Tribunal overturns refund sanction for 100% EOU, no unjust enrichment found

The Tribunal allowed the appeal, setting aside the order sanctioning the refund claim. The appellant, a 100% EOU, paid duty from both the Cenvat account and PLA for imported inputs. Despite the department's objection, the Tribunal found no unjust enrichment as the duty was not recovered twice from customers. Therefore, the Tribunal concluded that unjust enrichment did not apply, leading to the appeal's success.

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Issues:
Appeal against order of refund claim sanctioning set aside due to unjust enrichment.

Analysis:
The appellant, a 100% EOU, imported inputs cleared by paying duty from the Cenvat account. The department objected, stating duty for goods cleared as such should be paid from PLA. The appellant paid duty from PLA and filed a refund claim for the amount paid through the Cenvat account. The adjudicating authority sanctioned the refund claim, allowing credit in the Cenvat account. The department challenged this before the Commissioner (Appeals) on grounds of unjust enrichment, leading to the current appeal.

The Tribunal heard arguments from both sides and decided to dispose of the appeal without pre-deposit. It was established that duty was paid twice - first through Cenvat credit account and then through PLA. Importantly, it was not alleged that the appellant had recovered duty twice from customers. Given these facts, the Tribunal concluded that the bar of unjust enrichment did not apply to this case. Consequently, the impugned order was set aside, and the appeal was allowed.

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