Returned duty-paid goods under Rule 173H may be cleared without duty if no manufacturing process is undertaken.

Rule 173H of the Central Excise Rules, 1944 permits returned duty-paid excisable goods to be retained and cleared without fresh duty where they are not subjected to any process amounting to manufacture. The text states that duty is therefore not attracted merely because such goods are received back from a customer and cleared without reprocessing amounting to manufacture. It also notes that an appeal dismissed for failure to make full pre-deposit was not maintainable on a prima facie view, and the dismissal for want of deposit was set aside with remand for decision on merits without insisting on deposit.

---

---

Issues: Whether duty was payable on excisable goods received back from a customer and cleared without reprocessing amounting to manufacture under Rule 173H of the Central Excise Rules, 1944, and whether dismissal of the appeal for non-deposit was justified.

Analysis: Rule 173H permits receipt back and retention of duty-paid excisable goods in the factory or warehouse in the circumstances specified in the rule. The goods may be removed without payment of duty where they are not subjected to any process amounting to manufacture. On a prima facie view, duty was therefore not payable on such goods merely because they were received back and cleared without reprocessing amounting to manufacture. The order dismissing the appeal for failure to make the full deposit was also found not to be maintainable.

Conclusion: The dismissal for want of deposit was set aside, and the matter was remanded for disposal on merits without insisting on any deposit.

Ratio Decidendi: Under Rule 173H of the Central Excise Rules, 1944, duty is not attracted where returned duty-paid goods are not subjected to a process amounting to manufacture before clearance.

---