Pre-deposit refunds are not barred by ordinary limitation, but unjust enrichment applies to pending claims under amended law.
A pre-deposit made to pursue an appeal is not a voluntary duty payment, so the ordinary six-month refund limitation does not govern the claim and no separate protest is required. However, where the refund proceedings were still pending when the amended law came into force, the amended Section 11B applied, including the bar of unjust enrichment. The refund could not be finally granted without determining on evidence whether the duty burden had been passed on to customers, and the matter required fresh examination on that factual issue.
Issues: (i) Whether the limitation under Section 11B of the Central Excise Act applied to refund of an amount deposited under Section 35F of the Central Excise Act. (ii) Whether the amended provisions of Section 11B of the Central Excise Act, including the bar of unjust enrichment, applied to the refund claim pending when the amendment came into force. (iii) Whether the amount had been passed on to customers so as to disentitle refund.
Issue (i): Whether the limitation under Section 11B of the Central Excise Act applied to refund of an amount deposited under Section 35F of the Central Excise Act.
Analysis: The amount was deposited pursuant to a direction under Section 35F for the purpose of pursuing the appeal and was not a voluntary payment of duty. In such a situation, the six-month limitation prescribed for refund of duty did not govern the claim, and no separate protest was required. The deposit became refundable once the appellate relief was obtained.
Conclusion: The limitation under Section 11B did not bar the refund claim in so far as it arose from a deposit made under Section 35F.
Issue (ii): Whether the amended provisions of Section 11B of the Central Excise Act, including the bar of unjust enrichment, applied to the refund claim pending when the amendment came into force.
Analysis: The refund proceedings had not attained finality when the amended provisions came into force, because the Revenue's appeal against the refund order was pending. In that situation, the amended Section 11B governed the claim. The doctrine of unjust enrichment was therefore applicable to the refund proceedings notwithstanding the nature of the deposit.
Conclusion: The amended Section 11B applied to the pending refund claim and the bar of unjust enrichment was attracted.
Issue (iii): Whether the amount had been passed on to customers so as to disentitle refund.
Analysis: The record did not show a conclusive examination of whether the duty burden had in fact been recovered from customers. The factual controversy required verification on evidence before final refund relief could be granted or denied.
Conclusion: The matter was required to be examined afresh on the question of passing on of duty incidence.
Final Conclusion: The claim could not be finally allowed or rejected without determining whether the incidence of duty had been passed on, and the matter was sent back for fresh consideration on that factual question.
Ratio Decidendi: A refund claim arising from a pre-deposit made to pursue an appeal is not governed by the ordinary limitation for duty refunds, but if the refund proceedings remain pending when the amended law comes into force, the amended provisions including unjust enrichment apply and the factual question of passing on must be determined before refund is granted.
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