Strict compliance under Rule 173L governs refund of duty on returned goods; procedural lapses cannot be ignored.

Refund under Rule 173L is available only where returned manufactured goods are brought back for remaking, refining or reconditioning in strict compliance with the prescribed safeguards, including prior intimation, separate storage, maintenance of detailed accounts and production of duty-paying documents. The rule protects revenue because returned goods must be distinguishable from fresh clearances. Relaxation is permitted only by the Principal Collector, for recorded reasons, and the Commissioner (Appeals) has no power to ignore the mandatory conditions or treat non-compliance as inconsequential. On the stated facts, refund was not admissible and the order granting it was unsustainable.

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Issues: Whether refund of duty under Rule 173L could be granted despite non-compliance with the prescribed procedure and whether the appellate authority could condone the failure to maintain the required records and documentation.

Analysis: Rule 173L permits refund only in respect of manufactured goods returned to the factory for remaking, refining, reconditioning or similar processes, subject to mandatory conditions including intimation to the department, separate storage, maintenance of detailed accounts and production of duty-paying documents. The rule is designed to protect revenue because returned goods may otherwise be difficult to distinguish from newly manufactured goods cleared without duty. The provision expressly contemplates relaxation only by the Principal Collector for reasons recorded in writing. In the absence of compliance with the basic requirements, the appellate authority had no power to ignore the statutory safeguards or to treat the procedural lapse as inconsequential.

Conclusion: Refund was not admissible. The assessee's non-compliance with Rule 173L could not be condoned by the Commissioner (Appeals), and the order granting refund was unsustainable.

Ratio Decidendi: Refund under Rule 173L is available only on strict compliance with the prescribed conditions, and relaxation of those conditions can be granted only by the authority specifically empowered by the rule.

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