Should I allow a refund if they accidentally bought the wrong item?

[theguywhosellsthings]

I recently sold this item: https://www.ebay.com/itm/114239511743?ul_noapp=true#rpdCntId

Upon receiving it, the buyer said the box was damaged but the item was fine. He then went on to say that, admitting it was his own mistake, he thought this was a 510 model. The model is in the title and description.

When he asked for a refund, I told him that I understand his situation, but that I would need to charge him the eBay fee, PayPal fee, and shipping fee when giving him his money back. I then recommended he sell it himself at the same price I did, or higher, to make this easier on both of us. I then received this messaged: 

"Good evening and thank you for understanding. Unfortunately I have been banned from eBay for selling due to selling WW2 Memorabilia that include swastikas. So I am unable to list this but if you want to relist it and sell it and then I will ship it and you can refund my money that way or I will take 200 which will cover shipping and PayPal fees. Let me know what you think that way we don’t have to get eBay involved."

I know eBay is very buyer-friendly. But what would be my best course of action here? The item was listed under no returns, and he admitted that he received the correct item. I definitely do not feel comfortable putting up a listing for an item I don't actually have. So should I just deny his refund request? Shipping & Ebay/Paypal fees add up to $35

[koinonia215]

Do not even consider relisting it with him mailing it.

Even though you state you don't accept returns, if he were to file an SNAD case, you would be forced to accept it back and would have to give a full refund. If you didn't cooperate, he might get to keep the item and receive a full refund and you would still have to pay the final value fee. If he opens a PayPal case, he would have to return it at his expense and then you would have to give a full refund.

Have you considered allowing him to return it at his own expense and then refund in full? You would receive your ebay final value fee back, but would have to lose the PayPal fees. If you issue a partial refund, you won't be credited for any final value fee. Listing items as no returns accepted has backfired on many sellers.