The West Bengal Finance Act, 1998

GOVERNMENT OF WEST BENGAL 
LAW DEPARTMENT 
Legislative 
Ben. Act V 
of 1922. 
Ben. Act X 
of 1935. 
Ben. Act IV 
of 1944. 
West Ben. 
Act VI of 
1982. 
West Ben. 
Act XLIX of 
1994. 
West Bengal Act III of 1998 
THE WEST BENGAL FINANCE ACT, 1998. 
[Passed by the West Bengal Legislature.] 
[Assent of the Governor was first published in the Calcutta 
Gazette, Extraordinary, of the 1st April, 1998.] 
[1st April, 1998.] 
An Act to amend the Bengal Amusements Tax Act, 1922, the Bengal 
Electricity Duty Act, 1935, the Bengal Agricultural Income-tax Act, 
1944, the West Bengal Entertainment-cum-Amusement Tax Act, 1982, 
and the West Bengal Sales Tax Act, 1994. 
WHEREAS it is expedient to amend the Bengal Amusements Tax Act, 
1922, the Bengal Electricity Duty Act, 1935, the Bengal Agricultural 
Income-tax Act, 1944, the West Bengal Entertainment-cum-Amusement 
Tax Act, 1982, and the West Bengal Sales Tax Act, 1994, for the purposes 
and in the manner hereinafter appearing; 
It is hereby enacted in the Forty-ninth Year of the Republic of 
India, by the Legislature of West Bengal, as follows:- 
1. (1) This Act may be called the West Bengal Finance Act, 1998. Short title 
and 
commence- 
(2) This section, section 3, section 4 and section 5 shall come into ment. 
force, and shall be deemed to have come into force, on the 1st day of April, 
1998; section 2 shall come into force, and shall be deemed to have come 
into force, on the 1st day of April, 1997; clause (3), clause (5), clause (15), 
clause (25), clause (26), clause (27), clause (28), clause (29), clause (30), 
clause (31), and clause (32), of section 6 shall come into force on such date 
as the State Government may, by notification, appoint, and different dates 
may be appointed for such different clauses of section 6, and the remaining 
clauses of section 6 shall come into force, and shall be deemed to have 
come into force, on the 1st day of April, 1998. 
51 
The West Bengal Finance Act, 1998. 
[West Ben. Act 
(Sections 2-3.) 
Amendment 
of Ben. Act 
V of 1922. 
Amendment 
of Ben. Act 
X of 1935. 
2. In the Bengal Amusements Tax Act, 1922,— 
(1) in section 8A, after sub-section (2), the following sub-section 
shall be added:— 
"(3) Where— 
(a) any proprietor in relation to any entertainment, 
other than horse racing and cinematograph 
exhibition, has not obtained any prior permission 
from the prescribed authority before holding any 
entertainment, or 
(b) any proprietor referred to in clause (a) has not 
furnished any particulars to the prescribed authority 
as required under the provisions of this Act or the 
rules made thereunder, or 
(c) upon enquiry or information received, the prescribed 
authority has reasons to believe that the proprietor 
referred to in clause (a) has furnished incorrect 
particulars at the time of obtaining permission 
from the prescribed authority to hold any 
entertainment referred to in this sub-section, 
the prescribed authority shall, in such manner as may be 
prescribed, proceed to assess to the best of his judge-
ment the amount of entertainment tax payable by such 
proprietor after giving such proprietor a reasonable 
opportunity of being heard, and direct such proprietor to 
pay the amount of tax so assessed in such manner and 
by such date as may be prescribed."; 
(2) in section 9, in sub-section (2), after the words "cinemato-
graph exhibition", the words, letter, figures and brackets "or 
to a proprietor referred to in sub-section (3) of section 8A" 
shall be inserted; 
(3) in section 11E, in sub-section (1), after the words "cinemato-
graph exhibition", the words, letter, figures and brackets "or 
any proprietor referred to in sub-section (3) of section 8A" 
shall be inserted. 
3. In the Bengal Electricity Duty Act, 1935, in section 3A, in sub-
section (3), in clause (b), for the words, figures and letters "after the 31st 
day of December, 1998, whichever is later.", the words, figures and 
letters "after the 31st day of December, 2000, whichever is later." shall 
be substituted. 
52 
The West Bengal Finance Act, 1998. 
III of 1998.] 
(Section 4.) 
4. In the Bengal Agricultural Income-tax Act, 1944,— 
(1) in section 26D, in sub-section (1), for the words "the first day 
of January in the financial year in which the advance tax 
was payable", the words "the first day of the month next 
following the prescribed date of payment of the last instal-
ment of the advance tax" shall be substituted; 
(2) in section 26E,— 
(a) in sub-section (1), for the words "the first day of January 
in the financial year in which the advance tax was 
payable", the words "the first day of the month next 
following the prescribed date of payment of the last 
instalment of the advance tax" shall be substituted; 
(b) in sub-section (2), after the word and figures 
"section 37,", the word, figures and letter "section 38A," 
shall be inserted; 
(c) for sub-section (3), the following sub-section shall be 
substituted:— 
"(3) The Commissioner, or such other authority 
appointed under section 21 as may be prescribed, may, 
in such cases and under such circumstances as may be 
prescribed, reduce or waive the interest payable by the 
assessee under this section or under section 26D,"; 
(3) in section 38A,— 
(a) for the figure, word and brackets "(1) Where", the word 
"Where" shall be substituted; 
(b) after the proviso, the following Explanation shall be 
inserted:— 
'Explanation.—For the removal of doubt, it is hereby 
declared that where an Agricultural Income-tax Officer 
is required to modify an order in respect of any assess-
ment, the expression "in respect of assessment" 
in this section shall mean an assessment relating to 
the year in which modification is required to be made 
in accordance with the order passed by an authority 
specified in sub-section (3) of section 8, and shall 
include assessment in respect of any subsequent year 
which is required to be modified in order to give effect 
to such modification.'; 
(4) in section 44, in sub-section (la), in the proviso, after the 
word and figures "section 37,", the word, figures and letter 
"section 38A," shall be inserted. 
Amendment 
of Ben. Act 
IV of 1944. 
53 
The West Bengal Finance Act, 1998. 
[West Ben. Act 
(Section 5.) 
Amendment 
of West Ben. 
Act VI of 
1982. 
5. In the West Bengal entertainment-cum-Amusement Tax Act, 
1982,— 
(1) in section 2, after clause (c), the following clause shall be 
inserted:— 
`(cc) "registered" means registered under section 5A;'; 
(2) in section 4A, for sub-section (4a), the following sub-sections 
shall be substituted:— 
`(4a) Where any owner, or any person for the time being 
in, of any electrical, electronic or mechanical device, is a 
cable operator and receives through such device the signal of 
any performance, film or any other programme telecast, and 
thereafter such owner or person, against payment received 
or receivable,— 
(i) exhibits such performance, film or programme 
through cable television network directly to customers, 
or 
(ii) transmits such signal to a sub-cable operator, who 
in turn provides cable service for exhibition of such 
performance, film or programme to the customers, 
such owner or person shall be liable to pay tax from the month 
in which he exhibits such performance, film or programme 
or transmits such signal to a sub-cable operator on the basis 
of his monthly gross receipt at such rate, not exceeding 
twenty-five per centum of the monthly gross receipt, as 
may be specified by the State Government by notification 
published in the Official Gazette: 
Provided that where,— 
(a) a holder of a video cassette recorder set or a holder of a 
video cassette player set, who is liable to pay tax under 
sub-section (4), also functions as a cable operator 
and transmits simultaneously the performance, film or 
programme through the same cable referred to in sub-
section (4) and thereby becomes liable to pay tax under 
this sub-section, or 
(b) an owner or person, who is a cable operator and is liable 
to pay tax under this sub-section, also becomes a holder 
of a video cassette recorder set or a video cassette player 
set and transmits simultaneously the performance, film 
or programme through the same cable television network 
referred to in this sub-section and thereby becomes 
liable to pay tax under sub-section (4), such holder of a 
video cassette recorder set or a video cassette player set, 
54 
The West Bengal Finance Act, 1998. 
III of 1998.] 
(Section 5.) 
or an owner or person who is a cable operator, shall be liable 
to pay tax under this sub-section only and not under sub-
section (4). 
Explanation.—For the purposes of this sub-section,---- 
(a) "cable operator" means any person who provides cable 
- service directly to customers or transmits signal to a 
sub-cable operator through a cable television network 
and otherwise controls or is responsible for the 
management and operation of a cable television network; 
(b) "sub-cable operator" means a person, other than any 
owner or person who is a cable operator referred to in 
this sub-section, who, on the basis of an agreement, 
contract or any other arrangement made between him 
and such cable operator, receives signal from such cable 
operator and provides cable service for exhibition of 
performance, film or any programme to the customers; 
(c) "cable service" means transmission or re-transmission 
of programmes including broadcast television channel 
signals or satellite television channel signals or both 
through cables or by any other means; 
(d) "cable television network" means any system consisting 
of a set of closed transmission paths and associated 
signal generation, control and distribution equipment, 
designed to provide cable service for reception by 
multiple customers; 
(e) "gross receipt", in relation to any month or part thereof, 
shall mean the aggregate of amounts received or 
receivable by an owner, or a person for the time being 
in possession, of any electrical, electronic or mechanical 
device who exhibits any performance, film or any other 
programme through cable television network directly to 
customers or who transmits the signal for exhibition of 
any performance, film or any other programme telecast 
to a sub-cable operator. 
(4b) The prescribed authority shall, after making such 
enquiry as he may think necessary and after giving the owner 
or the person, referred to in sub-section (4a) of section 4A, a 
reasonable opportunity of being heard, fix the date on and 
from which such owner or person shall become liable to pay 
tax under the said sub-section.'; 
55 
The West Bengal Finance Act, 1998. 
[West Ben. Act 
(Section 5.) 
(3) in section 5, in sub-section (4), the words, figure, letter and 
brackets "or any owner or person liable to pay tax under sub-
section (4a) of that section" shall be omitted; 
(4) after section 5, the following sections shall be inserted:— 
"Registration 	 5A. (1) Every cable operator referred to in of cable 
operator. 	 sub-section (4a) of section 4A who is liable to 
pay tax under that sub-section shall get himself registered with 
the prescribed authority in the prescribed manner within 
ninety days from the end of the month in which he has become 
liable to pay tax under the said sub-section or within ninety 
days from the date of coming into force of section 5 of the 
West Bengal Finance Act, 1998, whichever is later. 
(2) If a cable operator fails to get himself registered within 
the time specified in sub-section (1), the prescribed authority 
may, after giving such cable operator a reasonable opportunity 
of being heard, impose a penalty of a sum not exceeding five 
hundred rupees for each month of default. 
(3) No penalty under sub-section (2) shall be imposed in 
respect of the same fact for which prosecution under clause (c) 
of sub-section (1) of section 11A has been initiated and no 
such prosecution shall lie in respect of a fact for which a 
penalty under sub-section (2) of this section has been imposed. 
Periodical 	 5B. (1) Every cable operator registered 
returns and 	 under this Act shall furnish a return to the payment of tax 
by registered 	 prescribed authority for each month showing 
cable operators. 	 his gross receipt and the amount of tax payable 
thereon in the prescribed manner within such time as may be 
prescribed. 
(2) Before a cable operator furnishes a return referred to 
in sub-section (1), he shall, in the prescribed manner, pay into 
a Government Treasury or the Reserve Bank of India the full 
amount of tax due from him in respect of a month as per such 
return, and shall enclose along with such return a-receipt from 
the Treasury or the Reserve Bank of India in proof of payment 
of such amount. 
Assessment of 	 5C. If no return is furnished by a cable tax payable by 
registered cable 	 operator registered under this Act in respect 
operator. 	 of any month of a year, or if the prescribed 
authority is not satisfied that the return furnished in respect of 
56 
The West Bengal Finance Act, 1998. 
III of 1998.] 
(Section 5.) 
any month of a year is correct and complete, the prescribed 
authority shall proceed in such manner as may be prescribed 
to assess the amount of tax due from such cable operator for 
such year, and in making such assessment, it shall give such 
cable operator a reasonable opportunity of being heard; 
and in the case of failure of such cable operator to 
furnish return for any month accompanied by a receipt as 
required under sub-section (2) of section 5B by the prescribed 
date, the prescribed authority may, if it is satisfied that the 
default was without any reasonable cause, direct that such 
cable operator shall pay by way of penalty, in addition to the 
amount of tax assessed, a sum not exceeding the amount of tax 
so assessed: 
Provided that no penalty under this section shall be imposed 
in respect of the same fact for which a prosecution under 
clause (a) of sub-section (1) of section 11A has been instituted 
and no prosecution shall lie vice versa. 
Assessment of 	 5D. If, upon information which has come tax payable 
by cable 	 into its possession, the prescribed authority is 
operator 	 satisfied that a cable operator liable to pay tax other than 	 under this Act in respect of any month of a year registered 
cable operator. has failed to get himself registered or has not 
been registered, the prescribed authority shall proceed in such 
manner as may be prescribed to assess to the best of its 
judgement the amount of tax due from such cable operator in 
respect of such year and all subsequent years and, in making 
such assessment, it shall give such cable operator a reasonable 
opportunity of being heard: 
Provided that no assessment under this section shall be 
made before the prescribed authority makes such enquiry as it 
may think necessary and, after giving the cable operator a 
reasonable opportunity of being heard, fixes the date on and 
from which such cable operator shall become liable to pay tax 
under sub-section (4a) of section 4A. 
Maintenance 	 5E. Every cable operator shall maintain of accounts, and keep true and up-to-date accounts and records, etc. 
records of gross receipts in respect of payments 
received or receivable for rendering cable service through 
cable television network and shall produce and explain such 
documents before the prescribed authority as and when 
required."; 
57 
The West Bengal Finance Act, 1998. 
[West Ben. Act 
(Section 5.) 
(5) in section 8, in sub-section (2),— 
(a) for the words "satellite transmission receiver including 
dish antenna with modulator or amplifier", the words 
"electrical, electronic or mechanical device which receives 
the signal of any performance, film or any other programme 
telecast" shall be substituted; 
(b) for the words "satellite transmission receiver with 
modulator or amplifier", the words "electrical, electronic 
or mechanical device" shall be substituted; 
(6) after section 9, the following section shall be inserted:— 
"Special mode 	 9A. (1) Notwithstanding any proceeding 
of recovery. 	 initiated under section 9 for recovery of any sum 
due on account of arrears of tax and penalty under this Act as 
an arrear of land revenue, the prescribed authority may, at any 
time or from time to time, by notice in the prescribed form, 
require any person from whom money is due or may become 
due to a holder of a video cassette recorder set or a video 
cassette player set liable to pay tax under section 4 or section 
4A, as the case may be, or to an owner or person liable to pay 
tax under sub-section (4a) of section 4A (hereinafter referred 
to as the defaulter), or require any person who holds or may 
subsequently hold money for or on account of such defaulter, 
to deposit into a Government Treasury or the Reserve Bank of 
India under the appropriate head of account, either forthwith 
upon the money becoming due or being held or at or within the 
time specified in the notice (not being before the money 
become due or is held), so much of the money as is sufficient 
to pay the amount due from such defaulter in respect of the 
arrears of such tax or penalty, or the whole of the money when 
it is equal to, or less than, the amount due. 
(2) A notice under this section may be issued to any person 
who holds or may subsequently hold any money for, or on 
account of, the defaulter jointly with any other person and, for 
the purposes of this section, the shares of the joint-holders in 
such account shall be presumed, until the contrary is proved, 
to be equal. 
(3) A copy of the notice shall be forwarded to the defaulter 
at his last address known to the prescribed authority and, in the 
case of a joint account, to all the joint-holders at their last 
addresses known to the prescribed authority. 
58 
The West Bengal Finance Act, 1998. 
III of 1998.] 
(Section 5.) 
(4) Save as otherwise provided in this section, every person 
to whom a notice is issued under this section shall be bound to 
comply with such notice, and, in particular, where any such 
notice is issued to a post office, banking company or insurer, 
it shall not be necessary for any pass book, deposit receipt, 
policy or any other document to be produced for the purpose 
of any entry, endorsement or the like being made before 
payment is made, notwithstanding any rule, practice or 
requirement to the contrary. 
(5) Any claim with respect to any money which is due or 
to become due or is being held or may subsequently be held 
and in relation to which a notice under this section has been 
issued, arising after the date of such notice, shall be void as 
against any demand contained in such notice. 
(6) Where a person to whom a notice under this section is 
sent proves to the satisfaction of the prescribed authority that 
the sum demanded or any part thereof is not due to the 
defaulter or that he does not hold any money for, or on account 
of, such defaulter or that the money demanded or any part 
thereof is not likely to be due to such defaulter or be held for, 
or on account of, the defaulter, then, nothing contained in this 
section shall be deemed to require such person to deposit any 
such sum or part thereof, as the case may be. 
(7) The prescribed authority may, at any time, or from time 
to time, amend or revoke any notice issued under this section 
or extend the time for making any payment in pursuance of 
such notice. 
(8) The Government Treasury or the Reserve Bank of 
India shall grant a receipt for any amount paid in compliance 
with a notice issued under this section, and the person so 
paying the amount shall be fully discharged from his liability 
to the defaulter to the extent of the amount so paid. 
(9) Any person discharging any liability to the defaulter 
after receipt of a notice under this section shall be personally 
liable to the prescribed authority to the extent of his own 
liability to such defaulter so discharged or to the extent of the 
liability of such defaulter for any amount due under this Act, 
whichever is less. 
(10) If the person to whom a notice under this section is 
sent fails to make payment in pursuance thereof, he shall also 
be deemed to be a defaulter in respect of the amount specified 
in the notice, and further proceedings may be taken against 
such person for the recovery of the amount as if it were an 
arrear due from him, and the notice shall have the same effect 
as attachment of a debt. 
59 
The West Bengal Finance Act, 1998. 
[West Ben. Act 
(Section 5.) 
(11) The prescribed authority may apply to the court in 
whose custody there is money belonging to the defaulter for 
payment to him of the entire amount of such money or, if it is 
more than the amount of tax due, or penalty due, such amount 
as is sufficient to discharge the liability of the amount of tax 
or penalty due: 
Provided that any dues exempt from attachment in 
execution of a decree of a civil court under section 60 of the 
Code of Civil Procedure, 1908, shall be exempt from any 5 of 1908. 
payment required to be made under this section."; 
(7) after section 11, the following section shall be inserted:— 
"Offences and 	 11A. (1) Whoever being liable to pay tax 
penalties. 	 under sub-section (4a) of section 4A,— 
(a) fails to pay for more than three months the full amount 
of tax payable in accordance with the provisions of sub-
section (2) of section 5B, or 
(b) submits wilfully false declaration under sub-section (5) 
of section 4A, or 
(c) contravenes the provisions of sub-section (1) of 
section 5A, 
shall be punishable with simple imprisonment which may 
extend to six months or with fine not exceeding one thousand 
rupees or with both, and when the offence is a continuing one, 
with a daily fine not exceeding one hundred rupees during the 
period of continuance of the offence. 
(2) Whoever obstructs or tries to prevent the prescribed 
authority or any person appointed under sub-section (2) of 
- section 3 from searching any building, premises or place in 
accordance with the provisions contained in sub-section (1), 
or sub-section (2), of section 8 shall be punishable with simple 
imprisonment which may extend to one year or with fine not 
exceeding five thousand rupees or with both. 
(3) No court shall take cognizance of any offence under 
this Act or the rules made thereunder except with the 
previous sanction of the prescribed authority, and no court 
inferior to that of a Metropolitan Magistrate or a Judicial 
Magistrate shall try any such offence. 
(4) All offences under this Act shall be cognizable and 
bailable.". 
60 
The West Bengal Finance Act, 1998. 
III of 1998.] 
(Section 6.) 
6. In the West Bengal Sales Tax Act, 1994,— 
(1) in section 2, in clause (17),— 
(a) for the words "extracting or blending any goods", the 
words "extracting any goods" shall be substituted, and 
(b) after the words "as may be prescribed,", the words "and 
includes blending of tea," shall be inserted; 
(2) in section 3, in sub-section (4), for the words, figures 
and brackets "sub-section (4) of section 17", the words, 
figures and brackets "sub-section (4), or sub-section (5), of 
section 17" shall be substituted; 
(3) in section 11, sub-section (4), sub-section (5), sub-section (6), 
sub-section (7), sub-section (8), sub-section (9), sub-section 
(10), sub-section (11) and sub-section (12) shall be omitted; 
(4) in section 13, in sub-section (1),— 
(a) in clause (a), after the words "raw jute", the words ", dry 
chilli produced in West Bengal, silk fabric made or 
manufactured in West Bengal" shall be inserted; 
(b) in clause (c), after the words "raw jute", the words ", dry 
chilli produced in West Bengal, silk fabric made or 
manufactured in West Bengal" shall be inserted; 
(5) in section 14, sub-section (4), sub-section (5), sub-section (7), 
sub-section (8) and sub-section (9) shall be omitted; 
(6) in section 16, for the first proviso, the following proviso shall 
be substituted:— 
"Provided that there shall not be any levy of surcharge on 
the tax payable by a dealer on that part of his taxable turn-
over of sales as represents— 
(a) sales referred to in clause (a), clause (b), clause (c), or 
clause (f), of sub-section (2) of section 17, or 
(b) sales of foreign liquor as referred to in serial No. 22 of 
Schedule VIII:"; 
(7) in section 17,— 
(a) in sub-section (2),— 
(i) in clause (a), after sub-clause (ii), the following sub-
clause shall be inserted:— 
"(iii) two per centum of his taxable turnover of 
sales as represents sales to a registered dealer of 
goods, other than goods referred to in section 14 of , 4 of 1956. 	 the Central Sales Tax Act, 1956, specified in the 
certificate of registration of such dealer, as being 
intended for sale of goods within the meaning of sub-
section (1) of section 15 involved in the execution 
of works contract of the class or classes specified in 
the certificate of registration of the dealer to whom 
the goods are sold;"; 
(ii) clause (g) shall be omitted; 
Amendment 
of West Ben. 
Act XLIX of 
1994. 
61 
(b) 
The West Bengal Finance Act, 1998. 
[West Ben. Act 
(Section 6.) 
in sub-section (3), in clause (a),— 
(i) in sub-clause (ii), for the words, letter, figures and 
brackets "resale, other than the sale referred to in 
sub-clause (c) of clause (30) of section 2 or 
section 15, by him in West Bengal,", the words, 
figures, letter and brackets "resale by him in West 
Bengal and for sale referred to in section 15 by him 
in West Bengal, excluding a sale referred to in sub-
clause (c) of clause (30) of section 2," shall be 
substituted; 
(ii) in sub-clause (vi),— 
(A) for the words, figures and brackets "in a sub-
clause of (iv) of section 14", the following 
words, figures and brackets shall be 
substituted:— 
"in a sub-clause of clause (iv) of section 14"; 
(B) the following proviso shall be added at the 
end:— 
"Provided that deduction on account of sales 
referred to in this sub-clause shall be allowed to 
the dealer who sells such goods only when he 
can furnished in the prescribed manner a 
declaration in the prescribed form after being 
duly countersigned by the registered dealer 
from whom such goods were purchased;"; 
(c) after sub-section (4), the following sub-section shall be 
added:— 
"(5) (a) Notwithstanding anything contained in the 
first proviso, or the second proviso, to sub-section (2), 
or the proviso to sub-clause (ii) of clause (a) of sub-
section (3), if the Commissioner, on an application made 
by a dealer and after making such enquiries as he may 
consider necessary, is satisfied that the said dealer is 
not in a position to furnish all or any of the declarations 
referred to in the said provisos for supporting his claims 
in respect of his sales to any Government undertaking 
wholly owned by the Central Government or a State 
Government, being a registered dealer, on account of 
permanent discontinuance or closure of business in 
West Bengal of such Government undertaking on or 
62 
The West Bengal Finance Act, 1998. 
III of 1998.] 
(Section 6.) 
before the 31st day of March, 1997, and that the applica-
tion of the said provisos will cause undue hardship to 
him, the Commissioner may, by an order in writing, 
exempt such dealer from furnishing such declaration or 
declarations, subject to such conditions and restrictions 
as may be prescribed and subject to such other conditions 
as may be specified by the Commissioner in his order. 
(b) If the Commissioner considers it necessary for 
allowing a dealer exemption from furnishing declaration 
under clause (a), he may require any Government 
undertaking as aforesaid to which the goods have been 
sold, to produce and explain its accounts, records and 
documents in respect of such sales made to it. 
(c) An order passed by the Commissioner under 
clause (a) shall be final."; 
(8) after section 17B, the following section shall be inserted:— 
"Compounded 	 17C. (1) Any dealer liable to pay tax under rate of tax on sub-section (1) of section 10 and registered sale of lottery 
tickets. 	 under this Act selling lottery tickets in West 
Bengal, may, at his option, pay the tax in lieu of tax payable 
under section 17, section 16 or section 16A, on sales of 
lottery tickets in West Bengal at such compounded rate, not 
exceeding rupees five lakh per draw, as may be prescribed. 
(2) The tax payable at a compounded rate referred to in 
sub-section (1) shall be paid by the dealer referred to in that 
sub-section into the Reserve Bank of India or a Government 
Treasury in such manner or by such date as may be prescribed. 
(3) Any dealer who intends to opt for payment under 
sub-section (1) shall exercise his option by making an 
application to the Commissioner in such manner, and by 
such date, as may be prescribed."; 
(9) in section 18, for sub-section (2), the following sub-section 
shall be substituted:— 
"(2) Notwithstanding anything contained in sub-
section (1), the State Government may, if it is satisfied that 
it is necessary so to do in the public interest, by notification, 
and subject to such conditions as may be specified therein, 
direct that tax shall be payable at such rate lower than that 
fixed under sub-section (1), or exempt from payment a part 
of the tax payable by such dealer, or category of dealers, or 
for such class of sales, or for sale of such class or classes of 
goods, as may be specified in the notification."; 
63 
The West Bengal Finance Act, 1998. 
[West Ben. Act 
(Section 6.) 
(10) in section 21, to sub-section (1), the following proviso shall be 
added:— 
"Provided that— 
(a) where a declaration referred to in the first proviso to 
sub-section (2) of section 17, or a declaration referred 
to in sub-section (1) of section 6A of the Central Sales 74 of 1956. 
Tax Act, 1956, or a declaration or certificate referred 
to in sub-section (4) of section 8 of that Act has been 
furnished, or to be furnished, by a registered dealer 
to a dealer from whom goods have been purchased, 
or procured otherwise than by way of purchase, by 
such registered dealer for use by him directly in 
execution of a works contract, or 
(b) where goods have been procured by a registered 
dealer from his contractee otherwise than by way of 
purchase for use by him directly in execution of a 
works contract, 
the tax payable by such registered dealer executing such 
contract shall be levied at the rate of 
(i) twelve per centum of the contractual transfer price 
wholly or partly of electrical goods involved in execution 
of such contract, 
(ii) eight per centum of contractual transfer price of goods, 
other than those referred to in sub-clause (i), involved in 
execution of such contract."; 
(11) in section 22, for sub-section (5), the following sub-section 
shall be substituted:— 
"(5)' A re-roller shall not be entitled to any claim for set-off 
of tax under sub-section (1) realised from him in respect of 
his purchases of iron and steel, referred to in clause (iv) of 
section 14 of the Central Sales Tax Act, 1956, from a registered 
dealer who,— 
(a) enjoys exemption from payment of tax under section 39, 
or 
(b) enjoys remission of tax under section 41, section 42 or 
section 43, or 
(c) enjoys the benefit of deferment of payment of tax under 
section 40, section 42 or section 43, 
unless the re-roller claiming such set-off furnishes a declara-
tion referred to in the second proviso to sub-section (2) of 
section 17 to such dealer from whom such iron and steel is 
purchased."; 
64 
The West Bengal Finance Act, 1998. 
III of 1998.] 
(Section 6.) 
(12) after section 22A, the following section shall be inserted:— 
"Set-off of tax 	 22B. (1) Subject to the other provisions payable on sales of this section, there shall be a set-off of the of certain goods 
manufactured in amount of tax which has been realised from a 
West Bengal. 	 registered dealer in respect of sales to him of 
such goods as may be prescribed for use by him as input 
directly in the manufacture in West Bengal of such finished 
goods as may be prescribed against the amount of tax pay-
able by such registered dealer on his sales in West Bengal of 
the goods so manufactured. 
(2) A registered dealer who intends to claim a set-off of 
the amount of tax under sub-section (1) shall, for the purpose 
of determining the amount of tax to be set off, maintain 
accounts, records or evidence in respect of the price and 
quantity of the goods purchased for use directly in the manu-
facture in West Bengal of the finished goods, referred to in 
sub-section (1) and he shall also maintain accounts, records or 
evidence in respect of sale price and quantity of the goods so 
manufactured by him in West Bengal. 
(3) No claim for set-off of tax under sub-section (1) shall 
be allowed to a registered dealer in respect of tax realised from 
him on the sales made to him unless such sales are made to him 
by a registered dealer and the amount of tax realised from him 
is shown to have been separately charged in the bill or cash 
memo issued to him by the registered dealer from whom he 
has purchased such input. 
(4) A registered dealer shall not be entitled to any claim 
under sub-section (1) for the set-off of the amount of tax 
realised from him in respect of the sales to him of the goods by 
any other registered dealer who, during the eligible period, 
enjoys exemption from payment of tax under section 39, or 
remission of tax under section 41, section 42 or section 43, or 
enjoys the benefit of deferment of payment of tax under 
section 40, section 42 or section 43, unless the registered 
dealer claiming such set-off furnishes a declaration referred to 
in the second proviso to sub-section (2) of section 17 to the 
registered dealer from whom such goods have been purchased 
for use by him as input. 
65 
The West Bengal Finance Act, 1998. 
[West Ben. Act 
(Section 6.) 
(5) No registered dealer who enjoys tax holiday under 
section 39, deferment of payment of tax under section 40 or 
section 42 or section 43, or enjoys remission of tax under 
section 41, section 42 or section 43, shall be entitled to claim 
set-off under sub-section (1), unless the registered dealer 
claiming such set-off furnishes the declaration referred to in. 
the second proviso to sub-section (2) of section 17 to the 
registered dealer from whom any prescribed goods have been 
purchased by him in West Bengal for use by him as input 
directly in the manufacture as referred to in sub-section (1)."; 
(13) section 23 shall be omitted; 
(14) in section 26, for sub-section (12), the following sub-section 
shall be substituted:— 
"(12) Where a dealer, after cancellation of his certificate of 
registration under sub-section (11), pays in full the amount of 
tax, penalty or interest payable by, or due from, him under this 
Act in default of payment of which his certificate of registration 
has been cancelled under that sub-section, and makes an 
application to the prescribed authority for restoration of his 
certificate of registration together with receipted challan 
evidencing payment of such tax, penalty and interest within 
ninety days from the date of such cancellation or within such 
further time as may be allowed, the prescribed authority 
shall, by an order in writing, restore the certificate of registration 
of such dealer with effect from the date of cancellation of such 
certificate as if the certificate were in force during the period 
in which it remained cancelled."; 
(15) in section 28, for sub-section (4), the following sub-section 
shall be substituted:— 
"(4) The Commissioner may, by an order in writing and for 
good and sufficient reason, demand from any person or a 
dealer a reasonable security for proper use and safe custody of 
the form referred to in sub-section (3) of section 68 and 
obtained from the prescribed authority, and the way bill 
referred to in section 73."; 
(16) in section 29, in sub-section (1), for the proviso, the following 
provisos shall be substituted:— 
"Provided that no penalty shall be imposed under this sub-
section on any dealer where such dealer makes application for 
registration to the prescribed authority in the manner referred 
66 
The West Bengal Finance Act, 1998. • 
III of 1998.1 
(Section 6.) 
to in sub-section (2) of section 26 and the rules made thereunder 
on or before the 30th day of September, 1998, and gets himself 
registered: 
Provided further that no penalty shall be imposed under this 
sub-section in respect of the same fact for which a prosecution 
under sub-section (2) of section 88 has been instituted and no 
such prosecution shall lie in respect of a fact for which a 
penalty has been imposed under this section."; 
(17) after section 30, the following section shall be inserted:— 
"Composition 	 30A. (1) Notwithstanding anything of tax payable 
under 	 contained in section 17, the amount of tax 
section 17. 	 payable under that section by a registered 
dealer of such class of business or trade as the State Government 
may, by notification specify, may, subject to the other 
provisions of this section, be compounded by the Commissioner 
and the amount of tax so compounded shall be paid by such 
registered dealer in such manner, in such instalments, and by 
such date, as may be prescribed: 
Provided that the amount of tax payable by any registered 
dealer for any year shall not be compounded— 
(a) where his gross turnover of sales exceeds seven lakh 
rupees during the immediately preceding year, 
(b) where the period of three years in respect of which or 
part of which the dealer is assessable to tax has not 
expired from the date of certificate of registration 
granted to him under sub-section (5), or a fresh 
certificate issued to him under sub-section (7), of 
section 26, as the case may be, and 
(c) where the turnover of sales or any part thereof for 
such year represents sales of goods imported by him 
from any place outside West Bengal. 
Explanation.—For the purposes of this sub-section, in 
computing the period of three years referred to in clause (b) of 
the proviso, the period of a year or years which expired on any 
date before the appointed day during which a dealer was 
registered under the Bengal Finance (Sales Tax) Act, 1941 or 
under the West Bengal Sales Tax Act, 1954, repealed by 
section 106 (hereinafter referred to as earlier Act), and was 
assessed thereunder, shall be included. 
67 
The West Bengal Finance Act, 1998. 
[West Ben. Act 
(Section 6.) 
(2) A registered dealer who is eligible for composition of 
tax under sub-section (1) may, by an application made to the 
Commissioner in such form, in such manner, and by such 
time, as may be prescribed, exercise his option to pay the 
amount of tax to be compounded under sub-section (3) in lieu 
of the amount of tax payable by him under section 17. 
(3) If the Commissioner is satisfied that the application 
made by the registered dealer under sub-section (2) in respect 
of a year is correct and complete, he may compound the 
amount of tax payable by such dealer for such year by adding 
such percentage, not exceeding twenty-five per centum, as 
may be prescribed, of— 
(a) the amount of tax last assessed for all the periods of a year 
under any earlier Act or under this Act and admitted by 
him to be due from him, or the amount of tax paid by him 
as per receipts furnished along with the returns in 
accordance with the provisions of section 30 in respect of 
all the periods taken together of the year immediately 
preceding the year for which composition is sought, 
whichever is greater, or 
(b) the amount of tax compounded under this sub-section and 
paid by him in respect of the year, if any, immediately 
preceding the year for which composition is sought, 
as the case may be, to the amount of tax last assessed, paid or 
compounded as referred to in clause (a) or clause (b), whichever 
is applicable, for computing the amount of tax to be 
compounded. 
(4) The different percentage of the amount of tax last 
assessed, paid or compounded, referred to in sub-section (3), 
may be prescribed for different class or classes of business or 
trade. 
(5) Where the Commissioner has compounded the amount 
of tax payable by a dealer in respect of any year, he shall direct 
the dealer to pay the amount of tax so compounded in such 
manner, in such instalments, and by such date, as may be 
prescribed. 
(6) Where the business of a dealer, whose tax has been 
compounded in respect of any year, is closed down or 
. discontinued before the expiry of the year, he may, with the 
prior permission of the Commissioner, opt out of the ambit of 
68 
The West Bengal Finance Act, 1998. 
III of 1998.] 
(Section 6.) 
this section in respect of the remaining part of the year and he 
shall be required to furnish return or returns in accordance 
with the provisions of section 30 for all the periods of the year 
commencing from the 1st day of that year and the amount of 
tax paid as an instalment, if any, shall be adjusted with the 
amount of tax payable according to his returns. 
(7) Notwithstanding anything contained in section 45, the 
Commissioner shall not proceed to make any assessment of 
tax payable by a registered dealer for any period or periods of 
the year, if the amount of tax compounded under sub-section 
(3) has been fully paid by such registered dealer in accordance 
with the provisions of sub-section (5)."; 
(18) in section 31, for the words "three per centum"; in the two 
places where they occur, the words "two per centum" shall 
be substituted; 
(19) in section 32, in sub-section (1), for the words "three per 
centurn", the words "two per centum" shall be substituted; 
(20) after section 32, the following section shall be inserted:— 
"Interest on 	 32A. Where a dealer fails to make payment delayed payment 
of compounded of the amount of tax compounded under section 
amount of tax. 30A by the date specified in the notice issued 
thereunder, he shall pay a simple interest at the rate of two 
per centum for each British calendar month of default from the 
first day of the month next following the date specified in such 
notice up to the month preceding the month of full payment of 
such tax or up to the month of commencement of proceeding 
under section 52, whichever is earlier, upon so much of the 
amount of tax due from him according to such notice as 
remains unpaid at the end of such month of default."; 
(21) in section 34, for the words "three per centum", the words 
"two per centum" shall be substituted; 
(22) in clause (b) of the Explanation to section 40, the words 
"having investment in fixed capital assets exceeding ten lakh 
rupees" shall be omitted; 
(23) after section 45, the following section shall be inserted:— 
"Assessment in 	 45A. (1) If returns are furnished together selective cases with receipts showing payment of tax under on the basis 
of random 	 section 30 by the registered dealers in respect selection. 	 of all the periods of a year and it appears to the 
Commissioner from the returns furnished by each of the 
dealers that the gross turnover of sales made by each of such 
dealers for such year does not exceed seven lakh rupees, 
69 
The West Bengal Finance Act, 1998. 
[West Ben. Act 
(Section 6.) 
such dealers shall form a class and shall, notwithstanding 
anything contained in section 45, be eligible for selection for 
assessment of tax under sub-section (1) of that section on a 
random basis: 
Provided that the provisions of this sub-section shall not 
apply to any registered dealers,— 
(a) if assessment of tax payable by such dealer have not 
been made under sub-section (1) of section 45 for three 
consecutive years, or 
(b) if any accounts, registers or documents have been 
seized under section 66 from him during the period of 
three years immediately preceding the year of such 
selection, or 
(c) if he is eligible for composition of tax payable by him 
under section 30A. 
(2) If it appears to the Commissioner that the gross turn-
over of sales made by each of the dealers of the class referred 
to in sub-section (1) for all the periods of a year does not 
exceed seven lakh rupees and each of them is eligible for 
selection, the Commissioner may, select on a random basis 
in such manner and within such time as may be prescribed 
such percentage of such dealers as may be prescribed for 
assessment of the tax due from each of such dealers for all 
the periods of a year under sub-section (1) of section 45. 
(3) The Commissioner shall not proceed to make assessment 
of tax due from the registered dealers, other than those 
selected under sub-section (2), for assessment under sub-
section (1) of section 45 in respect of all the periods of the year 
referred to in sub-section (2): 
Provided that where the Commissioner has information 
that— 
(a) the gross turnover of sales furnished by 

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