Refund from provisional assessment: limitation runs from duty adjustment, and unjust enrichment fails when burden shifting is rebutted.

Refund claims arising from finalisation of provisional assessments are governed by the date of duty adjustment after final assessment under the Explanation to Section 11B, so they are not barred by limitation on the basis of earlier dates relied on by the department. The article also notes that unjust enrichment is not attracted where the assessee rebuts the Section 12B presumption with evidence, including a Chartered Accountant's certificate, showing that the duty incidence was not passed on to buyers. On that basis, refund denial was considered unsustainable and retention by the Revenue inconsistent with Article 265 of the Constitution.

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Issues: (i) Whether refund claims arising from finalisation of provisional assessments were barred by limitation under Section 11B of the Central Excise Act, 1944; (ii) Whether the refund claims were hit by unjust enrichment.

Issue (i): Whether refund claims arising from finalisation of provisional assessments were barred by limitation under Section 11B of the Central Excise Act, 1944.

Analysis: The relevant date in cases of provisional assessment is the date of adjustment of duty after final assessment, as provided in the Explanation to Section 11B. Refund flowing directly from finalisation of provisional assessment is governed by Rule 7 of the Central Excise Rules, 2002 and does not require a separate refund application within the ordinary limitation period reckoned from the dates relied upon by the lower authority. The reasoning that the claims were time-barred from the dates of finalisation of assessment was therefore not sustainable.

Conclusion: The refund claims were not barred by limitation.

Issue (ii): Whether the refund claims were hit by unjust enrichment.

Analysis: The duty was finally worked out on the basis of normal transaction value under Rule 2(b) and Rule 7 of the Central Excise Valuation Rules, 2000. The appellant produced a Chartered Accountant's certificate to show that the incidence of duty had not been passed on to buyers. The presumption under Section 12B of the Central Excise Act, 1944 stood rebutted on the facts found, and the amounts could not be denied merely on the assumption of passing on of duty. In the absence of unjust enrichment, retention of the amount by the Revenue was inconsistent with Article 265 of the Constitution of India.

Conclusion: The refund claims were not hit by unjust enrichment.

Final Conclusion: The denial of refund was unsustainable, and the assessee was entitled to refund of the amounts claimed.

Ratio Decidendi: Refund arising from finalisation of provisional assessment is governed by the date of adjustment of duty after final assessment, and unjust enrichment is inapplicable where the claimant satisfactorily rebuts the statutory presumption that the duty burden was passed on.

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