Unjust enrichment barred refund where card can payments were treated as duty, not a deposit, after burden was passed on to buyers

Refund of amounts paid toward card cans was not treated as a mere deposit because the assessee did not dispute that the duty burden had been passed on to buyers. The payment was therefore characterised as duty, attracting the bar of unjust enrichment. On that basis, the Commissioner (Appeals) was found to have erred in holding that unjust enrichment did not apply and in directing adjustment of the refund against duty payable on intermediate goods. The refund claim was accordingly not maintainable as a deposit-based claim free from unjust enrichment.

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Issues: Whether the amount paid by the assessee towards card cans could be treated as a mere deposit so as to avoid the bar of unjust enrichment and permit refund.

Analysis: The assessee had not contested the allegation that the duty burden had been passed on to buyers. The payment was therefore treated as duty and not as a deposit. On that footing, the Commissioner (Appeals) was found to have erred in holding that unjust enrichment was inapplicable and in directing adjustment of the refund against duty payable on intermediate goods.

Conclusion: The refund claim could not be treated as a deposit-based claim free from unjust enrichment, and the Commissioner (Appeals) order was unsustainable.

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