RULE 173M. Goods cleared for export to be returned to the factory

(1) After intimating the 11 [Assistant Commissioner of Central Excise or Deputy Commissioner of Central Excise, the manufactured excisable goods cleared for export under claim for rebate or in bond, but not exported for any reasons may be returned to the same factory or any other factory for being re-made, refined, reconditioned, or subjected to other similar processes 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 six months 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, asthe 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) such goods are stored separately pending being re-made, refined, re-conditioned or subjected to other similar processes in the factory unless otherwise permitted by the Commissioner by an order in writing and are made available for inspection by the proper officer, if so required by him;

(v) a detailed account of the returned goods and the processes to which they are subjected after their return to the factory , is kept in the proper form :

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, or within such further period not exceeding ten days, as the Commissioner may, on sufficient cause being shown, permit in any particular case".

(1A) After intimating the Assistant Commissioner of Central Excise or Deputy Commissioner of Central Excise, the manufactured excisable goods cleared for export in bond, but not exported for any reasons, may be returned to the same factory for storage purposes:

Provided that –

(i) the conditions specified under Items (i) and (ii) of the proviso to sub-rule (1) are observed;

(ii) such goods are stored separately and made available for inspection by the proper officer, if so required by him;

(iii) a separate account of the returned goods is kept in the production account.

(2) No refund shall be paid until the processes mentioned in sub-rule (1) have been completed and an account under clause (iv) of that sub-rule has 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 duty paid -

(i) if the amount of duty originally paid or covered by the bond is less than rupees fifty;

(ii) if the value of goods at the time of their return to the factory is less than the amount of duty paid originally upon them or covered by the bond entered into by the owner under rule 13 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.

(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.

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

(4) 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.