RULE 173L. Refund of duty on goods returned to factory

-(1) The Commissioner may grant refund of the duty paid on manufactured excisable goods issued for home consumption from a factory, which are returned to the same or any other factory for being re-made, refined, reconditioned or subjected to any other similar process in the factory:

Provided that -

(i) such goods are returned to the factory within one year of the date of payment of duty or within such further period or periods not exceeding one year, in the aggregate, as the Commissioner may, on sufficient cause being shown, permit in any particular case;

(ii) the assessee gives information of the re-entry of each consignment of such excisable goods into the factory to the proper officer in writing in the proper form within twenty-four hours of such re-entry or[within such further period not exceeding ten days, as the Commissioner may, on sufficient cause being shown, permit in any particular case, to enable the proper officer to verify the particulars of such goods within forty-eight hours of receipt of the information;

(iii) the assessee stores the said goods separately pending their being re- made, refined, reconditioned or subjected to any other similar process in the factory unless otherwise permitted by the Commissioner by an order in writing and makes such goods available for inspection by the proper officer when so required;

(iv) the amount of refund payable shall in no case be in excess of the duty payable on such goods after being remade, refined, reconditioned or subjected to any other similar process in the factory:

6 [Provided further that in relation to the declared excisable goods, for clause (ii) of the first proviso, the following clause shall be substituted, namely: - "(ii) the assessee gives information of the re-entry of each consignment of such excisable goods into the factory to the proper officer in writing in the proper form within twenty-four hours of such re-entry for within such further period not exceeding ten days, as the Commissioner may, on sufficient cause being shown, permit in any particular case.

(2) The assessee shall maintain a detailed account of the returned goods and the processes to which they are subjected, after their return to the factory in the proper form.

(3) No refund under sub-rule (1) shall be raid until the processes mentioned therein, have been completed and an account under sub-rule (2) having been rendered to the satisfaction of the Commissioner within six months of the return of the goods to the factory. No refund shall be admissible in respect of the duty paid, -

(i) in respect of opened packages containing goods with concessional rates of duty or partial exemption for the small or cottage sector, as set forth in the Schedule to the Central Excise Tariff Act, 1985 (5 of 1986) , or by a notification issued under ruleor section 5A of the Act;

(ii) if the amount of refund payable on the goods is less than rupees fifty; (iii) on goods which are disposed of in any manner other than for production of goods of the same class; (iv) on the unmanufactured tobacco from which cigars, cheroots and cigarettes so returned to the factory have been produced;

(v) if the value of the goods at the time of their return to the factory is, in the opinion of the Commissioner, less than the amount of duty originally paid upon them at the time of their clearance from the factory.

Explanation. -In this clause, "value" means the market value of the excisable goods and not the ex-duty value thereof.

(4) The Commissioner may, for reasons to be recorded in writing, relax the provisions of this rule for the purpose of admitting a claim for refund.

(5) The provisions of this rule shall not apply to excisable goods manufactured, -

(i) in a free trade zone and returned to a factory in any other place in India; or

(ii) by a hundred per cent export-oriented undertaking and returned to an- other factory in any place in India.