Finally had a message from the seller on ebay:
Dear Sir:
Oh, so sorry for my late answer.
I have a bad cold from last week.
This is a one man business. so I fail to process your request until today.
You do not connect it right way, not a defect.
In -> connect to signal source. .
Out --> connect to your signal input of your circuit board.
G -> ground.
You must connect it wrong way.
It is ok, If you fail to use it.
I will issue full refund to you.
Sincerely, Kevin
He must think I'm an idiot! Think I know how to wire up the PCB on the volume control.