COMMNR. OF SALES TAX, U.P. vs M/S. SWADESHI POLYTAX LTD., U.P.

The Supreme Court upheld the decision of the Allahabad High Court which struck down Section 29-A of the U.P. Trade Tax Act as beyond the legislative competence of the State Government. The Court emphasized that the dealer must deposit the entire amount realized as tax into the Government Treasury, but any excess amount not due as tax must be held in trust for the person from whom it was collected. The Court affirmed the Trade Tax Tribunal's order for refund of the excess amount, thereby confirming the principle that excess tax collected must be refunded to the taxpayer.