Unjust enrichment bars excise refund unless non-passing of duty is proved; pending classification approval does not create provisional assessment.

A refund claim under excise law remained subject to the bar of unjust enrichment because pending approval of a classification list did not, by itself, create provisional assessment. The assessee could not shift from its Section 11B refund case to a new plea of deemed provisional clearances after remand, and the authorities correctly applied the statutory refund framework. The assessee also failed to prove that the duty incidence had not been passed on: the chartered accountant's certificate, buyer's letter, invoices and gate passes were insufficient to displace the Section 12B presumption. The penalty, however, was found unsustainable on the facts and was deleted.

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Issues: (i) whether the refund claim could escape the bar of unjust enrichment on the plea that the clearances were on a provisional basis pending approval of the classification list; (ii) whether the assessee had proved non-passing of the duty incidence to buyers; (iii) whether the penalty was sustainable.

Issue (i): whether the refund claim could escape the bar of unjust enrichment on the plea that the clearances were on a provisional basis pending approval of the classification list.

Analysis: The scope of the earlier remand was confined to examining whether the duty burden had been passed on. The assessee had pursued the refund claim under Section 11B and could not, at that stage, shift to a new plea that the assessments were deemed provisional merely because the classification list was pending. Mere pendency of finalization of the classification list does not by itself create provisional assessment. The principle that provisional clearances are outside Sections 11A and 11B applies only where the statutory scheme of provisional assessment is actually attracted. The authorities therefore correctly applied the unjust enrichment framework.

Conclusion: The plea of deemed provisional assessment was rejected and the refund remained subject to Section 11B.

Issue (ii): whether the assessee had proved non-passing of the duty incidence to buyers.

Analysis: The burden lay on the assessee to establish that the incidence of duty had not been passed on. The Chartered Accountant's certificate and the buyer's letter were found insufficient because the invoices and gate passes did not show a separate duty element in a manner that could reliably establish non-passing of the burden. The earlier affidavit had already been discarded, and no legally reliable material was produced to displace the statutory presumption under Section 12B.

Conclusion: The assessee failed to prove non-passing of duty, so the refund was not admissible.

Issue (iii): whether the penalty was sustainable.

Analysis: On the facts of the case, the authorities had no sufficient basis to sustain the penalty independently of the refund dispute.

Conclusion: The penalty was set aside.

Final Conclusion: The refund rejection was upheld, but the penalty was deleted, resulting in only a limited relief to the assessee.

Ratio Decidendi: A refund claim under the excise law remains governed by unjust enrichment unless the assessee affirmatively proves that the duty incidence was not passed on, and pendency of classification list approval does not by itself convert clearances into provisional assessments.

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