rule (1) shall make an application to the
concerned Collector of Sales Tax specifying there in the grounds for
(3) On receipt of application under sub-rule
(2), an officer not below the rank on an Auditor or a Deputy Superintendent
of Sales Tax shall be assigned to visit the registered office or the
business premises of the registered person, wherever records are kept, and
examine, inspect and audit the relevant records and also to verify the
physical stocks of taxable inputs and taxable supplies made so as to
ascertain whether the applicant qualifies for de-registration.
(4) If, on the basis of inquiry under sub-rule
(3), the concerned Collector of Sales Tax is satisfied that the applicant
is liable to be de-registered, he shall direct him to furnish a final
return in respect of his taxable activity.
(5) The final return, submitted under section
28 of the Act, shall be examined and if the concerned Collector of Sales
Tax is satisfied that the applicant has settled his tax liability, he shall
be de-registered within the period specified under sub-section (1) or
section 21 of the Act.
(6) In case the applicant is to be
de-registered due to cessation of business or his supplies are no longer
chargeable to tax, he shall be de-registered from such date as may be
determined by the concerned Collector or Sales Tax but not later than the
period specified under sub-section (1) of section 21 of the Act.
(7) In case a manufacturer seeks
de-registration on the ground that his turnover has fallen below one
million rupees he shall be de-registered from the beginning of next
financial year in accordance with sub-section (2) of section 21 of the Act.
(8) A person liable to be de-registered under
clause (d) of sub-rule (1) shall be served with a show cause notice asking
to explain as to why he should not be de-registered after giving him an
opportunity of being heard, the concerned Collector of Sales Tax may
de-register him without prejudice to any other action which may be taken
under any other provision of the Act.