I have a Handi Rifle, serial HX 3082XX, with sporting-taper barrel and stained birch stocking, chambered to the .223 Remington cartridge. This rifle is mated to a 3 x 9 40mm Tasco Bucksight scope using medium-height Leupold aluminum ring mounts.
Prior to shooting the rifle, I cleaned the bore throughly with an old product that Remington used to market as Remington Bore Cleaner. This stuff feels kind of like "Soft Scrub" household cleaner. I also used Simple Green to degrease the locking surfaces of the rifle. I removed the scope mounting base, degreased it and the barrel, and re-installed it using blue Loc-Tite brand thread locking adhesive.
Initial shooting was done with Remington / UMC 55gr. FMJ and the results were dismal. The rifle patterned, rather than grouped, through two boxes of the stuff. It started to settle down a bit through the third and fourth boxes. I used the fifth box to fire four groups of five shots each that would go into the rifle's range notebook for future comparison. The smallest of those was 2.00" c-t-c and the largest was 3 7/8" c-t-c.
I aquired 100 rounds of Winchester USA 62 gr FMJ for the next outing. It made all of the difference in the world. The rifle is a solid MOA shooter with that fodder. It also happens to shoot Federal's 60 gr Partition load in .223 equally well, and, as an added bonus, it shoots them to the same 100 yard point of aim.
The list of factory fodder this rifle likes is a short one. The list of stuff it doesn't like is very, very long. It remains entirely capable of shooting very large groups with ammo it doesn't like.
My advice to the original poster would be that he try a variety of loads before giving up on the rifle. He might find a couple, as I did, that turn his Handi-Rifle from a not exactly inexpensive mistake to a rewarding piece of kit that is satisfyingly accurate and very pleasurable to shoot.
JP