Unjust enrichment bars dealer refund of excess tax on LNG sales; buyers who bore the levy may claim relief.

Refund of excess tax collected on LNG sales was held to belong to the buyers who bore the ultimate incidence, not the selling dealer who merely collected and remitted the tax. After the remission order reduced the effective tax burden to 6%, the dispute was confined to the excess collected at 15%. The Court applied the doctrine of unjust enrichment to bar refund in the dealer's hands and treated the petitioners as the proper claimants because they suffered the excess levy. The refund claim was therefore to be processed in favour of the petitioners.

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Issues: Whether the petitioners were entitled to refund of the excess tax collected by the selling dealer on sales of LNG, after the remission order reduced the effective tax burden to 6% and the dealer had collected tax at 15%.

Analysis: The remission order issued under the State VAT law granted relief on sales of natural gas used in manufacture of GST-regime goods, and the dispute remained confined to the excess amount collected over the remitted rate. The Court held that the petitioners had borne the ultimate burden of the tax, while the selling dealer had merely collected and deposited it. In such circumstances, a refund in the hands of the dealer would be barred by unjust enrichment, and the proper claim lay with the petitioners who actually suffered the excess levy.

Conclusion: The petitioners were entitled to refund of the excess tax collected above the remitted rate, and the refund claim was to be processed in their favour.

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