(1) Subject to the limitations in the Act, the Commissioner may decide to accept, on application from any person, a sum by way of composition of an offence committed by him under the Act or these rules, either before or after the commencement of the proceeding in respect of such offence.

(1A) (i) The application under sub-rule (1) shall be filed in duplicate, and courtfee stamps of the value as specified in rule 46, shall be duly affixed thereon.

(ii) The applicant shall explain the gist of the offence committed and certify the Commission of the offence sought to be compounded, in the application.

(iii) The applicant shall support his application with a detailed statement of taxable purchases and sales account of the tax due/ /paid, if any, and furnish an undertaking that no tax is due from him either as preceding dealer or succeeding dealer, on the date of such application.

(iv) The applicant shall submit any other information that may be necessary for consideration of the application for compounding of offence.

(2) On taking a decision under sub-rule (1), the Commissioner , shall, if there are no reasons to the contrary, make an order in writing specifying therein -

(a) the sum determined by way of composition;

(b) the date on or before which the sum shall be paid into the Government Treasury;

(c) the authority before whom and the date on or before which a e-challan shall be produced in proof of such payment, and

(d) the date on or before which the person shall report the fact to the Commissioner.

(3) On receipt of the copy of e-challan as a proof of payment of the composition fee as required under sub-rule(2) , the Commissioner shall pass an order compounding the offence and shall send a copy of such order to the person concerned and also to the authority referred to in clause (c ) of sub-rule (2).