I figured it out. In my case I had slightly torn the ribbon cable connecting the HD to the Logic Board. It's a bit of a design flaw - the cable bends in two opposite directions and so when you take it off it's very easy to tear it which renders the HD useless when in the computer.

The drives work fine in external enclosures but not in the Mac - that is the reason why.

I bought a replacement cable from The Bookyard, which is a Mac parts specialist in the UK. They sent me a replacement overnight, i fitted it today and it worked immediately.

Happy days - hope that helps other folks with the same issue

PJM