Refundable deposit in excise adjudication: post-clearance payment was not duty, and unjust enrichment could not bar refund.

A payment made during pending excise adjudication after clearance of goods, in response to a disputed enhancement of assessable value, was treated as a refundable deposit rather than duty. The procedure applicable to duty paid under protest did not govern such a post-clearance deposit, because it was not paid at the point of removal. The Court further held that unjust enrichment could not be invoked without evidence that the amount had been recovered from consumers as duty. Refund with interest was therefore available to the assessee.

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Issues: Whether the amount paid by the assessee during adjudication, after clearance of the goods and pursuant to a challenge to the enhanced valuation, was a deposit or duty, and whether refund of that amount could be denied by invoking the procedure for duty paid under protest and the doctrine of unjust enrichment.

Analysis: The amount was paid after clearance of the goods in the course of disputed adjudication on undervaluation, not as duty at the time of removal. The statutory scheme governing payment under protest applies to duty paid at the stage of clearance, and its procedural requirements do not govern a later deposit made during pending proceedings. Since the demand itself arose from the Revenue's attempt to enhance the assessable value, the amount deposited pending adjudication was not treated as duty collected from consumers. The Court also held that the Revenue failed to establish any basis for applying unjust enrichment against the assessee in respect of this deposit.

Conclusion: The amount paid by the assessee was a deposit and was refundable with interest in favour of the assessee.

Ratio Decidendi: A payment made during pending excise adjudication, after clearance of goods and not as duty at the point of removal, is a refundable deposit and is not barred by the procedure for protest payments or by unjust enrichment unless the Revenue establishes that the amount was in fact duty recovered from consumers.

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