Refund verification for indigenous origin and unjust enrichment upheld before relief can be granted.

Where refund entitlement depended on the factual character of raw materials received from other 100% Export Oriented Units, the Tribunal could require verification of whether the inputs were of indigenous origin or derived from imported stock before granting relief. The Tribunal also directed examination of unjust enrichment as a further condition for refund. The High Court found no legal infirmity in that approach, holding that conditional refund pending factual verification was legally unobjectionable. The revenue challenge was therefore rejected, and the Tribunal's direction was upheld.

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Issues: Whether the Tribunal committed any legal infirmity in directing verification of the indigenous origin of raw materials received from other 100% Export Oriented Units and in postponing refund relief until such verification and examination of unjust enrichment.

Analysis: The Tribunal accepted the departmental stand that the nature of the raw materials received by the assessee from other 100% Export Oriented Units had to be verified to ascertain whether they were of indigenous origin or derived from imported stock. On that basis, the Tribunal directed the authority to inquire into the origin of the materials and to consider refund only if the materials were shown to be of indigenous origin, subject also to verification of unjust enrichment. The Court found that this approach disclosed no legal error, because the Tribunal had merely required factual verification before any refund could be granted.

Conclusion: No infirmity was found in the Tribunal's direction for verification, and the appeal failed.

Final Conclusion: The revenue challenge was rejected because the Tribunal's conditional approach to refund, pending verification of the source of raw materials and unjust enrichment, was upheld as legally unobjectionable.

Ratio Decidendi: Where entitlement to refund depends on the factual character of goods or inputs, a tribunal may require verification of their origin and related refund conditions before granting relief.

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