Unjust enrichment bars refund on finalised provisional assessments where duty incidence was passed on under the amended refund regime.

Refunds arising on finalisation of provisional assessment were treated as falling within the amended statutory refund regime under Section 11B of the Central Excise Act, including the bar of unjust enrichment. The later amendment to Rule 9B(5) was regarded as clarificatory and consistent with that statutory position. A refund application filed after the amendment had to be examined under the amended law, so where the duty incidence had been passed on to customers, the claim could not succeed.

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Issues: Whether refund arising on finalisation of provisional assessment under Rule 9B(5) of the Central Excise Rules, 1944 could be denied by applying the doctrine of unjust enrichment under Section 11B of the Central Excise Act, 1944 when the refund application was filed after the amendment to Rule 9B(5), but the assessment was finalised before that amendment.

Analysis: The refund arose on finalisation of provisional assessment on 8 June 1999. The Court held that, after the amendment to Section 11B by Act 21 of 1998, refunds arising on finalisation of provisional assessment were brought within the statutory refund procedure under Section 11B, including the requirement that the incidence of duty not be passed on. The later amendment to Rule 9B(5) on 25 June 1999 was treated as clarificatory and consistent with the earlier statutory position under Section 11B. The Court distinguished the decisions relied on for the assessee on the ground that they concerned refunds arising before the 1998 amendment to Section 11B. It further held that a refund application filed on 1 November 1999 had to be dealt with under the amended law, and the assessee, having passed on the duty to its customers, could not escape the bar of unjust enrichment.

Conclusion: The doctrine of unjust enrichment applied, and the refund claim was liable to be rejected; the issue was answered against the assessee and in favour of the Revenue.

Ratio Decidendi: Refunds arising on finalisation of provisional assessment after the amendment to Section 11B are governed by the statutory refund procedure under that section, and where the incidence of duty has been passed on, the claim is barred by unjust enrichment.

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