1993 (1) TMI 180 - AT - Central Excise

Summary

Issues:
- Interpretation of Rule 173L of the Central Excise Rules regarding refund claims for goods re-processed in a different factory.
- Determining the correct factory for computing the period of six months for re-processing under Rule 173L.

Analysis:
The judgment involves an appeal against an Order-in-Appeal passed by the Collector of Central Excise, Bombay, concerning refund claims filed under Rule 173L of the Central Excise Rules for goods re-processed in a different factory. The appellants sought permission to relax the one-year condition for re-processing goods cleared between 1977 and 1978. The Assistant Collector granted permission to transfer goods to their Induri factory in Pune for re-processing. The issue arose when the Department objected to the refund claims, stating that re-processing was done after six months from the receipt of goods in the Thane factory. The Tribunal considered the permissions obtained from both the Bombay and Pune Collectorates and the location of re-processing to determine compliance with Rule 173L(3).

The Tribunal found that specific permission was granted to transfer goods to the Induri factory for re-processing, and all conditions stipulated were adhered to. The question was whether the six-month period for re-processing should be calculated from the receipt in the Thane factory or the Induri factory. The appellants argued that re-processing was done only in the Induri factory within six months of receipt there, while the Department contended that re-processing should have been done in the Thane factory if goods were sent to another factory. The Tribunal noted that Rule 173L allows defective goods to be re-processed in the same or a different factory. Since permissions were obtained for transferring goods to the Induri factory, compliance with the six-month requirement was determined based on re-processing in the Induri factory within the stipulated period.

Ultimately, the Tribunal allowed the appeal, ruling that re-processing in the Induri factory within six months of receipt there satisfied the requirements of Rule 173L. The judgment emphasizes the importance of obtaining necessary permissions and complying with conditions set by the authorities for transferring and re-processing goods under the Central Excise Rules.