what do you tell the customer if they send back the product and it is not in resellable condition and used?
If you receive a used item, contact the customer (email is best, as it's documented), explain that it doesn't meet your return policy (give them the URL to your policy), and what would you like us to do with this package?
If you've previously vetted their explanation, and given them a return authorization number, then they either lied about the condition of the item, or you didn't check their story good enough (in which case, you're out of luck).
If they lied, take photos of the item, send them copies, and ask how they wish to dispose of the package. Do not pay to ship it back; if they want it back, they should pay. Otherwise, throw it in the trash.
If they simply returned a used item with no prior communication, throw it in the trash. You have proof of prior delivery, they didn't contact you, they returned an empty package, and they have no right to a refund or a chargeback claim.