Returned duty-paid goods for repair fall under Rule 173H, not Rule 173L, when no manufacture is involved.

Goods returned solely for repair and rectification, where the process did not amount to manufacture, were held to fall under Rule 173H of the erstwhile Central Excise Rules, 1944, not Rule 173L. Rule 173L, which governs remaking, refining, reconditioning or similar factory processes, was therefore inapplicable to the returned duty-paid defective goods. On that basis, the refund claim under Rule 173L was found not maintainable, the Revenue's position was accepted, and the order granting refund was set aside.

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Issues: Whether the goods returned for repair and rectification were covered by Rule 173L of the erstwhile Central Excise Rules, 1944, or by Rule 173H of the erstwhile Central Excise Rules, 1944, and whether the refund claim was sustainable.

Analysis: The returned duty-paid goods were sent back only for repair and rectification. The earlier decision in the same respondent's case had held that such process did not amount to manufacture, and that duty-paid defective goods cleared for repair had been dealt with under Rule 173H. In that setting, the provisions governing remaking, refining, reconditioning, or similar factory processes under Rule 173L were held inapplicable, and the adjudicating authority's view that Rule 173H governed the matter was upheld.

Conclusion: The refund claim under Rule 173L was not maintainable and the matter was rightly governed by Rule 173H. The Revenue succeeded.

Final Conclusion: The order allowing refund was set aside and the adjudication order was restored.

Ratio Decidendi: Goods returned solely for repair and rectification, where the process does not amount to manufacture, are to be dealt with under Rule 173H and not Rule 173L of the erstwhile Central Excise Rules, 1944.

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