Rule 173L(3) time limit runs from receipt at the approved transferee factory for reprocessing of returned duty-paid goods.

For Rule 173L(3) of the Central Excise Rules, the six-month period for reprocessing returned duty-paid goods is to be counted from the date the goods are received at the factory specifically permitted by the Department for reprocessing. Where defective goods were transferred from the first receiving factory to another approved factory, and the permission conditions were not shown to have been breached, the transferee factory remained the relevant factory for computing time. Reprocessing and accountal completed within six months from receipt at that factory satisfied the rule, so refund claims could not be rejected as time-barred for delayed reprocessing.

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Issues: Whether, for the purpose of Rule 173L(3) of the Central Excise Rules, the six-month period for reprocessing and accountal of returned duty-paid goods is to be computed from the date of their receipt in the first factory where they were initially received, or from the date of their receipt in another factory to which transfer for reprocessing was specifically permitted by the Department.

Analysis: Returned defective goods were initially received at one factory, but the Department granted specific permission for their transfer to another factory for reprocessing, subject to conditions, and there was no finding that those conditions were violated. In such circumstances, the approved factory for reprocessing was the transferee factory, and the statutory period under Rule 173L(3) had to be reckoned from the date of receipt of the goods at that factory. Since reprocessing and accountal were completed within six months from that date, the requirement of the rule stood satisfied.

Conclusion: The six-month period under Rule 173L(3) was correctly computed from the date of receipt of the goods at the transferee factory, and the refund claims were not liable to be rejected on the ground of delayed reprocessing.

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