Provisional Excise Refund and Appeal Sanction Requirements: refund survives unjust enrichment, while appeal authorisation needs prior informed approval.

Refund arising from finalisation of a provisional excise assessment was treated as outside the mischief of unjust enrichment and not barred by Section 11B where the duty had been paid provisionally under bond and the claim was filed within time after final assessment; the refund was therefore admissible. The departmental authorisation to appeal was invalid because the sanction was signed before the annexed grounds of appeal came into existence, showing that the Commissioner had not considered any existing grounds or applied an informed mind to the impugned order; the statutory requirement under Section 35B(2) was not met.

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Issues: (i) Whether refund arising on finalisation of a provisional excise assessment is barred by unjust enrichment or by Section 11B of the Central Excise Act, 1944. (ii) Whether the departmental authorisation to file the appeal was validly made under Section 35B(2) of the Central Excise Act, 1944.

Issue (i): Whether refund arising on finalisation of a provisional excise assessment is barred by unjust enrichment or by Section 11B of the Central Excise Act, 1944.

Analysis: The duty had been paid on a provisional basis, backed by a bond undertaking to pay differential duty on final assessment. After finalisation, the amount was found refundable to the manufacturer. A refund flowing directly from finalisation of provisional assessment is outside the mischief of unjust enrichment and is not hit by Section 11B in the manner contended by the Revenue. The refund claim was made within the statutory period after final assessment.

Conclusion: The refund was admissible and the order directing refund was correct.

Issue (ii): Whether the departmental authorisation to file the appeal was validly made under Section 35B(2) of the Central Excise Act, 1944.

Analysis: The authorisation referred to an annexure containing grounds of appeal, but the annexure came into existence only after the authorisation had been signed. This showed that the Commissioner had accorded sanction without considering any existing grounds and without applying his mind to the legality or propriety of the impugned order, which did not conform to the statutory requirement.

Conclusion: The authorisation was not validly made in accordance with Section 35B(2) of the Central Excise Act, 1944.

Final Conclusion: The appellate order granting refund was upheld and the Revenue's challenge failed.

Ratio Decidendi: A refund arising from finalisation of a provisional excise assessment is not defeated by unjust enrichment principles, and departmental sanction to appeal must be based on an existing, considered application of mind to the grounds of challenge.

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