Refund under excise law cannot reopen self-assessment, and unjust enrichment bars relief without proof of duty burden

Refund proceedings under excise law cannot be used to reopen an unchallenged self-assessment or seek fresh re-determination of duty; the refund authority must proceed on the existing assessment, and the challenge to valuation could not be entertained in that forum. The claimant also had to prove that the duty incidence was not passed on to another person to avoid unjust enrichment, and contemporaneous records supported the statutory presumption that the burden formed part of sale realisation. Later material was insufficient to displace that presumption, so the refund claim failed.

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Issues: (i) whether a refund claim under the Central Excise Act could be used to question an unchallenged self-assessment and obtain re-determination of duty; (ii) whether the appellant discharged the burden of proving that the incidence of duty had not been passed on so as to avoid the bar of unjust enrichment.

Issue (i): Whether a refund claim under the Central Excise Act could be used to question an unchallenged self-assessment and obtain re-determination of duty.

Analysis: Refund proceedings were treated as executionary in nature and not as a forum for fresh assessment or re-assessment on merits. The self-assessment made at clearance had not been appealed against or modified in the statutory manner, and therefore the refund authority could not reopen the assessment issue while considering the refund claim. The challenge to the valuation basis could not be sustained in refund proceedings.

Conclusion: The issue was decided against the assessee.

Issue (ii): Whether the appellant discharged the burden of proving that the incidence of duty had not been passed on so as to avoid the bar of unjust enrichment.

Analysis: The statutory scheme places the burden on the claimant to establish that duty was borne by it and not passed on to any other person. The presumption under the excise law and the surrounding documents at the time of clearance supported the view that the duty incidence had been included in the sale realization. Subsequent material, including a later certificate, was not accepted as sufficient to displace the statutory presumption or the contemporaneous record. The refund claim therefore failed the test of unjust enrichment.

Conclusion: The issue was decided against the assessee.

Final Conclusion: The refund claim was not maintainable on the facts and law applied, and the dismissal of the appeal was sustained because the assessment could not be reopened in refund proceedings and the statutory bar of unjust enrichment was not overcome.

Ratio Decidendi: A refund claim under excise law cannot be used to circumvent an unchallenged assessment, and refund is payable only when the claimant proves, in terms of the statutory presumption, that the duty burden was not passed on to another person.

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