Once a case is opened it's all automated, no human contact, so no point challenging it at that point. Pay for the tracked return postage, on return of your item refund through the case details, then you can appeal the decision.
You'll need to prove the item was returned not in the same condition as sent out, you can direct eBay to the messages sent, describing the phone has been taken apart and other parts added. It's not easy to appeal but you have good grounds, and good proof here.
This explains the process:
https://www.ebay.co.uk/help/selling/managing-returns-refunds/appeal-outcome-case-seller?id=4369
@sasamen2012