Unjust enrichment and refund claims: export cess refund allowed where contract terms showed no passing on of duty burden.

Refund of export cess was held not to be barred by unjust enrichment where the sale contract, Incoterms and surrounding commercial documents showed that the FOB price did not include the cess and the burden had not been passed to the foreign buyer. The presumption under Section 28D was treated as rebuttable and was displaced on the facts. Refund was also not denied for want of an appeal against the speaking order because no adverse assessment order subsisted, the original order had allowed refund, and an appeal was not a precondition in those circumstances. The refund claims were therefore maintainable.

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Issues: (i) Whether the refund of export cess was barred by unjust enrichment on the footing that the FOB value included the cess. (ii) Whether refund could be denied for failure to challenge the speaking or assessment order by appeal.

Issue (i): Whether the refund of export cess was barred by unjust enrichment on the footing that the FOB value included the cess.

Analysis: The refund claim under the Customs Act is subject to the doctrine of unjust enrichment, and Section 28D raises a rebuttable presumption that duty has been passed on. That presumption can be displaced by contract terms, commercial documents, and surrounding evidence. On the materials before it, including the sale contract and Incoterms, the Court found that the FOB price did not include the export cess and that the burden of cess had not been passed to the foreign buyer. The finding recorded by the appellate authority that the FOB value included the cess was held unsustainable.

Conclusion: The refund claim was not barred by unjust enrichment and the issue was answered in favour of the assessee.

Issue (ii): Whether refund could be denied for failure to challenge the speaking or assessment order by appeal.

Analysis: A refund claim cannot be used to reopen a final assessment order, but that rule applies where an adverse assessment stands unchallenged. Here, the speaking order itself had allowed refund, no adverse assessment order was shown to exist, and the customs authorities had accepted the assessee's case at the original stage. In those circumstances, filing an appeal against the speaking order was not a prerequisite to maintain the refund claim. The Court also held that the Tribunal could consider a new ground relating to the subject matter of dispute.

Conclusion: Refund could not be denied on the ground that no appeal had been filed against the speaking order, and the issue was answered in favour of the assessee.

Final Conclusion: The appeals succeeded, the orders of the Tribunal and the appellate authority were set aside, and the refund claims were held maintainable.

Ratio Decidendi: Where export duty or cess is borne by the seller under the contract and is not shown to have been passed on to the buyer, refund is not barred by unjust enrichment; and where the original speaking order itself allows refund and no adverse assessment subsists, non-filing of an appeal does not defeat the refund claim.

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