(1) A registered dealer may, subject to the provisions of sub-sections (2) and (3), collect tax at the rates specified under section 6, on the sale of any goods, from the person to whom he sells the goods. and pay it over to Government is such manner as may be prescribed.

(2) Dealers registered under this Act, except those dealers paying presumptive tax under sub-section (5) of section 6 and those paying tax under clause (a) of section 8 by those undertaking works of Government of Kerala, Kerala Water Authority and Local Authorities, and under clause (b), clause (c)(ii) and clause (d) of section 8, alone shall be eligible to collect any sum by way of, or purporting to be by way of tax under this Act.

Provided that the dealers who are paying tax under sub section (5) of section 6 are entitled to recover from the buyers the amount of tax paid by him on the purchase value of such goods at the time of purchase.";

(3) No registered dealer shall collect any sum purporting to be by way of tax,-

(a) on the sale of any goods:

(i) which is included in the First Schedule; or

(ii) at a rate exceeding the rate at which he is liable to pay tax; or

(b) in respect of the purchase of any goods, whether or not he is liable to pay tax on such purchase.

Provided that nothing contained in this sub-section shall apply to the collection of an amount by a registered dealer towards the amount of tax already paid under this Act in respect of goods, the sale or purchase price of which is controlled by any law in force and the retail price fixed for such goods under such law is not inclusive of such tax:

Provided further that where the sale of any goods is exempted only at the point of sale by any dealer, such dealer may, notwithstanding anything contained in sub-section (1), at his option, collect tax in respect of the sale of such goods and thereupon he shall be liable to pay tax in respect of such goods.

(4) where a registered dealer has collected tax in respect of any goods in accordance with sub-section (1), he shall be liable to tax notwithstanding that his total turnover for the year is below the limit specified under sub-section (1) of section 6.

(5) Where any dealer has collected any tax under sub-section (1) but has failed to pay the tax due under this Act for such sale to the Government, any person or persons responsible for such collection on behalf of the dealer including a Director, Manager, Secretary or other officers of a company shall be jointly and severally liable for payment of such amounts to the Government forthwith as if it were a tax due from him.

Explanation. - For the purposes of this section, -

(a) "company" means any body corporate and includes a firm or other association of individuals, or a Co-operative society; and

(b) "Director" in relation to a firm, means partner in the firm.