First, posting in caps is considered shouting and quite rude.
No returns is not the same as no refunds.
Tell the customer to return the item for a full refund. If you have a serial number, you could mention it in the reply.
When the item arrives, refund.
Not every transaction goes smoothly.
What if you refuse the return and the refund?
The buyer can open a Dispute and return the item. Once Paypal sees that you have it back, they will refund the buyer and come after you for the money.
You will have a defect/violation/black mark on your selling record.
The unhappy buyer may leave poor feedback and trash your Detailed Seller Ratings.
Oh. And from time to time we see reports that PP has decided that 'no returns' means the seller never wants to see the item again and does the refund without requiring the return.
So.
Tell the customer to return the item as politely as you can. When it arrives refund.
Relist it. Sell it to a more amenable customer.
