Section 3 of Delhi VAT Act, 2004 - Imposition of Tax

Section 3(1): Liability of registered and registrable dealers

(1) Subject to other provisions of this Act, every dealer who is -

(a) registered under this Act; or

(b) required to be registered under this Act;

shall be liable to pay tax calculated in accordance with this Act, at the time and in the manner provided in this Act.

Section 3(2): Sales liable to VAT

(2) Every dealer shall be liable to pay tax at the rates specified in section 4 of this Act on every sale of goods effected by him -

(a) while he is a registered dealer under this Act; or

(b) on and from the day on which he was required to be registered under this Act.

Section 3(3): Calculation of net tax

(3) The amount of tax payable under this Act by a dealer, is the dealer's net tax for the tax period calculated under section 11 of this Act.

Section 3(4): Payment deadline and independent liability

(4) The net tax of a dealer shall be paid within twenty one days of the conclusion of each calendar month.

Explanation.- The obligation to pay the tax arises by virtue of this provision and is not dependent on furnishing a return, nor on the issue of a notice of assessment to the dealer.

Section 3(5): Manner of payment

(5) Tax shall be paid in the manner specified in section 36 of this Act.

Section 3(6): Continuing liability and cancellation

(6) Every dealer who has become liable to pay tax under this Act on the sale of goods shall continue to be so liable unless his taxable turnover during the preceding twelve months (and such further period as may be prescribed) has remained below the taxable quantum and on the expiry of the twelve months or such further period his liability to pay tax shall cease:

PROVIDED that any dealer whose liability to pay tax under this Act ceases for any other reason may apply earlier for the cancellation of his registration, and on such cancellation, his liability to pay tax shall cease:

PROVIDED FURTHER that a dealer shall remain liable to pay tax until the date on which his registration is cancelled.

Section 3(7): Liability when turnover again exceeds the threshold

(7) Every dealer whose liability to pay tax under this Act has ceased or whose registration has been cancelled, shall, if his turnover calculated from the commencement of any year, including the year in which the registration has been cancelled, again exceeds the taxable quantum on any day within such year be liable to pay such tax on and from the date on which his turnover again exceeds the taxable quantum, on all sales effected by him on and after that day.

Section 3(8): Liability during registration

(8) Where it is found that any person registered as a dealer ought not to have been so registered, then notwithstanding anything contained in this Act, such person shall be liable to pay tax for the period during which he was registered.

Section 3(9): Transporters and custodians of goods

(9) If any person who transports goods or holds goods in custody for delivery to or on behalf of any person, on being required by the Commissioner so to do, fails -

(a) to furnish any information in his possession in respect of the goods; or

(b) fails to permit inspection thereof;

then without prejudice to any other action which may be taken against such person, a presumption may be raised that the goods in respect of which he has failed to furnish information or permit inspection, are owned by him and are held by him for sale in Delhi and the provisions of this Act shall apply accordingly.

Section 3(10): Exhibition-cum-sale organizers

(10) If any person who, whether as principal, agent or in any other capacity organizes any exhibition-cum-sale in Delhi and fails -

(a) to furnish any information in respect of the goods brought or kept in stock or sold by any participant before or during or after the exhibition-cum-sale; or

(b) to ensure that all the participants in the exhibition-cum-sale have obtained registration under this Act and paid due tax; or

(c) to permit inspection of the business premises or goods or account and records of the participants; or

(d) to permit inspection of the accounts and records of the organizer in respect of the exhibition-cum-sale;

then, without prejudice to any other action which may be taken against such participant, a presumption may be raised that the goods of the participant who fails to obtain registration under this Act or the goods in respect of which the participant has failed to furnish information or failed to permit inspection, are owned by the organizer and are held by him for sale in Delhi and the provisions of this Act shall apply accordingly.

How Section 3 operates after the introduction of GST

The Delhi Goods and Services Tax Act, 2017 governs most intra-State supplies previously covered by the Delhi VAT framework. Section 9(2) of the DGST Act provides for the GST levy on petroleum crude, high speed diesel, motor spirit (petrol), natural gas and aviation turbine fuel from a notified date. Until the relevant levy is brought into force, existing VAT treatment may continue as applicable. Alcoholic liquor for human consumption is excluded from the general GST levy under Section 9(1).

For any transaction, verify the commodity classification, the date of supply, registration status, current VAT schedule, amendments and applicable Delhi Government notifications. The deadlines and conditions stated in the original statutory text should not be treated as a substitute for later valid rules, orders or notifications.

Official legislation and departmental resources

For authoritative text and updates, consult the Delhi VAT Act, 2004 (official departmental consolidated text as of 5 March 2014), the Delhi Department of Trade and Taxes notifications, the Department of Trade and Taxes website, and the Delhi GST Act, 2017. The 2014 consolidation is historical and must be read with later enacted amendments and notifications.