If the buyer has been reimbursed without returning the item without your consent (as long as you haven't forfieted by not responding to the return request in time, etc) this is illegal and also contravenes ebay's own policy:

http://pages.ebay.com.au/help/policies/money-back-guarantee.html

In particular:

When an item doesn't match the listing description

If a buyer receives an item that doesn't match the listing description, the buyer needs to request a return from My eBay. The seller should address the buyer's concern and offer a solution, such as accepting a return, offering a replacement or refund.

If the buyer doesn't receive a response or solution, or returns the item but doesn't receive a refund or replacement from the seller, the buyer can ask us to step in and help.

If asked to step in and help, we review the item description and any other information about the item that the buyer and seller provide. If we can't determine that the item matches the listing description, if the seller has already offered a return, or the seller's stated return window and policy applies, we may ask the buyer to return the item to the seller.

  When an item is returned to the seller

• The buyer must return the item in the same condition in which it was received.

• The seller is required to accept the return at the same location specified in the listing.

• The cost of return postage is the seller's responsibility. For return of items with a total cost of $750 or more, we require signature confirmation.

• The seller pays for any customs charges on the returned item.

After confirming that the item was returned to the seller, we will refund the full cost of the item and original postage to the buyer. We require the seller to reimburse us for the amount. When the buyer arranges delivery or picks up the item, we may not refund the cost of original postage or pickup.

If this applies to your case.  I would be calling ebay and quoting their own policy back at them.  If you can't get any joy from the first CS rep you speak to, demand to speak to a supervisor.  This is outrageous!