Compounded levy refund and unjust enrichment: invoice evidence and a CA certificate supported allowance of the claim.

Under a compounded levy scheme, duty is paid on annual capacity and not on a consignment-wise basis; where the duty element is not shown in the invoice and a Chartered Accountant's certificate supports that the burden was not passed on to customers, the refund claim is not barred by unjust enrichment and may be allowed.

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Issues: Whether the refund claim arising from duty paid under the compounded levy scheme was barred by unjust enrichment.

Analysis: The duty in a compounded levy regime is paid on the basis of annual capacity fixed under the relevant rules and not consignment-wise. On the facts, the duty element was not reflected in the invoice, and the lower authorities also relied on the Chartered Accountant's certificate indicating that the duty burden had not been passed on to customers. In such circumstances, the method adopted to establish absence of passing on of duty was found acceptable.

Conclusion: The refund claim was not hit by unjust enrichment and was rightly allowed; the Revenue's challenge failed.

Ratio Decidendi: In a compounded levy scheme, where duty is not invoice-linked and the record shows that the duty incidence was not passed on, refund cannot be denied on the ground of unjust enrichment.

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