Erroneous refund recovery under Central Excise law cannot invoke unjust enrichment when the refund was already sanctioned and paid.

An erroneous refund sanctioned and paid pursuant to a final appellate order was sought to be recovered by invoking Section 11A(1) of the Central Excise Act, 1944. In such recovery proceedings, the doctrine of unjust enrichment under Section 11B was held inapplicable because the issue was recovery of a paid refund, not determination of a fresh refund entitlement. The recovery order therefore could not be sustained, and the assessee succeeded on the issue.

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Issues: Whether the Department could recover an erroneous refund by invoking Section 11A(1) of the Central Excise Act, 1944 and whether the doctrine of unjust enrichment could be applied in such proceedings.

Analysis: The refund had already been sanctioned and paid on the basis of a final appellate order. Recovery was initiated under Section 11A(1) as a proceeding for erroneous refund. In such proceedings, the principle of unjust enrichment embodied in Section 11B was held inapplicable, and the recovery order could not be sustained.

Conclusion: The recovery could not be upheld and the assessee succeeded on the issue.

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