Rule 173L refund cannot be denied for lack of departmental verification where substantial compliance and proper accounts are shown.

Refund under Rule 173L could not be refused merely because the Department did not verify the returned goods, where the assessee had timely filed D-3 intimations and maintained an authenticated register showing receipt, reprocessing and duty-paid clearance. The tribunal treated these steps as substantial compliance with the rule's requirements for intimation of re-entry and proper account maintenance. On those facts, the alleged defect in the form of records did not justify rejection of the refund claim. The impugned orders were therefore unsustainable and the appeals succeeded.

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Issues: Whether refund under Rule 173L could be denied on the ground that the Revenue did not conduct verification of the returned goods and that the assessee's record of such goods was not in the prescribed form.

Analysis: The assessee had filed D-3 intimations within the prescribed time, the Revenue had taken samples of the returned goods, and an authenticated register was maintained showing receipt, reprocessing, and clearance of the goods on payment of duty. Rule 173L required intimation of re-entry of goods and maintenance of a proper account of the returned goods and the processes applied to them. On the facts found, the assessee had substantially complied with these requirements. Where the Department failed to carry out the verification contemplated by the rule, the refund claim could not be rejected on that basis alone.

Conclusion: The refund claims were rightly held to be maintainable and could not be denied for want of departmental verification or for the alleged defect in record-keeping.

Final Conclusion: The impugned orders were unsustainable and the appeals succeeded.

Ratio Decidendi: A refund claim under Rule 173L cannot be rejected merely because the Department did not verify the returned goods, where the assessee has timely intimated re-entry and maintained an authenticated account showing substantial compliance with the rule.

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