Seller won't pay full postage.

I have a Chinese seller who is playing me. The sale was deficient an item that would cost £19 to buy. He offered to send it and a £5 refund if I withdrew my open issue.  Clearly, I asked for resolution first.  After much prevarication hetold me to return the item for a refund - and sent £3.82 to PayPal for postage costing £10.45.  I'm at Day 18 - so only 3 days left - but with the item marked for return, I cannot open a case with ebay to step in. If I sent the item, I'm £7 further out of pocket with almost no chance that the seller will confirm receipt of the item and refund me. How do I resolve? 

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You’ll need to call eBay, tell them the whole story and ask to escalate