Unjust enrichment and finality of duty rate govern refund claims on physician samples cleared free of cost.

Refund of excise duty on physician samples cleared free of cost was held not to be barred by unjust enrichment where the goods were not sold, the duty was shown as receivable in the books, and a Chartered Accountant's certificate supported non-passing of incidence; the refund was therefore allowable. By contrast, the claim for refund of duty paid at 6% under Notification No. 12/2012-CE failed because the applicable rate had already attained finality in the assessee's own case and in the revisionary order, so the levy was treated as correctly paid and no refund lay.

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Issues: (i) Whether refund of excise duty paid on physician samples cleared free of cost was barred by unjust enrichment. (ii) Whether duty paid at 6% on physician samples under Notification No. 12/2012-CE dated 17.03.2012 was refundable.

Issue (i): Whether refund of excise duty paid on physician samples cleared free of cost was barred by unjust enrichment.

Analysis: The refund claim was rejected only on the ground of unjust enrichment. The goods were cleared free of cost and were not sold to any buyer. The duty amount was reflected as receivable in the books of account and supported by a Chartered Accountant certificate. On these undisputed facts, the incidence of duty could not be said to have been passed on.

Conclusion: The refund of Rs. 58,59,456/- was not hit by unjust enrichment and was allowable.

Issue (ii): Whether duty paid at 6% on physician samples under Notification No. 12/2012-CE dated 17.03.2012 was refundable.

Analysis: The issue of the applicable rate of duty had already attained finality in the assessee's own case and in the revisionary order. The Tribunal treated the levy at 6% as correctly paid under the notification and held that the assessee could not claim refund on the footing that no duty was payable.

Conclusion: The refund claim for duty paid at 6% was not maintainable.

Final Conclusion: The refund dispute succeeded only in relation to unjust enrichment for the higher duty amount, while the claim for refund of duty paid at 6% failed because the applicable rate had already been settled.

Ratio Decidendi: Refund is not barred by unjust enrichment where the duty burden on free-of-cost clearances is not passed on, but no refund lies where the duty rate has already attained finality and was correctly paid under the governing exemption notification.

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