Excise refund and unjust enrichment: refund allowed in cash or ledger credit where duty burden was not shown to be passed on.

Refund claims under excise law require proof that the duty incidence was passed on to the customer before crediting the amount to the Consumer Welfare Fund. The contract language was read as covering only duties actually leviable, and the specific clause referred only to sales tax and octroi, not Central Excise duty. As the department did not establish that excisable goods had emerged in the appellant's hands or that the lump sum price included any excise duty element, the surrounding correspondence and prior dispute supported the conclusion that the burden had not been shifted. The finding of unjust enrichment was set aside and refund was allowed in cash or by credit to the Personal Ledger Account.

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Issues: Whether the refund amount was liable to be credited to the Consumer Welfare Fund on the ground that the appellant had passed on the excise duty burden to its customer, or whether the appellant was entitled to receive the refund in cash or as credit in its Personal Ledger Account.

Analysis: The contract and schedule of rates were examined to determine whether the lump sum price included excise duty. The general recital that rates were inclusive of all duties and taxes was held to cover only duties actually leviable, while the more specific contractual clause referred only to sales tax and octroi and did not expressly provide for Central Excise duty. The department had not established that excisable goods had emerged in the appellant's hands or that the cost structure of the lump sum price included any amount towards excise duty. In the circumstances, the surrounding correspondence and the prior dispute over dutiability supported the appellant's case that the duty burden had not been shifted to the customer.

Conclusion: The finding of unjust enrichment was set aside. The appellant was held entitled to refund in cash or by credit to its Personal Ledger Account, and the direction to credit the amount to the Consumer Welfare Fund was overturned.

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