Cum-duty pricing defeated unjust enrichment, allowing refund of excess excise duty and related interest.

Where unregistered small-scale manufacturers did not separately charge or recover Central Excise duty from buyers, the realised price was treated as cum-duty price. On that factual basis, no duty element was passed on, so the doctrine of unjust enrichment did not bar refund. The refund of excess duty paid, including the related interest component deposited with duty, was therefore admissible and the refund claim was upheld in full.

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Issues: Whether the refund claim was barred by the doctrine of unjust enrichment and whether the amount collected from buyers had to be treated as cum-duty price, entitling the appellants to refund of excess duty and related interest.

Analysis: The appellants were unregistered small-scale manufacturers, and the record, including the sample invoice, showed that no Central Excise duty was separately charged or recovered from buyers. In such circumstances, the amount realised from buyers was to be treated as cum-duty price. Since the duty had been paid later and no duty element had been passed on, the bar of unjust enrichment did not apply. The refund of excess duty paid, together with the interest component deposited along with duty, was therefore admissible.

Conclusion: The refund could not be denied on the ground of unjust enrichment and the appellants were entitled to refund of the excess duty and the related interest.

Final Conclusion: The impugned order of the Commissioner (Appeals) was set aside and the refund claim was upheld in full.

Ratio Decidendi: Where no central excise duty is separately charged from buyers and the material shows that the realised price is cum-duty price, refund of excess duty paid is not hit by unjust enrichment.

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