40. Collection of tax.
(1) No person, who is not a registered dealer, shall collect any amount by way of tax or purporting to be by way of tax under this Act; and no registered dealer shall make any such collection except in accordance with the provisions of this Act and the rules made there under:
Explanation.- For the purposes of sub-section (1), any State Government or the Central Government, or any dealer shall be deemed to be a registered dealer.
(2) If any person or registered dealer collects any amount by way of tax or purporting to be by way of tax, in contravention of the provisions of sub-section (1), whether or not any tax is due from such person or dealer under this Act in respect of the transaction in which he collects such amount, the assessing authority may, after giving such person or dealer a reasonable opportunity of being heard, by order, in writing, impose upon him by way of penalty a sum, which shall be, -
(i) where the excess amount has been collected in the bona fide belief that it had to be collected, one hundred per cent of the amount collected;
(ii) where the excess amount has been collected wilfully and knowing that it was not due to be collected, one hundred and fifty per cent of the amount collected: Provided that no proceedings under this sub-section shall be commenced after a period of 1 [six years from the date of assessment:]: Provided further that no prosecution for an offence under sub-section (2) of section 71 shall be instituted in respect of the same facts on which a penalty has been imposed under this sub-section. |