Appeal against CT-2 denial treated as protest, preserving refund limitation; unjust enrichment remanded for fresh evidence review.

Filing an appeal against denial of CT-2 certificates was treated as protest, so duty paid during the pendency of that challenge was regarded as payment under protest and the refund could not be rejected as time-barred. On unjust enrichment, the assessee relied on a chartered accountant's certificate and price-fixation material to show that the excise duty element on naphtha was not recovered from customers and that the urea price was fixed exclusive of that duty. Because that evidence had not been properly examined, the unjust enrichment issue was remanded for fresh consideration.

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Issues: (i) Whether the refund claim was barred by limitation, including whether the filing of an appeal against denial of CT-2 certificate amounted to protest; (ii) Whether the refund claim was hit by unjust enrichment.

Issue (i): Whether the refund claim was barred by limitation, including whether the filing of an appeal against denial of CT-2 certificate amounted to protest.

Analysis: The refund arose because the assessee was compelled to procure naphtha on full duty during the pendency of its challenge to the refusal of CT-2 certificates. Filing an appeal against the rejection order was treated as protest against the departmental action, especially when no separate mechanism existed for a buyer to lodge protest. Duty paid during the pendency of such appeal was therefore treated as payment under protest, and the refund could not be denied on limitation.

Conclusion: The refund claim was not barred by limitation, and this issue was decided in favour of the assessee.

Issue (ii): Whether the refund claim was hit by unjust enrichment.

Analysis: The assessee produced a chartered accountant's certificate and material from the price-fixation authority showing that the excise duty element on naphtha was not recovered from customers and that the retail price of urea was fixed exclusive of such duty. The appellate authority had not examined this evidence or the other supporting authorities relied upon by the assessee. The matter therefore required fresh consideration on the unjust enrichment question.

Conclusion: The finding on unjust enrichment was set aside and the issue was remanded for reconsideration.

Final Conclusion: The order rejecting the refund was set aside and the matter was sent back for fresh examination limited to the unjust enrichment aspect, while the assessee succeeded on limitation and protest.

Ratio Decidendi: Filing an appeal against denial of concessional-duty eligibility can amount to protest, so duty paid during the pendency of that appeal is treated as payment under protest for refund purposes; unjust enrichment must be decided on the basis of relevant evidence of non-passing of incidence.

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