Statutory refund machinery governs indirect tax refund claims; civil suits are barred unless the levy is unconstitutional.

Refund claims for indirect tax duty are to be pursued through the statutory refund machinery, not by a civil suit, save where the levy itself is unconstitutional. The text identifies Section 11B of the Central Excise Act, 1944 and Section 27 of the Customs Act, 1962 as the governing provisions, and notes that the claimant must also prove that the duty burden was not passed on to a third party. On that basis, a civil suit for refund is treated as not maintainable where the statutory route is available and the doctrine of unjust enrichment applies.

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Issues: Whether a civil suit for refund of excise duty was maintainable in view of the Supreme Court ruling that refund claims must be pursued under the statutory refund provisions and subject to proof that the duty burden had not been passed on.

Analysis: The appeal turned on the effect of the later binding decision in Mafatlal Industries Ltd. v. Union of India, which declared that claims for refund of duty, save where the levy is unconstitutional, must be made and adjudicated under the statutory mechanism and not by a civil suit. The governing refund provisions identified were Section 11B of the Central Excise Act, 1944 and Section 27 of the Customs Act, 1962, and the claimant must also establish that the incidence of duty has not been passed on to a third party.

Conclusion: The refund suit was not maintainable and was liable to be dismissed.

Final Conclusion: The appeal succeeded, the decree in favour of the plaintiff was set aside, and the suit for refund was dismissed as not maintainable.

Ratio Decidendi: Claims for refund of indirect tax duties must be pursued only through the statutory refund machinery, and a civil suit is barred except in cases of unconstitutional levy, with the claimant also required to show that the duty burden was not passed on.

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