70. Furnishing of Security. sections 12, 22 and 31.

 (1) The security required to be furnished under the Act, may be in the following forms namely –

(a) cash deposit in the Government Treasury under head “0040-Tax on Sales, Trade etc.”

(b) post office saving bank account, the account being pledged to the Commissioner or any officer authorised by him in writing in this behalf;

(c) bank guarantee from a Scheduled Bank agreeing to pay to the State Government on demand the amount of security;

(d) personal bond with solvent surety/sureties for the amount of security to the satisfaction of the authority before whom it is required to be furnished under these rules, which shall be in Form VAT-B2 on a non-judicial; paper of the appropriate value; and

(e) such saving certificates or bonds or fixed deposit receipts as are issued by the Government of India, the State Government, or Reserve Bank of India or Scheduled Bank, from time to time, to be pledged to the Commissioner or any other officer authorised by him in this behalf.

(2) The security furnished under sub-sections (1), (2), (4) and (6) of section 12 shall be maintained in full so long as the registration certificates continues to be in force.

(3) In the event of default in the payment of any tax, interest, penalty or any other amount due, the security furnished by the dealer shall be liable to adjustment towards such amount, after intimation to him and the short fall in the amount of security shall unless ordered otherwise be made up by him within a period of fifteen days from the date of intimation in any of the ways specified in sub- rule (1).

(4) The security furnished under sub-section (6) of section 31 shall be forfeited, if the payment of the amount due on account of advance tax, penalty or interest imposed is not made within the time allowed for the payment thereof.