(1) Notwithstanding anything contained in Section 12-B, every registered dealer and every dealer who is liable to get himself registered under sub-section (1) or (2) of Section 10, shall submit such return or returns relating to his turnover, in such manner and within such period as may be prescribed.

Provided that nothing contained in this sub-section shall apply to a dealer who is registered under the Karnataka Value Added Tax Act, 2003 (Karnataka Act 32 of 2004) and who is not a dealer in petrol, diesel, aviation turbine fuel, lottery tickets and sugarcane.

Provided that the specified class of dealers as may be notified by the Commissioner shall submit the return in the prescribed form, electronically through Internet in the manner specified in the said notification:

(1-A) Before any dealer submits any return under sub-section (1), he shall, in the prescribed manner, pay in advance the full amount of tax payable by him on the basis of such return as reduced by any tax already paid under Section 12-B and shall furnish along with the return satisfactory proof of the payment of such tax, and the tax so payable shall for the purposes of Section 13 be deemed to be the tax due under this Act from such dealer. After the final assessment is made, the amount of tax so paid shall be deemed to have been paid towards the tax finally assessed.

Provided that the specified class of dealers as may be notified by the Commissioner shall pay the tax payable on the basis of the return under sub-section (1), by electronic remittance through Internet in the manner specified in the said notification.

(1-B) If default is committed in the payment of full amount of tax payable in advance for any year as reduced by any amount of tax already paid under Section 12-B, beyond thirty days after the close of the year, whether or not a return as required under sub-section (1) is filed; or if the amount of tax paid is less than the amount of tax so payable, the dealer defaulting payment of tax or making short payment of tax shall, in addition to the tax, pay interest calculated at the rate of two per cent per month from the thirty-first day to the date of payment of such tax or upto the date specified for payment of tax assessed under Section 12, as the case may be.

(2) If the assessing authority is satisfied that any return submitted under sub-section (1) is correct and complete, he shall assess the dealer on the basis thereof.

(3) If no return is submitted by the dealer under sub-section (1) before the date prescribed or specified in that behalf, or if the return submitted by him appears to the assessing authority to be incorrect or incomplete, the assessing authority shall assess the dealer to the best of his judgment, recording the reasons for such assessment:

Provided that before taking action under this sub-section the dealer shall be given a reasonable opportunity of proving the correctness and completeness of the return submitted by him.

(4) When making an assessment under sub-section (3), the assessing authority may also direct the dealer to pay in addition to the tax assessed, a penalty.-

(a) not exceeding an amount equivalent to the tax due but not less than one half of the amount of tax due on the turnover that was not disclosed by the dealer in his return; or

(b) not exceeding an amount equivalent to tax but not less than one half of the tax assessed in the case of failure to submit a return; or

(c) not exceeding an amount equivalent to the tax due but not less than one half of the amount of tax due on the turnover which in the opinion of the assessing authority would not have been disclosed voluntarily by the dealer in his return if such turnover was not noticed by any of the authorities empowered under this Act:

Provided that no penalty shall be levied on any turnover that has been subject to penalty under sub-section (3-A) of Section 12-B.

(5) No assessment under this Section for any year shall be made after a period of three years from the date on which the return under sub-section (1) for that year is submitted by a dealer:

Provided that assessment proceedings relating to any year ending before the date of commencement of the Karnataka Taxation Laws (Amendment) Act, 1997 in respect of which a return under sub-section (1) has been submitted before such commencement, shall be completed within a period of three years from the date of such commencement:

Provided further that nothing in this sub-section limiting the time within which assessment may be made, shall apply to an assessment made in consequence of, or to give effect to, any findings, directions or orders made under Section 20, 21, 22 or 22-A or any judgment or order made by any Court.

(6) In computing the period of limitation for assessment under this Section,-

(a) the time during which the proceedings for assessment in question have been deferred on account of any stay order granted by any Court or any other authority shall be excluded;

(b) the time during which the assessment has been deferred in any case or class of cases by the Joint Commissioner for reasons to be recorded in writing shall be excluded:

(c) in the case of a dealer who has been issued with eligibility certificate extending tax concessions under any of the package of incentives and concessions offered by the State and where such certificate issued is under dispute and such dispute has been referred to the authority constituted to resolve such disputes or the authority issuing such certificate, the time taken in such a case to resolve such dispute shall be excluded.

(7) Where an assessment under this Section is not concluded within the time specified in sub-section (5), the total and the taxable turnover declared by a dealer in his annual return shall be deemed to have been assessed for that year on the basis of the said return and the provisions of this Act relating to assessment of escaped turnover, payment and recovery, appeal and revision shall mutatis mutandis apply to such deemed assessment.