There are two things that are likely; 1. The axle spindle bushing is worn. 2. The axle isn't centered in the spindle.
The spindle bushing can be had from Marlin Crawler for less than the dealer. If the spindle bushing is worn, it will allow the front axle to chew up the inner seal. I have not seen this groove on the front inner axles on any that I have worked on.
They are made of bronze and will need to be reamed to fit.
If the axle isn't centered, the seal will get chewed up quickly as well.
The axle centering SST is available from different sources for about $80-$90
Are both sides leaking after rebuild? I would obtain the tool, bushings, and new seals, then rip the axle down, replace bushings and check the axle centering.
Good luck!
Danny