Refund under Rule 173L cannot be denied for lack of detailed rejection reasons when defect and reconditioning were disclosed.

Refund under Rule 173L of the Central Excise Rules, 1944 could not be denied merely because the assessee did not explain why customers rejected the goods or set out the reconditioning process in elaborate detail. The provision did not require disclosure of the reasons for rejection, and the record showed that the department was informed the goods had a colour defect, that the defect was rectified by blending, and that the required D-3 intimation was furnished on receipt of the goods for reprocessing. On that basis, the rejection of the refund claim was unsustainable and the refund was payable.

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Issues: Whether refund under Rule 173L of the Central Excise Rules, 1944 could be denied on the ground that the reasons for rejection of the goods and the process undertaken for reconditioning were not sufficiently explained to the department.

Analysis: The refund was rejected on the premise that the assessee had not explained why the goods were rejected by customers and had not specifically described the process adopted for reconditioning. The provision did not require the assessee to state the reasons for rejection of the goods. The record also showed that the assessee informed the department that the goods suffered from a colour problem and that the defect was rectified by blending, and the required D-3 intimation was furnished on receipt of the goods for reprocessing.

Conclusion: The rejection of the refund was unsustainable and the assessee was entitled to the refund claim.

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