CST excess collection cannot be forfeited by importing State law powers; TDS credit and refund adjustment were also allowed.

The Tribunal held that TDS credit could not be denied where the record showed no adverse material and the assessee had already sought rectification; the claim was allowed. It also held that the CST demand had to be adjusted against the GVAT refund, with consequential rectification of interest and refund computation; that plea was allowed. On the larger issue, the Tribunal ruled that excess tax collected under the CST Act could not be forfeited by importing a State Act forfeiture provision through section 9(2), because the CST Act is a self-contained code and imposes no forfeiture power by implication; the forfeiture was set aside.

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Issues: (i) Whether the assessee was entitled to TDS credit of Rs. 22,287 under the GVAT Act. (ii) Whether the demand under the CST Act was required to be adjusted against the refund arising under the GVAT Act with consequential effect on interest. (iii) Whether excess tax of Rs. 1,81,49,641 collected under the CST Act could be forfeited under the CST regime by applying the State Act provision.

Issue (i): Whether the assessee was entitled to TDS credit of Rs. 22,287 under the GVAT Act.

Analysis: The record did not show any adverse material against the claim for the shortfall in TDS credit. The grievance was also supported by the rectification request already moved before the first appellate authority. In the absence of contrary evidence from the department, the claim required acceptance.

Conclusion: The TDS credit claim was allowed in favour of the assessee.

Issue (ii): Whether the demand under the CST Act was required to be adjusted against the refund arising under the GVAT Act with consequential effect on interest.

Analysis: The adjustment issue arose from simultaneous demand and refund under the two enactments. The assessee's rectification request on this aspect was pending, and no contrary submission was shown to defeat the claim before the Tribunal. The issue was treated as one requiring consequential correction in the assessment/refund computation.

Conclusion: The adjustment plea was allowed in favour of the assessee, with consequential rectification as to interest and refund computation.

Issue (iii): Whether excess tax of Rs. 1,81,49,641 collected under the CST Act could be forfeited under the CST regime by applying the State Act provision.

Analysis: The CST Act was treated as a self-contained code for levy, collection, penalty, and related consequences. Section 9(2) permitted State machinery to act for CST purposes, but it did not enlarge the substantive powers under the CST Act so as to create a forfeiture mechanism absent express provision. Sections 9A, 10, and 10A showed that the Act separately dealt with prohibited collection and penalties, and the Tribunal applied the principle that a pecuniary liability or forfeiture cannot be imposed by implication. The State Act forfeiture provision was therefore not attracted to CST excess collection.

Conclusion: The forfeiture of excess CST collection was held impermissible and the assessee succeeded on this issue.

Final Conclusion: The appeal was allowed and the impugned forfeiture under the CST Act was set aside, while the assessee's claims for TDS credit and consequential refund adjustment were accepted for further consequential orders.

Ratio Decidendi: In the absence of an express provision in the CST Act, excess tax collection cannot be forfeited by importing a forfeiture power from the State sales tax law through the machinery provision of section 9(2).

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