Refund of duty paid under a quashed circular cannot be denied for unjust enrichment when paid under provisional assessment.

Countervailing duty collected under a circular later quashed had to be refunded because the refund obligation became unconditional once the circular was invalidated. The assessee had paid under provisional assessment and had not passed the duty burden to any third party, so unjust enrichment did not bar restitution. Interest was payable from the date the refund right crystallised, namely the date of quashing of the circular, and the provisional duty bond was liable to be released.

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Issues: Whether the petitioners were entitled to refund of countervailing duty paid pursuant to the quashed circular, release of the provisional duty bond, and interest on the refunded amount.

Analysis: The circular under which countervailing duty had been demanded was already quashed, so the respondents' obligation to refund the amounts paid under it had become unconditional. The petitioners had paid duty only under provisional assessment and were not in a position to pass on the duty burden to any third party. On those facts, the doctrine of unjust enrichment did not bar refund. Since the right to refund arose from the date on which the circular was quashed, interest was also payable from that date.

Conclusion: The petitioners were entitled to refund of all countervailing duty amounts paid, release of the provisional duty bond, and interest at 12% per annum from 16 October 2001 until actual payment.

Final Conclusion: The writ petition succeeded and the respondents were directed to make the refund, release the bond, and pay interest within the time fixed by the Court.

Ratio Decidendi: Where duty is collected under a circular that is later quashed, and the assessee has paid under provisional assessment without passing on the burden, refund cannot be denied on the ground of unjust enrichment and interest follows from the date the refund obligation crystallises.

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