Unjust enrichment does not bar refund where service tax was not legally payable and the contract price was treated as cum tax.

The contract price was treated as inclusive of service tax, and the construction service was regarded as falling within the exempted category. On that basis, the tax was not recoverable from the recipient as a separate burden, so the bar of unjust enrichment did not apply to the refund claim. The Tribunal followed its earlier view that where no tax was legally payable and the agreed price was cum tax, unjust enrichment is not attracted, and the refund was allowed.

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Issues: Whether the bar of unjust enrichment applied to the assessee's refund claim of service tax paid on construction of residential complex covered by the exemption notification.

Analysis: The contract price was treated as inclusive of service tax, and the service itself was held to fall within the exempted category. On that basis, the service tax was not recoverable from the recipient as a separate burden. The Tribunal followed its earlier view that where no tax was legally payable and the agreed price was cum tax, the bar of unjust enrichment does not arise.

Conclusion: The bar of unjust enrichment was held to be inapplicable and the refund claim was allowed.

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