Unjust enrichment under provisional assessment cannot apply retrospectively, and remand cannot be exceeded on re-adjudication.

Rule 9B(5) of the Central Excise Rules, 1944 was held inapplicable to provisional assessments made before 25.06.1999, so the refund claim was not barred by unjust enrichment and succeeded. The article also notes that, where an earlier appellate order had remanded the matter only to examine refund eligibility, the original authority could not reopen and confirm differential duty on design and engineering charges after that issue had attained finality. On both points, the departmental challenge failed and the refund order was sustained.

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Issues: (i) Whether the refund claim arising from provisional assessment for the period prior to 25.06.1999 was hit by unjust enrichment under Rule 9B(5) of the Central Excise Rules, 1944; (ii) Whether the original authority could confirm differential duty on design and engineering charges after the matter had already been remanded only for consideration of refund eligibility.

Issue (i): Whether the refund claim arising from provisional assessment for the period prior to 25.06.1999 was hit by unjust enrichment under Rule 9B(5) of the Central Excise Rules, 1944.

Analysis: The period in dispute was before 25.06.1999, whereas Rule 9B(5), which made the doctrine of unjust enrichment applicable to provisional assessments, came into force only from that date. The prior Larger Bench view was followed to hold that the rule could not be applied retrospectively to provisional assessments made before its commencement.

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

Issue (ii): Whether the original authority could confirm differential duty on design and engineering charges after the matter had already been remanded only for consideration of refund eligibility.

Analysis: The earlier appellate order had already set aside the demand on this aspect and had remanded the matter only for examining the refund claim. Since the issue had attained finality, the original authority could not travel beyond the scope of remand and re-adjudicate the differential duty demand.

Conclusion: The confirmation of differential duty was unsustainable and the issue was decided in favour of the assessee.

Final Conclusion: The departmental appeal failed on both issues and the refund order was sustained.

Ratio Decidendi: Rule 9B(5) of the Central Excise Rules, 1944 could not be applied to provisional assessments made before its introduction, and an adjudicating authority cannot exceed the limited scope of a remand once the earlier appellate finding has attained finality.

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