I am just curious as this seems to have happened to someone I know, they asked me this morning if I knew if this was allowed to happen, I have only sold a couple of items, so I couldn't answer that, so I thought I'd ask and see what could have happened to them!
Yes, there could be valid reasons for this- for example damage to an item that was undetected before it was listed. The buyer must be notified by the seller & have agreed to it before a seller requests to have the transaction cancelled. The seller must also issue a 100% refund. eBay will send a message to the buyer to verify the agreement to cancel before refunding the seller their Final Value Fee.