RULE 97A. Goods cleared for export may be allowed to be returned to factory

(1) The Commissioner may allow manufactured excisable goods cleared for export under claim for rebate or in bond, but not exported for any reason, to be returned to the same or any other factory for being remade, refined, re-conditioned, or subjected to other similar process in the factory provided that -

(i) the 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) at least 48 hours notice is given to the proper officer before the goods are received into the factory;

(iii) the goods are presented, before they are taken into stock to the proper officer for inspection, and if necessary , for taking samples;

(iv) the goods are identified to the satisfaction of the Commissioner; (v) the goods, as originally issued from the factory, are not found to have been tampered with in any way, and the smallest packages meant for retail sale are intact and unopened; :

(vi) the value of goods at the time of their return to the factory is in the opinion of the Commissioner, not less than the amount of duty originally paid 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;

(vii) the amount of duty originally paid or covered by the bond is not less than rupees fifty; and

(viii) 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 factory records.

(2) (i) No refund shall, however, be admissible in respect of the duty paid -

(a) on goods which are disposed of in any manner otherwise than for production of goods of the same class;

(b) on the unmanufactured tobacco from which cigars, cheroots, cigarettes, chewing tobacco, snuff or biris so returned to the factory have been produced.

(ii) No refund shall be paid until the processes mentioned in sub-rule (1) have been completed, and an account under clause (viii) of the proviso thereto has been rendered, to the satisfaction of the Commissioner within six months of the return of the goods to the factory:

provided that 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.

(3) Where the goods were cleared for export in bond, full duty shown on the clearance document shall be recovered if such goods are disposed of in any manner otherwise than for production of goods of the same class.

(4) After the processes mentioned in sub-rule (1) have been completed, the goods shall be cleared subject to the procedure prescribed in these rules in this regard.

1(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 another factory in any place in India.