refund request denied without due explanation

I made an In App purchase on a game - £100, not small change. When making payment on the app it said purchase failed. I then noticed that iTunes in fact took payment but the item was not received. Spoke to Apple support rep who processed and put forward for a refund. I then got the dreaded response “Your refund has been denied”...

i contacted the item supplier who have me an official letter that has been presented to Apple that they did not supply the item nor have they received an order from iTunes requesting the item on my behalf!

I contacted Support a second time after I now requested a refund on the Apple site. Support shut me down and told me to vist their “terms and conditions” as a sale is final. As far as I understand Sales 101, if an item has not been supplied how can a sale be final?

Are there any alternative avenues I can use before I approach the Financial Ombudsman to resolve this issue.

This was clearly a case of a tech issue between iTunes and the supplier and neither will accept responsibility BUT Apple has money for goods not supplied.

Any solution?