Forfeiture under trade tax law requires a specific finding that the tax component was directly refunded to the purchaser.

Forfeiture under section 29A of the U.P. Trade Tax Act, 1948 was found unsustainable where there was no specific finding that the amount allegedly realised as tax had been directly refunded to the purchaser. The record showed that the Tribunal had not examined whether the credit-note amount represented a refund of the tax component to customers, and that issue went to the root of liability. On that basis, the Tribunal's order was set aside and the matter was remanded for fresh decision in accordance with law.

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Issues: Whether the forfeiture under section 29A of the U.P. Trade Tax Act, 1948 could be sustained in the absence of a specific finding that the amount alleged to have been realised as tax had been directly refunded to the purchaser.

Analysis: The applicant claimed that the amount covered by the credit note was in substance a refund of the tax component to the customers and that this material had not been properly examined. The record disclosed no specific finding by the Tribunal on whether the realised tax had in fact been directly refunded to the purchaser. In the absence of such a finding, the application of section 29A was considered legally unsustainable, particularly when the claimed refund issue went to the root of liability.

Conclusion: The Tribunal's order could not be sustained and was set aside. The matter was remanded to the Tribunal for a fresh decision in accordance with law.

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