Provisional assessment refund outside unjust enrichment bar where departmental delay in finalisation led to refundable Consumer Welfare Fund credit.

Refund arising from finalisation of provisional assessment for a period prior to 25-6-1999 was treated as outside the unjust enrichment bar under Rule 9B(5) of the Central Excise Rules, 1944. Where the delay in finalising the assessment was attributable to the Department, the assessee was not required to satisfy the test of unjust enrichment for that refund. Amounts already credited to the Consumer Welfare Fund were therefore refundable to the assessee, and the disputed refund was allowed.

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Issues: Whether refund arising on finalisation of provisional assessment for a period prior to 25-6-1999 was required to satisfy the doctrine of unjust enrichment and whether the amount credited to the Consumer Welfare Fund was refundable to the assessee.

Analysis: The refund arose from finalisation of provisional assessments and subsequent readjudication. The delay in finalising the assessments was attributable to the Department, and the assessee should not be compelled to undergo the test of unjust enrichment on that account. In the relevant period, Rule 9B(5) of the Central Excise Rules, 1944 did not impose a bar of unjust enrichment for such refunds prior to 25-6-1999.

Conclusion: The refund was not subject to unjust enrichment and the amount credited to the Consumer Welfare Fund was refundable to the assessee.

Final Conclusion: The appeal succeeded and the assessee was held entitled to the disputed refund.

Ratio Decidendi: Where refund flows from finalisation of provisional assessment for a period prior to the incorporation of the unjust enrichment bar, and delay in finalisation is attributable to the Department, the refund cannot be denied on the ground of unjust enrichment.

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