Composition scheme liability continues despite no production or sales when the dealer's option is accepted under the statutory arrangement.

Under section 7-D of the U. P. Trade Tax Act, a dealer who validly opts for composition and whose option is accepted remains bound by the agreed lump sum composition money. The liability arises from the accepted statutory composition arrangement, not from actual turnover, production, manufacture, or sales during the relevant period. The scheme operates as a special non obstante mechanism for simplified tax payment, and its terms negatived any reduction in composition money even where business was not commenced or no bricks were produced or sold. The settled position is that the composition amount is payable as agreed under the scheme.

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Issues: Whether, under section 7-D of the U. P. Trade Tax Act, 1948, a dealer who has opted for composition and whose option has been accepted can avoid liability to pay the composition money on the ground that there was no manufacture or sale during the relevant period.

Analysis: Section 7-D operates as a special composition provision with a non obstante clause and permits a dealer, subject to the scheme, to pay a lump sum amount in lieu of tax. Once the option is exercised and accepted, the amount payable is fixed by the agreement under the scheme and is not linked to the dealer's actual turnover for that period. The scheme is intended to provide a simplified and hassle-free mode of tax realisation, and the terms of the scheme specifically negatived any reduction in composition money even if firing was not commenced or business was not done. The liability therefore flowed from the accepted composition arrangement and not from actual sales or production.

Conclusion: A dealer who has validly opted for and been accepted under the composition scheme remains liable to pay the agreed composition money even if no bricks were manufactured or sold during the relevant period. The earlier decisions holding so were correct.

Ratio Decidendi: Liability under an accepted composition scheme is governed by the agreed lump sum under the special statutory scheme and is not contingent upon actual turnover, production, or sales during the opted period.

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