Security deposit under tax law cannot be forfeited without express statutory authority, especially where no liability arose.

A security deposit furnished under a fiscal statute cannot be forfeited merely because the transporter discontinued business or did not use statutory forms, unless the law expressly authorises forfeiture. Where no taxable liability arose and no business was carried on, the forfeiture order could not be sustained on allegations of misuse of the Government agency or non-use of forms under the Tripura Sales Tax and VAT framework. The interest claim was not accepted on the facts, but the principal deposit was directed to be refunded in the interests of justice.

---

---

Issues: Whether the security deposit furnished by a registered transporter could be forfeited merely because the transporter discontinued business and did not utilise the statutory forms, and whether the deposit was liable to be refunded.

Analysis: A security deposit under the taxing statute is intended to secure recovery of a dealer's or transporter's tax liability. Where no business was carried on and no taxable liability arose, forfeiture of the deposit could not be sustained in the absence of a clear legal provision authorising such action. The order of forfeiture based on alleged misuse of the Government agency and non-use of forms was held to be unsupported by the Tripura Sales Tax / Value Added Tax framework. The demand for interest was also not accepted on the facts, but the principal amount was directed to be returned in the interests of justice.

Conclusion: The forfeiture was unlawful, and the security deposit was directed to be refunded to the petitioner.

Ratio Decidendi: A security deposit taken under a fiscal statute cannot be forfeited unless the statute expressly authorises such forfeiture, particularly where no taxable liability has arisen.

---