Decided on July 09,1991



R. Jayaraman, Member (T) - (1.) THIS appeal is directed against the order passed by the Collector (Appeals) bearing No. M -498/BD -291/96, dated 26 -11 -1986 rejecting the appellants'appeal.
(2.) THE facts of the case are that the appellants being the manufacturers of medicaments, removed on payment of duty certain medicines (76,800 bottles) in January -February 1983. They were found to have been crystallised and hence were required to be reprocessed. Hence the goods have been called back. A quantity of 57,459 bottles were received and at the time of their receipt in their factory, D -3 declaration was furnished and they were taken into the prescribed record. Thereafter, they were issued for reprocessing after assigning the batch numbers. The goods were reprocessed and 53,514 bottles were cleared on payment of duty again and hence refund claim has been filed under Rule 173L, which was rejected by the Asstt. Collector, on the ground that the appellants have mixed the goods received for reprocessing with other non -duty paid goods and no separate reprocessing of the goods received has been carried out as required under Rule 173L. The claim was rejected only on the ground that the receipted goods have not been reprocessed separately. When the matter was taken in appeal, the Collector (Appeals) rejected the claim on the ground that the appellants did not maintain account for duty paid returned goods in terms of Rule 173L(2). The present appeal is against the aforesaid order.
(3.) SHRI Parakh, the Ld. advocate on behalf of the appellants, pleaded that there is no stipulation under Rule 173L that the goods returned back should be reprocessed separately. The only requirement is to store the goods separately and for maintaining proper account in the prescribed form. He also took me through the relevant register showing the quantity returned and removed for reprocessing and batch Nos. given for reprocessing and the corresponding batch numbers of final products. In view of this, he contended that proper accounting has been rendered for the returned quantity and in the absence of any stipulation to the effect that the returned goods have to be reprocessed separately, the Asstt. Collector is not justified in rejecting their refund claim. In view of the fact that the goods have been received under proper D -3 declaration and the receipt of the goods also have been duly recorded in the register with proper co -relation to the finished product, proper account has been rendered. Mrs. Lipika M. Roy Choudhury, the Ld. SDR on the other hand contended that once the goods are mixed up with the other non duty paid goods, the accountal of the returned goods for reprocessing is not possible. She, therefore, pleaded that in the absence of proper accountal of the goods returned for reprocessing of the goods, the condition prescribed under Rule 173L is not fulfilled.;

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