Exemption notification for water supply project goods accepted on certificate, but refund still subject to unjust enrichment scrutiny.

Pipes supplied for a water supply project were treated as covered by Notification No. 6/2006-CE where a competent government certificate identified the project and showed compliance with the exemption conditions, so the refund claim was held maintainable on merits. The refund was nevertheless left open for verification under the bar of unjust enrichment, because the lower authorities had questioned whether the duty incidence had been passed on. The exemption issue was therefore resolved in favour of the assessee, while the refund claim remained subject to scrutiny only on unjust enrichment.

---

---

Issues: (i) whether the pipes supplied for a water supply project satisfied the conditions of Notification No. 6/2006-CE dated 01.03.2006 so as to entitle the appellant to refund of duty; (ii) whether the refund claim was liable to be tested on the bar of unjust enrichment.

Issue (i): whether the pipes supplied for a water supply project satisfied the conditions of Notification No. 6/2006-CE dated 01.03.2006 so as to entitle the appellant to refund of duty

Analysis: The goods were supplied for execution of a water supply project and the duty had been paid at the time of clearance, after which refund was sought. The prescribed certificate issued by the competent government authority contained the relevant project particulars. The objective of the notification was treated as clear enough to cover the supplies in question, and the certificate was held sufficient to establish compliance with the exemption condition.

Conclusion: The exemption condition was held to be satisfied and the refund claim was held maintainable on merits in favour of the assessee.

Issue (ii): whether the refund claim was liable to be tested on the bar of unjust enrichment

Analysis: The lower authorities had also relied upon deficiencies in supporting documents to deny that the duty incidence had not been passed on. The matter was therefore directed to be examined further only on the limited question of unjust enrichment.

Conclusion: The refund claim remained subject to verification of the bar of unjust enrichment.

Final Conclusion: The appeal succeeded to the extent that the denial of refund on the exemption issue was set aside, while the refund claim was remitted only for consideration of unjust enrichment.

Ratio Decidendi: A competent government certificate showing project compliance can suffice to establish satisfaction of an exemption notification where the notification's object clearly covers the supply, leaving only the statutory refund bar of unjust enrichment for further scrutiny.

---