Unjust enrichment in refund claims can be rebutted by credible accounting records showing duty was kept as recoverable and not passed on.

Credible accounting evidence can rebut unjust enrichment in a refund claim where the assessee shows that disputed duty was recorded as "Excise Recoverable" and not charged to the trading or profit and loss account. The Tribunal accepted the chartered accountant's certificate and balance-sheet material, and held that these entries supported the conclusion that the duty was not included in the cost of finished goods or passed on to buyers. On that basis, the burden of proving unjust enrichment was discharged and refund was allowable.

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Issues: Whether the refund claim was barred by unjust enrichment, i.e. whether the appellant had passed on the incidence of duty to its purchasers.

Analysis: The appellant produced a chartered accountant's certificate and balance-sheet material showing that the disputed duty was debited under "Excise Recoverable" and not taken to the manufacturing, trading or profit and loss account. The lower authorities had rejected the claim on the assumption that mere non-debit to the trading account did not establish that the duty burden was not passed on. The Tribunal held that, on the evidence produced, the certificate was not to be brushed aside and the accounting entries supported the conclusion that the amount had not formed part of the cost of the finished goods or been recovered from buyers.

Conclusion: The appellant successfully disproved passing on of the duty incidence and was entitled to refund.

Ratio Decidendi: In a refund claim, where the assessee produces credible accounting evidence, including a chartered accountant's certificate and balance-sheet entries, showing that the disputed duty was retained as recoverable and not charged to trading or profit and loss account, the burden of proving unjust enrichment is discharged.

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