The Nagaland Sales Tax (6th Amendment) Act,1989

THE NAGALAND SALES TAX (SIXTH 
AMENDMENT) ACT 
 
(THE NAGALAND ACT NO. 7 OF 1989) 
 
Received the assent of the Governor of Nagaland on 30th June’89 
and published in the Nagaland Gazette extraordinary dated 
30th June’89. 
 
 
An 
 
Act 
 
further to amend the Nagaland Sales Tax Act, 1967. 
It is hereby in the Fortieth year of the Republic of India, as 
follows 
1. Short Title, extent and commencement 
 (1) This act may be called the Nagaland sales tax (sixth Amendment) Act, 1989. 
(2) It shall extend to the whole of the State of Nagaland. 
    (3) It shall be deemed to have come into force on the 1st day of July, 1989. 
 
2: In the Nagaland Sales Tax Act, 1967, 
(I)  In section 2, 
(a) for clause (2), the following shall he substituted namely 
(2) “Works contract” means any agreement for carrying out or executing for cash, deferred payment or other valuable con-
sideration. 
(i) the construction, fitting out, improvement or repair of 
any building, road, wall, bridge, embankment, dam or other immovable property, or 
(ii) the assembling, fabrication, installation, repair, fitting out, altering, ornamenting, blending, finishing, improving 
processing, treating or adapting any movable property or not and includes a sub-contract for carrying out or 
executing -the whole or any part of such work. 
(b)     after clause (2) as so substituted, the following shall he inserted as clauses (2a) an d(2h) namely “(2a) “contracted means any 
person for whom or for whose benefit a works contract is carried out or executed; (2b) “contractor” means the person carrying out or 
executing a works contract”. 
 (c) for clause (3) and the Explanation thereunder, the following shall be substituted namely 
 
(3) “Dealer” means any person who carries on the business of buying, selling, supplying or distributing goods or delivering goods on 
hire purchase or on any system of payment buy installments or of carrying out or execution any works contracts or of transferring 
the right to use any goods for any purpose, whether for crash, deferre4 payment, commission, remuneration or other valuable 
consideration in the State and includes Government and any society, club or association which sells or supplies goods to its 
members, 
 
 
 
 
 
Explanation 
The manager or agent of a dealer who resides outsides the state and carries on business as a foresaid in the State shall in 
respect of such business be deemed to be a dealer for the purposes of this Act. 
(d) for clause (11), the following shall be substituted, namely: 
(1) “sale” with all its grammatical variations and cognate expressions means any transfer of property in goods for cash, deferred 
payment, commission, remuneration or other valuable consideration and includes. 
(a) any delivery of goods on hire purchase or any system of payment of installments. 
(b) any transfer of property in goods (whether as goods or in some other form) involved in the execution of a works 
contract specified in Schedule III 
(c) any transfer of the right to use any goods specified in Schedule IV for any purpose (whether or not for a specified 
period); 
(d) and shall be deemed always to have included any supply by way of or as part of any service or in any other manner 
what so ever, of goods, being food or any other article for human consumption or any drink (whether or not 
intoxicating) where such supply or service is for cash, deferred payment or other valuable consideration, and such 
delivery, transfer or supply of any goods shall he deemed to he and. in a case falling under sub- clause 
(d) of this clause, shall always be deemed to have 
a sale of such goods by the person making the delivery transfer or supply and a purchase of such goods by the 
person to whom such delivery, transfer or supply is made; 
 
Explanation (1): 
Save as provided in this clause, “sale” does not include any transfer of goods by way of a mortgage, hypothecation, charge or 
pledge or the resumption of procession of the goods by the transfer or under an agreement of hire- purchase or any system of 
payment by instalment. 
 
Explanation (2): 
A sale falling under sub-clause (a) shall be deemed to have taken place in the State if the goods are within the State at the time 
of their delivery. 
 
Explanation (3) 
A sale falling under sub-clause (b) shall be deemed to have taken place within the State if the goods involved in the works 
contract are within the State at the time of their use, application or appropriation for the execution of the contract. 
 
Explanation (4) 
.A sale falling under sub-clause (c) shall be deemed to have taken place in the State if the goods had not been purchased 
inside the State by the person transferring the right to use the goods irrespective of the place or places where the contract for 
such transfer is made or the goods are delivered for use or are actually used or except where the goods are intended to be 
exclusively used in another State in which case the sale shall be deemed to have taken place in such other State. 
 
Explanation (5): 
Transfer of the right to use any goods means the transfer by the owner of the goods of the possession or control or use of the 
goods specified in Schedule IV to any other person for any purpose, whether or not for a specified period, for cash, deferred 
payment or other valuable consideration; 
(e) For clause (2), the following shall he substituted, namely : 
 
(12) ‘sale price” shall mean and, in a case not falling under sub-clauses (a), (h) or (c) of clause) 11 of this section, shall be
deemed always to have meant the amount payable to a dealer in valuable consideration for the sale or supply of any goods, less 
any sum allowed as cash discount according to ordinary trade practice, but including any sum charged for anything done by the 
dealer with or in respect of the goods at the time of, or before delivery thereof, other than the cost of freight or delivery or the cost of 
installation where such cost is separately charged and includes 
 (a) in respect of any sale falling under sub-clause (a) of clause 
  (11) of this section, the full value of the consideration payable 
  had the goods been sold out-right on the day the goods were 
  delivered on hire-purchase or any system of payment by 
  instalments; - 
 (b) in respect of any sale falling under sub-clause (b) of clause 
  (11) of this section, the full value of the consideration received 
  or receivable under the contract for the transfer of property 
  in goods involved therein (whether as goods or in any other 
  form) including— 
(i) in a case where any goods have been supplied to the contractor by the contract or any other person for use in the 
works contract, whether for consideration or otherwise, the market value of the goods on the day they were so 
supplied; and 
(ii) in a case where any part of the work is carried out or executed - by sub-contractor, the amount received or receivable 
by such sub-contractor; 
 (c) in respect of any sale falling under sub-clause (c) of clause (11) of this section, the full value of the consideration received 
or receivable for the transfer of the right to use any goods for any purpose. 
 
Explanation (I) 
Where there are several contracts relating the same work or which are incidental or ancillary to each other all such contracts 
shall, for all purpose of the aforesaid sub-clause (b), be deemed to constitute a single contract. 
 
Explanation (2): 
For the purpose of the aforesaid sub-clause (b) the transfer of property in the goods involved in a works contract (whether as 
goods or in some other form) shall he deemed to have taken place at the time and to the extent the whole or any part of the 
safe price or any advance towards the sale price under the contract is received or becomes receivable by the dealer; 
 
(I) after clause (4) the following shall be inserted as clause (14 
A) namely 
(14 A) “turnover of sales” means  
(a) in relation to sales falling under sub-clause (b) of clause 
(ii) of this Section, the aggregate of the amounts of sale price received or receivable by the dealer during any period in 
respect of the carrying out or execution of a works contract whether executed fully or partly including any advance 
received or receivable by the dealer during that period towards the sale price hut excluding any amount refunded or 
refundable by the dealer or withheld from any payment made to him by way of discount, rebate, penalty, damages or 
otherwise in respect of such contract and reduced by 
(i) such percentage of the turnover towards labour and other charges as may he specified in Schedule Ill; and (ii) such 
other amounts as may be prescribed; 
 
(b) in relation to sales falling under sub-clause (c) of clause (11) of this section, the aggregate of the amounts of sale price 
received or receivable during any period by the dealer in respect of the transfer of the right to use any goods for any 
purpose, including any advance received towards the sale price during that period.” 
(iii) in section 4, after sub-section (7), the following shall be inserted as sub-section (8), (9), (10) and (II), namely- 
(8) Nowwithstanding anything contained else where in this section or any other law for the time being in force every dealer shall he 
liable to pay tax under this Act in respect of every sale falling under sub clause (h) or (c) of clause (II) of section 2 if his turnover 
of sales in any year commencing on the 1st day of July, 1989 or thereafter exceeds the taxable quantum” specified in sub-
section (11) of this section and he shall he so liable to pay tax on the expiry of one month from the date on this section and he 
shall he so liable to pay tax on the expiry of one month from the date on which such turnover first exceeds the taxable quantum 
on all sales   specified   in   this    sub-section   and    effected     after such    expiry,    and to that 
extent the provision of sub- section (1) to (7) of this section shall not apply to such dealer, (9) Every dealer who has become 
liable to pay tax under sub-section (8) of this section shall continue to be so liable until the expiry of three consecutive years 
during each of which his turnover of sales has failed to amount to or exceed the “taxable quantum” specified in sub-section (11) 
of this section and on expiry of this period, his liability to pay tax under the aforesaid sub-section shall cease. 
 
(10) Every dealer whose liability to pay tax under sub-section 
 
(8) of this section has ceased under sub-section (9), shall again be liable to pay tax under sub-section (8) of this section in 
occordance with that sub-section after his turnover of sales exceeds the “taxable quantum” specified in sub-section (11) again 
during any year. 
(11) For the purpose of sub-section (8) of this section “taxable quantum” means 
(a) in relation to sales falling under sub-clause, (b) of clause (II) of section 2, Rs. 50,000. 
(b) in relation to sales falling under sub-clause (c) of clause (11) of section 2, Rs. 10.000 
 
  (iv) after section 4, the following shall be inserted as section 4A, namely 
          Additional tax on turnover 4A(1) Notwithstanding anything contained elsewhere in this Act or in any other law for the time        
being in force. 
 
(a) every dealer whose gross turnover during the last year ending on or before the 30th day of June, 1989 exceeds rupees 
five làkhs, shall, in addition to any other tax payable by him under this Act or any other law for the time being in force, he 
liable to pay from the lst-day of July, 1989 a turnover tax at the rate specified in sub-section (3) of this section on such 
part of his turnover as specified in sub-section (2), 
(b) every other dealer whose gross turnover during any year ending after the 1st day of July, 1989, exceed rupees five lakhs 
shall, in addition to any other tax payable by him under this Act or any other law for the time  being  in  force, be  liable  to 
pay from the first day of the year immediately following  such  year   a turnover tax at the rate specified in sub-section(3) 
of this section on such part of his turnover as specified in sub-section (2); 
        (c)     every dealer who has become liable to pay turnover tax under clause (a) or clause (b) of this sub-section shall continue     
to be so liable until the expiry of three consecutive years during each of which his gross turnover does not exceed rupees 
five lakhs and on the expiry of such period of three years his liability to pay turnover tax shall cease; 
       (d)      every dealer whose liability to pay turnover tax has ceased under clause (c) of this sub-section, shall, if his gross     
turnover during any year again exceeds five lakhs, be liable to pay from the first day of the year immediately following 
such year turnover tax at the rate specified in sub-section (3) of this section on such part of his turnover as specified in 
sub- section (2) 
 
(2) The turnover tax shall be levied at the rate specified in sub-section (3) of this section on that part of the gross turnover of the 
dealer during any period which remains after deducting therefrom his turnover during the period on- 
(a) sales of goods specified in section 14 of the Central Sales Tax Act, 1956 (Central Act, 74 of 1956); 
(b) sales of goods exempted by or under Section 7; 
(c) sales of goods exempted under clause (b) and (c) of sub- section (1) of section (14); 
  (d) sales of goods in respect of which he is not required to pay tax under the Nagaland (Sales of Petroleum and Petroleum 
Products, including Motor Spirit and Lubricants) 
 
 
Taxation Act, 1967. 
(e) sales of goods taking place in the course of inter State 
trade or commerce or out-side the State or in the course 
of import or export as contemplated in sections 3, 4 and 
5 of the Central Sales Tax Act, 1976 (Central Act 74 of 
1956) 
(3) The turnover tax shall be levied at the rates specified below if the gross turnover of the dealer liable to pay such tax during the 
period in respect of which or part of which turnover tax is levied fulfils the condition specified against each: 
 
 - Rate of Tax Turnover Limits 
(a) One and one-half of one per centum If gross turnover exceeds 
 rupees ten lakhs. 
(b) One per centum If gross turnover exceeds 
 rupees five lakhs but does 
 not exceeds ten lakhs. 
 
Explanation; 
For the purpose of sub-sections (2) and (3) of this section period means the period prescribed under section 15. 
(4) The tax payable by a dealer under sub-section (3) of this section in respect of any period shall not exceed 
(a) in a case falling under clause (a) of sub-section (3) of this section, a sum equivalent to the aggregate of two thirds of 
the tax payable in accordance with the said clause (a) and fifteen per centum of the amount by which his gross 
turnover for the period exceeds rupees ten lakhs, and 
(b) in a case falling under clause (h) of the said subsection (3), a sum equivalent to the aggregate of one half of the tax 
payable in accordance with the said clause (b), and ten per centum of the amount by which his gross turnover for the 
period exceeds rupees five lakhs. 
 
(5) No dealer shall realise from his purchase the turnover tax payable by him under this section: 
(v) in section 5. 
(a) in sub-section (1), between the words “shall” and “be”, the following shall be inserted, namely : “Subject to sub-
section (3)”. 
(b) after sub-section (2), the following shall be inserted as sub-section (3) namely: (3) The tax payable by a dealer 
under the Act, in respect of sales falling under sub-clauses (b) and (c) of clause (12) of section 2. Shall be at the 
rates specified in Schedules III and IV respectively”. 
(vi) in Section 6. 
(a) after the word “dealer”, the following shall he inserted, namely 
“and in case of sales falling under clauses (h) and (c) of sub-clause (11) of section 2, on the turnover of sales of a 
dealer making such sales”. 
 
(vii) in section (14) in sub-section (1), in clause (b), for sub-clause (i), the following shall be substituted, namely 
“(i) goods specified in the purchasing dealer’s certificate of 
registration as being intended by him for resale in the State”. 
(viii) after Schedule lithe following shall be inserted as Schedules 
III and IV namely; 
 
 
 
 
SCHEDULE Ill 
 
List of Works contracts for Charge of Tax on Transfer of Property in Goods Involved Therein. (See section 2 (11) (b) 
Si. Description of works contract. * Rate of -tax 
No. 
 (1) (2) (3) (4) 
1. Fabricatiou and installation of 10 4 paise in the 
 lifts, rolling shutters collapsible  rupees 
 and other varieties of gates, grills, 
 doors, windows and frames and 
 overhead tanks. 
 
2. Supply and fixing of tiles, slabs,       30            4 paise in the                                                               
 stone sheets, flooring, roofing,                                     rupees                                                                         
    sanitary and water fitting, drainage                                                                                                
  sewerage, construction of RCC                                                                                                        
  buildings and bridges 
* Percentage cf exclusion towards other charges. 
 
 
 
 
SCHEDULE IV 
 
List of Good for Charge Tax on Transferer of the Right to Use any Goods or any Purpose. 
 
See section 2 (11) (c) 
SI. Description of goods Rates of tax 
No. 
1. Video Cassettes and                      20 paisa in the rupee.                                                                         
 audio cassette 
 
 
2. Television sets, Video                     20 paise in the rupee. 
 cassettee recorders and 
 players and Video games 
 equipment. 
 
3. Internal communication                    20 paise in the rupee. 
 and closed Circuit TV 
 equipments – 
 
 

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