You can ask the buyer to make you a payment direct to your Paypal account. As you have a transaction history with him, there shouldn't be any problem in providing your email address. Alternatively, you can ask him to return the item to you, and offer to pay his return postage costs.
It's may not be as simple the buyer getting a "free" item. He may have needed it by the date suggested by eBay's EDDs. He may have had to purchase a replacement, if your item didn't arrive on time. In many cases, the buyer no longer has any use for the item when it finally arrives.
Regrading the initial refund, your buyer allowed over a fortnight for delivery before opening a case, which then allowed you another couple of days. I don't think anyone would disagree that three weeks was quite long enough, and that the buyer, at that time, was entitled to a refund.
Although it doesn't seem to happen as often as before, your own case is not unusual with transactions involving shipping to Italy. Italy has a notoriously bad postal service. I have Italian relatives who tell me it is more or less a "national pastime" to order items from abroad, knowing they will be able to claim refunds for the significant number which fail to arrive by their promised date.
You may have fallen victim to this "scam". Or you buyer may be perfectly honest, and perfectly willing either to repay you or to return the item.
