Refund recovery on unjust enrichment failed where settled law did not permit denial of a sanctioned refund.

Refund already sanctioned and paid could not be recovered merely on the ground of unjust enrichment by invoking Section 11A. The departmental order proceeded on the assumption that the duty burden had been passed on to customers, but the applicable settled law did not permit denial or recovery of the refund on that basis. The cited precedent was treated as inapposite, and the recovery action was found unsustainable, with relief granted to the petitioners.

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Issues: Whether the department could recover a refund already granted on the ground of unjust enrichment by invoking Section 11A.

Analysis: The refund had been sanctioned and paid to the petitioners. The order of recovery rested on the view that the duty element had been passed on to customers and that the earlier refund was therefore wrongly granted. The Court held that, on the settled law applicable at the time, the departmental authorities could not deny or recover refund on the ground of unjust enrichment, and reliance on the cited precedent was misplaced.

Conclusion: The recovery order was unsustainable and was quashed in favour of the petitioners.

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