Unjust enrichment in excise refund claims is rebutted when invoices and books show duty was not passed to buyers.

Refund claims for duty paid under the compounded levy scheme were not barred by unjust enrichment where contemporaneous invoices showed duty was recovered only on transaction value and the books separately recorded the duty component as an advance deposit recoverable from the Government. On those facts, the statutory presumption under section 12B of the Central Excise Act, 1944 that duty incidence had been passed on to buyers stood rebutted, and the refund was admissible. Reliance on general refund principles and authorities arising from different factual settings was held inapplicable. The departmental challenge therefore failed, and the order allowing refund was sustained.

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Issues: Whether refund of duty paid under the compounded levy scheme was barred by unjust enrichment and whether the assessee had rebutted the presumption under section 12B of the Central Excise Act, 1944.

Analysis: The refund claim arose from duty paid under the compounded levy framework. The invoices for the relevant clearances declared that duty was collected only on transaction value, and the books of account showed the duty component being treated separately, with the disputed amount reflected as an advance deposit recoverable from the Government. On these facts, the statutory presumption under section 12B that duty incidence was passed on to buyers stood rebutted. The contrary reliance placed on general refund principles and on authorities dealing with different factual settings was held inapplicable.

Conclusion: The doctrine of unjust enrichment did not apply on the facts, and the refund was held admissible in favour of the assessee.

Final Conclusion: The departmental challenge failed, and the order allowing refund was sustained.

Ratio Decidendi: In refund claims arising from duty paid under the compounded levy scheme, the presumption of passing on duty under section 12B stands rebutted where contemporaneous invoices and accounting records show that the duty incidence was not recovered from buyers.

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