Rule 173L refund entitlement for duty-paid goods returned for reprocessing remains valid despite later export under bond.

Refund of central excise duty under Rule 173L was admissible where duty-paid footwear was returned to the factory for remaking or reprocessing and the prescribed receipt conditions were complied with. The later export of the reprocessed goods under bond did not defeat the refund entitlement, because the rule operates on the return of duty-paid goods for specified processing and limits refund only to the duty payable after such processing. The view that export at nil duty barred refund was held not to govern the claim under Rule 173L, and the refund rejection was set aside with consequential relief.

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Issues: Whether refund of central excise duty was admissible under Rule 173L of the Central Excise Rules, 1944 on duty-paid goods returned to the factory for remaking or reprocessing and later exported under bond.

Analysis: Duty-paid footwear was returned to the manufacturer for reprocessing and the procedural requirements for receipt of returned goods were complied with. The rule permits refund once duty-paid manufactured goods are returned to the factory for being remade, refined, reconditioned or subjected to similar process, and the refund is not to exceed the duty payable after such processing. The subsequent export of the reprocessed goods under bond did not alter the entitlement arising from the return of the goods to the factory. The earlier view denying refund on the ground that the exported goods attracted nil duty was held not to govern the entitlement under Rule 173L.

Conclusion: Refund was admissible and the assessee's appeal succeeded.

Final Conclusion: The order denying refund was set aside and the duty refund claim was allowed with consequential relief.

Ratio Decidendi: Under Rule 173L of the Central Excise Rules, 1944, refund becomes admissible when duty-paid goods are returned to the factory for remaking or similar processing and the prescribed conditions are complied with, irrespective of the later clearance of the reprocessed goods under bond.

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