Unjust enrichment does not bar refund of excess customs duty paid by mistake when the overpayment was not passed on.

Refund of excess customs duty on de-bonded goods was not barred by unjust enrichment where the sale price was stated to be inclusive of duties and taxes, because that stipulation was treated as covering only the lawful duty element. The Tribunal held that the presumption that a composite price includes duty payable does not extend to duty paid in excess by mistake. As the excess duty was not shown to have been recovered from the purchaser, unjust enrichment did not apply and the refund claim was allowed.

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Issues: Whether refund of excess customs duty paid on de-bonded goods was barred by unjust enrichment on the footing that the sale price included all statutory levies.

Analysis: The Tribunal held that while a composite sale price may legitimately be presumed to include the duty actually payable, that presumption does not extend to duty paid in excess by mistake. A stipulation that the price is inclusive of all duties and taxes is understood as covering only the lawful duty element, and does not mean that an overpayment of duty has been passed on to the buyer. On the facts, the excess customs duty was not shown to have been recovered from the purchaser, so the bar of unjust enrichment did not apply.

Conclusion: The refund claim was not hit by unjust enrichment and was allowed in favour of the assessee.

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