BENGAL MOTOR SPIRIT SALES TAXATION ACT, 1941

Act No. 05 of 1941

12th June, 1941

An Act to provide for the levy of a tax on retail sales of motor spirits in Bengal. Whereas it is expedient to further the construction of new roads in Bengal, and therefore to provide for the levy of a tax on retail sales of motor spirit in Bengal; It is hereby enacted as follows:- For Statement of Objects and Reasons, see the Calcutta Gazette, dated the 7th November, 1940, Part IVA, page 331; the Report of the Select Committee was presented to the Assembly on the 3rd February, 1941; for the Proceedings of the Bengal Legislative Assembly, see the Proceedings of the meetings, held on the 28th November, 1940 and 3rd and 4th February and 3rd April, 1941; for the Proceedings of the Bengal Legislative Council, see the Proceedings of the meetings, held on the 14th February, 4th, 10th and 11th March, 1941.

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S.1 Short title, extent and commencement

(1) This Act may be called the Bengal Motor Spirit Sales Taxation Act, 1941.

(2) It extends to the whole of 1[West Bengal].

(3) It shall come into force on such date2 as the 3State Government may, by notification in the Official Gazette, appoint.

1. The words within square brackets were substituted for the word "Bengal" by paragraph (2) of Article 3 of the Indian Independence (Adaptation of Bengal and Punjab Acts), Order, 1948.

2. This Act came into force on the 7th day of August, 1941, vide Notification No. 1911F., dated the 4th August, 1941, published in the Calcutta Gazette, dated the 7th August, 1941, Part I, page 1902.

3. The word "State" was substituted for the word "Provincial" by paragraph 4(1) of the Adaptation of Laws Order, 1950.

S.2 Definitions

In this Act, unless there is anything repugnant in the subject or context-

(a) "motor spirit" means any liquid or admixture of liquids which is ordinarily used directly or indirectly as fuel for any form of motor vehicle or stationary internal combustion engine, and which has a flashing point below 76 degrees Fahrenheit.

1Explanation.-For the avoidance of doubt, it is hereby declared that in this Act, the expression "vehicle" means any means of carriage, conveyance or transport, by land, air or water;

(b) "prescribed" means prescribed by rules made under this Act;
(c) "retail dealer" means any person who sells or keeps for sale motor spirit for the purpose of consumption by the purchaser;
(d) "retail sale" means a sale of motor spirit by a retail dealer for the purpose of consumption by the purchaser;
(e) "wholesale dealer" means any person who sells motor spirit, or keeps motor spirit for sale, to retail dealers in

S.3 Levy of tax

(1) Except as otherwise expressed Provided in this Act there shall be charged and levied on all retail sales of motor spirit Effected after the 1[date2 of commencement of the Bengal Motto Spirit Sales Taxation (Amendment) Act, 1946, a tax at the rate of six annas per gallon; and such tax shall be payable to the 3State Government by the retail dealer:

4Provided that-

(i) the tax on all retail sales of motor sprit for the purpose of aviation, Which are effected on or after the date of the commencement of the Bengal Motor Spirit Sales Taxation (Second Amendment) Act, 1954 (West Ben. Act XXXII of 1954), shall be charged at the rate of three annas per gallon;
(ii) the tax payable in respect of motor spirit sold to a retail dealer and Used by such dealer for his own consumption shall be paid by such dealer.

(2) Where any retail dealers obtain their supplies of motor spirit from a wholesale dealer, the 3State Government may by agreement with the

S.4 No dealer to carry on business without a licence

(1) No person shall, after the commencement of this Act, carry on business in motor spirit as a wholesale or retail dealer at any place except under a licence granted under this Act and in conformity with the conditions of such licence:

Provided that persons carrying on such business at the commencement of this Act shall be allowed two months from such commencement to obtain such licence.

(2) Where a retail dealer has more than one place of business, whether in the same district, village or town or in different districts, villages or towns, he shall obtain a separate licence in respect of each such place of business.

(3) No wholesale dealer shall, except under a licence granted under this Act for carrying on business in motor spirit as a retail dealer sell motor spirit for consumption or sale in 1[West Bengal] to any person other than a wholesale or retail dealer, possessing a licence under this Act.

(4) Application for licence under this Act for carryin

S.5 Retail dealers to keep books of account and submit returns

Every retail dealer shall in respect of his business at each place where he carries on business-

(a) keep books of account in the prescribed form; and
(b) submit every month to such authority as may be prescribed a correct return in the prescribed form and by the prescribed date showing-

(i) the quantity of motor spirit received by him during the preceding month;
(ii) the quantity sold by him during such month;
(iii) the quantity consumed by him out of his own stock of motor spirit during such month; and
(iv) such other particulars as may be prescribed.

S.6 Payment of the tax and receipt for such payment

Before submitting the return referred to in clause (b) of section 5 in each month, the-retail dealer shall pay into a Government treasury or the Reserve Bank of India, the full amount of the tax due under this Act in respect of the motor spirit sold by him in retail or consumed by him out of his own stock during the preceding month according to such return, and furnish along with the return a receipt from such treasury or Bank showing payment of such amount.

S.7 Determination of the amount of tax by the prescribed authority in certain cases

(1) If no return is submitted by a retail dealer under clause (b) of section 5 in respect of any month by the prescribed date in that behalf, or if the return is submitted without a receipt showing payment of the full amount of the tax due as required by section 6 or if the return submitted appears to the authority referred to in clause (b) of section 5 to be incorrect or incomplete, such authority shall, after making such inquiry, if any, as it considers necessary, determine the amount of the tax due from such retail dealer in respect of such month and the amounts so determined less the sum, if any, already paid by him shall be paid by the retail dealer into a Government treasury or the Reserve Bank of India within fourteen days 1[from the date of service in the prescribed manner of notice of demand therefor to be issued by the authority]:

Provided that before the prescribed authority determines under this sub-section the amount of the tax due, the retail dealer shall be gi

S.8 Refunds

The authority referred to in clause (6) of section 5 shall, in the prescribed manner, refund to a retail dealer applying in this behalf any amount of tax paid by such dealer in excess of the amount due from him under this Act, either by cash payment or, at the option of the dealer, by deduction of such excess from the amount of tax due in respect of any subsequent return.

S.9 Wholesale dealer to keep books of account and submit returns

Every wholesale dealer shall submit every quarter to such authority as may be prescribed, a correct return in the prescribed form and by the prescribed date showing-

(i) the quantities of motor spirit supplied by him during the preceding quarter to retail dealers in 1[West Bengal], specifying the name and address of each retail dealer, the quantity supplied to him and the dates on which the supplies were made; and
(ii) such other particulars as may be prescribed.

1. See foot-note 2 on page 237, ante.

S.10 Transfer of business

(1) No person carrying on business in motor spirit as a wholesale or retail dealer shall sell or otherwise dispose of such business or any part thereof except to a person possessing an appropriate licence under this Act to carry on such business.

(2) If any person carrying on any such business sells or otherwise disposes of such business or any part thereof, he shall within fourteen days inform the prescribed authority accordingly; and if any such person dies, his legal representative shall in like manner inform the said authority.

(3) If any person carrying on any such business dies, his legal representative shall either-

(a) apply within thirty days for an appropriate licence under this Act to carry on the business; or
(b) sell or otherwise dispose of the business within thirty days to a person possessing an appropriate licence under this Act to carry on the business; or
(c) dispose of the stocks of motor spirit, in respect of the sale

S.11 Powers of inspection, entry and search

(1) Any person empowered by the 1State Government in this behalf may, for the purposes of this Act,-

(a) require any wholesale or retail dealer to make available for inspection at the ordinary place of business of the dealer all accounts, vouchers and other documents relating to stocks, purchases, sales and deliveries of motor spirit, or to furnish any other information relating thereto, and every such wholesale and retail dealer shall comply with such requisition; and
(b) inspect such accounts, vouchers and documents of, and the motor spirit stocked by, any wholesale or retail dealer.

(2) For the purpose of sub-section (1) any such person specially empowered by the 1State Government in this behalf may enter and search at any time by day any building, vessel, vehicle or place in which he has reason to believe that any wholesale or retail dealer carries on business or keeps any stock of motor spirit.

(3) All searches made under sub-section

S.12 Determination of certain questions by the prescribed authority

Any question as to whether a tax or penalty is recoverable under this Act, the person from whom it is due and the amount so recoverable shall be determined by the prescribed authority.

S.13 Returns, etc., to be confidential

Any question as to whether a tax or penalty is recoverable under this Act, the person from whom it is due and the amount so recoverable shall be determined by the prescribed authority.

S.14 Penalties

Any person who-

(a) carries on business in motor spirit as a wholesale or a retail dealer at any place except under a licence granted under sub-section (1) of section 4 or when the licence granted under that sub-section in respect of such place of business is no longer in force; or
(b) fails to keep books of account as required by clause (a) of section 5; or
(c) fails to submit any return as required by clause (b) of section 5 or by section 9 or submits a false return; or
(d) fraudulently evades the payment of any tax due under this Act; or
(e) neglects to furnish any information required by sub-section (2) of section 10 or acts in contravention of the provisions of that section; or
(f) refuses to comply with a requisition under clause (a) of sub-section (2) of section 11 or obstructs any officer making an inspection or a search under section 11; or
(g) discloses any information in contravention of the provisions of

S.15 Offences to be cognizable and bailable

All offences punishable under this Act shall be cognizable and bailable.

S.16 Power to compound offences

(1) Subject to such conditions as may be prescribed the prescribed authority may accept from any person charged with any offence punishable under this Act or any rule made thereunder, by way of composition for such offence, payment of a sum of money not exceeding five hundred rupees or double the amount of the tax payable, whichever is greater.

(2) If payment by way of composition is accepted under sub-section (2), the accused, if in custody, shall be discharged and no further proceedings shall be taken against him in respect of such offence.

S.17 Jurisdiction to try offences

(1) No Court shall take cognizance of any offence under this Act or the rules made thereunder except upon a complaint made with the previous sanction of the prescribed authority.

(2) No Court inferior to that of a Presidency Magistrate or a Magistrate of the second class shall try an offence punishable under this Act.

S.18 Officers to be deemed public servants

All persons empowered to perform any function under this Act shall be deemed to be public servants within the meaning of section 21 of the Indian Penal Code (Act XLV of 1860).

S.19 Indemnity

No suit, prosecution or other legal proceedings shall lie against any servant of the 1[Government] for anything which is in good faith done or intended to be done under this Act.

2 Provided that an appeal from an order under sub-section (1) of section 7, determining the amount of tax due from a retail dealer may be preferred within thirty days from the date of service of the notice of demand issued under that sub-section.

S.20 Appeal and revision

(1) Any person aggrieved by any order made under this Act or the rules made thereunder may appeal to the prescribed authority within thirty days from the date of such order:

(2) Every order passed in appeal under this section shall, subject to the powers of revision conferred by sub-section (3), be final.

(3) The prescribed authority may, at any time, either of its own motion or on application call for and examine the record of any order passed or the proceedings recorded by any officer or person subordinate to such authority, for the purpose of satisfying itself as to the legality or propriety of such order, or as to the regularity of such proceedings, and may pass such order in reference thereto as it thinks fit.

(4) Nothing in this section shall apply to the orders or proceedings of any Court or Magistrate.

S.21 Power to make rules

(1) The 1State Government may, subject to the condition of previous publication, make rules for carrying out the purposes of this Act.

(2) In particular, and without prejudice to the generality of the foregoing power, such rules may provide for all or any of the following matters, namely:-

(a) the form of application for licence under sub-section (4) of section 4 and the authority which may grant licences;
(b) the form of licence, the particulars to be contained therein and the conditions subject to which licences may be granted;
(c) the conditions subject to which licences may be suspended or cancelled;
(d) the forms in which books of account under clause (a) of section 5 are to be kept;
(e) the authority to which returns are to be submitted every month under clause (b) of section 5 and every quarter under section 9 and the forms of such returns and the date by which they are to be submitted and the additional particulars req

S.22 Imposition of tax on the sale or purchase of motor spirit

(1) Nothing in this Act shall be construed to, impose or authorize the imposition of a tax on the sale or purchase of motor spirit:-

(a) where the sale or purchase takes place outside the State of West Bengal;
(b) where the sale or purchase takes place in the course of the import of such motor spirit into, or export of such motor spirit out of the territory of India; or
(c) after the 31st day of March, 1951, where the sale or purchase takes place in the course of inter-State trade or commerce except in so far as Parliament may bylaw otherwise provided

(2) The Explanation to clause (1) of article 286 of the Constitution shall apply for the interpretation of clause (a) of the section (1).

1. This new section 22 was inserted by paragraph 3 of, and the Eleventh Schedule to, the Adaptation of Laws Order, 1950.