(1) Every dealer shall pay for each year tax on his taxable turnover at the rate of twelve per cent at the point of first sale.

(1-B) Notwithstanding anything contained in sub-section (1), in the case of glass bottles, the tax shall be payable by a dealer, at every point of sale at the rate of twelve per cent on the taxable turnover, in each year relating to such goods.

(1-C) Notwithstanding anything contained in sub-section (1), in the case of silk fabrics, the tax shall be payable by a dealer at every point of sale at the rate of four per cent on the taxable turnover in each year relating to such goods:

Provided where the own manufactured silk fabrics are sold to a dealer liable to tax under this Act, the sale of such silk fabrics shall not be deemed to be a sale by a dealer liable to tax under this Act.

Explanation. - For the purpose of this sub-section and sub-section (8) of Section 17, "silk fabrics" means silk fabrics in which the proportion of silk is sixty per cent or more by weight of the total fibre content but excluding any cloth on which a duty under the Additional Duties of Excise (Goods of Special Importance) Act, 1957 (Central Act 58 of 1957), has been levied.

(2) Notwithstanding anything contained in sub-section (5), every dealer, shall, whatever be the quantum of his total turnover, be liable to pay tax at the rate specified in this Act on the sale of any goods which he has purchased in the course of inter-State trade or commerce in respect of which the concessional rate of tax under clause (b) of sub-section (1) of Section 8 of the Central Sales Tax Act, 1956, has been levied.

(3) Notwithstanding anything contained in sub-section (1), the tax under this Act shall be levied-

(a) in the case of the sale of any of the goods mentioned in column (2) of the Second Schedule, by the first or the earliest of successive dealers in the State who is liable to tax under this section, a tax at the rate specified in the corresponding entry of column (3) of the said Schedule, on the taxable turnover of sales of such dealer in each year relating to such goods:

Provided that in respect of sale by the State Government of any of the goods mentioned in Serial Number 6 of Part 'L' and Serial Number 2 of Part 'O' of the Second Schedule, the State Government shall be deemed to be the first dealer in the State and shall be entitled to collect the tax under Section 19:

Provided also that in respect of sale of goods mentioned in Serial Number 11-A of Part 'F', Serial Number 12 of part 'M' and Serial Number 5 of Part 'P' and Serial Number 1 of Part 'K' of the Second Schedule, the sale by one oil company to another oil company shall not be deemed to be a sale by the first or the earliest of successive dealers in the State but the sale by the latter company to another person not being an oil company shall be deemed to be the sale by the first or the earliest of successive dealers in the State liable to tax.

Provided further that where any goods liable to tax under this Act are produced or manufactured by a dealer with the brand name or trade mark of any other dealer and which are not used by the latter as raw materials, component parts or packing materials as defined under the explanation to Section 5-A, the sale of such good by the dealer who has produced or manufactured to the dealer who is the brand name or trade mark holder, shall not be deemed to be, but the subsequent sale of such goods by the dealer having the right either as proprietor or other wise to use the said name or the trade mark, either directly or through another, on his own account or on account of others shall be deemed to be the sale by the first dealer liable to tax under this Section:

Provided also that no tax under this sub-section shall be payable on the currency notes printed by the Bharatiya Reserve Bank Note Mudrana Limited, Mysore and sold to the Reserve Bank of India:

Provided also that where for any reason, the goods sold under the brand name have been subjected to tax at the hands of the producer or the manufacturer of such goods the tax payable under clause (a) on subsequent sale of such goods by the trademark holder or the brand name holder or any other dealer having the right either as proprietor or otherwise to use the said name or trademark either directly or through another on his own account or on account of others, shall be reduced by the amount of tax already paid on the sale of such goods by such producer or the manufacturer and the said producer or manufacture shall not be entitled to refund of such tax paid by him:

Provided also that where goods are sold, under a brand name by the trade mark holder or the brand name holder or any other dealer having the right as proprietor or otherwise to use the said name or trade mark either directly or through another on his own account or on account of others, exclusively to a marketing agent or distributor or wholesaler or any other dealer, subsequent sale of such goods by the latter shall also be liable to tax under this section and the tax so payable shall be reduced by the amount of tax already paid on the sale of such goods by the former.

Illustration. - 'A' has registered a trade mark for manufacture of certain goods. He gets the said goods manufactured by 'B' under the said trade mark. The sale by 'B' to 'A' of the said goods is not the first sale but the sale by 'A' or by any other person on his account is the first sale.

(b) in the case of purchase of any of the goods mentioned in column (2) of the Third Schedule, at the rate and only at the point specified in the corresponding entries of columns (4) and (3) of the said schedule, on the dealer liable to tax under this Act, on his taxable turnover of purchases in each year relating to such goods.

Explanation II.- For the purpose of the second proviso to clause (a), the expression "oil company" namely:-

(a) The Indian Oil Corporation Limited;

(b) The Bharath Petroleum Corporation Limited;

(c) The Hindustan Petroleum Corporation Limited;

(d) Indo- Burma Petroleum Company;

(e) Mangalore Refinery and Petrochemicals Limited,

and includes any other oil company which the Government of the Karnataka may by notification, specify.

(3-A) Notwithstanding anything contained in clause (a) of sub-section (3) of this section, in the case of sale of Indian made liquor (other than beer) held in opening stock as on the date of commencement of Karnataka Taxation Laws (Amendment) Act, 2000 by a dealer holding licence in CL-I under the Karnataka Excise (Sale of Indian and Foreign Liquor) Rules, 1968, tax at the rate of sixty per cent shall be levied on the taxable turnover of sales of such dealer relating to such goods:

Provided that the tax payable on the sale of such liquor shall be reduced by an amount of tax paid on such liquor at the immediately preceding point of sale.

(3-C) Notwithstanding anything contained in sub-section (3), in the case of sale of any of the goods mentioned in column (2) of the Eight Schedule which has already been subjected to tax under clause (a) of sub-section (3) by a dealer liable to tax under this Act, a tax at the rate specified in the corresponding entry of column (3) of the said schedule shall be levied at the point of last sale in the State on the taxable turnover of sales of such dealer in each year relating to such goods.

Explanation.- For the purposes of this sub-section last sale shall be the sale by the retailer to a consumer and shall not include the first sale in the State.

(3-D) Notwithstanding anything contained in this Act, where goods sold or purchased are contained in containers or are packed in any packing materials liable to tax under this Act, the rate of tax and the point of levy applicable to turnover of such containers or packing materials, as the case may be, shall, whether the containers or the packing materials have already been subjected to tax under this Act or not or whether the price of the containers or of the packing materials is charged for separately or not, be the same as those applicable to goods contained or packed:

Provided that no tax under this sub-section shall be leviable if the sale or purchase of goods contained in such containers or packed in such packing materials is exempt from tax under this Act.

(3-E) Notwithstanding anything contained in sub-section (1) or (3), every dealer who purchases goods without a brand name or a trade mark assigned to such goods and sells such goods after assigning a brand name or a trade mark either directly or through another on this own account or on account of others, shall irrespective of the goods so purchased without a brand name or a trade mark have already been subjected to tax under the said sub-sections, be liable to pay tax at such rates as applicable to such goods under the Act on the turnover relating to sale of such goods:

Provided that tax payable under this sub-section shall be reduced by an amount of tax which is already paid or has become payable under any of the said sub-section on the corresponding value of the goods so purchased without the brand name or the trade mark:

Provided further that the burden of proving that the tax under any of the said sub-sections has already been paid or has become payable and of establishing the exact quantum of tax so paid or payable as the case may be, on goods purchased without a brand name or a trade mark shall be on the dealer claiming reduction.

(4) Notwithstanding anything contained in sub-section (1) or Section 5-B or Section 5-C a tax under this Act shall be levied in respect of the sale or purchase of any of the declared goods mentioned in column (2) of the Fourth Schedule at the rate specified in the corresponding entries of columns (4) and (3) of the said Schedule on the dealer liable to tax under this Act on his taxable turnover of sales or purchases in each year relating to such goods:

Provided that where tax has been paid in respect of the sale or purchase of any of the declared goods under this sub-section and such goods are subsequently sold in the course of inter-State trade or commerce, and tax has been paid under the Central Sales Tax Act, 1956 (Central Act 74 of 1956), in respect of the sale of such goods in the course of inter-State trade or commerce, the tax paid under this Act shall be reimbursed to the person making such sale in the course of inter-State trade or commerce, in such manner and subject to such condition as may be prescribed;

Provided further that in respect of the sale of cereals mentioned in Serial Number 9 of the Fourth Schedule, made by any person to a procurement agent appointed by the Government of Karnataka or to any sub-agent of such procurement agent in pursuance of the Karnataka Rice Procurement (Levy) Order, 1981, or any other Foodgrains Procurement (Levy) Order of the Government of Karanataka for the time being in force, such sale shall not be deemed to be, but the subsequent sale by the said procurement agent or sub-agent shall be and shall be deemed to be the point at which the tax under this Act shall be levied:

Provided also that where tax has been paid under this sub-section on the purchase of paddy and such paddy is either subsequently sold to or is hulled and the resultant rice is sold to a procurement agent appointed by the Government of Karnataka or to any sub-agent of such procurement agent in pursuance of the Karnataka Rice Procurement (Levy) Order, 1984, or any other Foodgrains Procurement (Levy) Order of the Government of Karnataka for the time being in force, the tax paid under this Act on the purchase of such paddy shall be reimbursed to the person making such sale to such procurement agent or his sub-agent, as the case may be, in such manner and subject to such conditions as may be prescribed.

Provided also that in respect of goods specified at sub-item (i) of item (a) of Serial Number 5 of Fourth Schedule and on purchase of which no tax under this Act is leviable or levied on or before First day of April, 1992 on the ground that such purchase was not the last purchase in the State, a dealer holding such goods in stock on the said date shall be deemed to be the last purchaser in the State liable to tax at the rates applicable as on the First day of April, 1992 on such goods irrespective of the fact whether such stock of goods held as on the First day of April, 1992 attained the character of last purchase in the State or otherwise.

Explanation.- The expression "declared goods" means goods declared under section 14 of the Central Sales Tax Act, 1956 (Central Act 74 of 1956), to be of special importance in inter-State trade or commerce.

(5) (a) A dealer whose total turnover in any year is less than two lakh rupees shall not be liable to pay tax for that year.

(b) Notwithstanding anything contained in clause (a)-

(i) every casual trader in any of the goods other than those specified in the fifth schedule shall be liable to pay tax at the rate specified in this Act on his taxable turnover of sales or purchases in each year whatever his total turnover during the year may be;

(i-a) Every dealer engaged in the execution of works contract mentioned in Sixth Schedule shall be liable to pay tax at the rate specified in the said schedule on his taxable turnover of transfer of property in goods (whether as goods or in some other form) involved in the execution of works contract in each year whatever be the quantum of his total turnover during the year;

(ii) every manufacturer, dealer in liquor and beer and dealer who brings any goods into the State or to whom any goods are despatched form any place outside the State shall be liable to pay tax at the rate specified in this Act on his taxable turnover of sales or purchases in each year if his total turnover during the year in not less than one lakh rupees.

(6) For the purpose of this section and other provisions of this Act, the total turnover, taxable turnover or turnover shall be determined in accordance with such rules as may be prescribed.

(7) The tax shall be assessed, levied and collected in such manner and in such instalments, if any, as may be prescribed:

Provided that in respect of the same transaction of sale, the buyer or the seller, but not both, as determined by such rules as may be prescribed, shall be taxed.

(9) Subject to such rules as may be prescribed, the assessing authority may assess a dealer for any year as if his transaction in such year has been the same as in the previous year.