Rule 173L refund relief cannot be denied merely because returned goods are mixed with fresh raw materials during remanufacture.

Rule 173L does not require returned refractory goods to be reprocessed in isolation. Refund cannot be denied merely because the returned material was crushed and mixed with fresh raw materials for manufacture of new bricks or mortars, so long as the goods are used for remanufacture and the statutory conditions are otherwise satisfied. Loss of the original identity after processing is not, by itself, a bar to relief where the resulting product falls within the rule's scope. The assessee was therefore entitled to refund, and the objections based on exclusive use of the returned goods were rejected.

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Issues: Whether refund under Rule 173L could be denied on the ground that returned refractory goods were crushed and mixed with fresh raw materials for manufacture of new bricks or mortars, and whether the rule required the returned goods to be used alone for reprocessing or remanufacture.

Analysis: Rule 173L does not prescribe that the returned goods must be used in isolation or that no fresh material can be added during reprocessing. The decisive consideration is whether the returned goods are used for remanufacture and whether the statutory conditions are otherwise satisfied. The mixing of returned material with other raw materials, by itself, does not defeat the benefit where the process results in manufacture of goods of the same class and the identity-based objection is not supported by the rule. The earlier decisions involving the same assessee and the departmental clarification also supported the view that loss of original identity after processing does not bar relief if the rule's conditions are met.

Conclusion: The objection that refund was inadmissible because the returned goods were not used alone was rejected, and the assessee was held entitled to refund under Rule 173L.

Final Conclusion: The appeals succeeded and the assessee obtained the consequential refund relief.

Ratio Decidendi: Rule 173L does not require exclusive use of returned goods for reprocessing or remanufacture, and refund cannot be denied merely because the returned material is mixed with fresh raw materials if the statutory conditions are otherwise fulfilled.

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