Actually, that method for returns was pretty common and I don't see much wrong with it. My house has it. Follow the covered joists out and you'll get to a duct or the furnace.

Heat dumped in the basement can't be all bad. It's in the house and is going to rise anyhow. I'm not even sure you'll need returns from the basement. I'd try it without, first.

Upstairs may require a little adjustment and maybe not.

thanks...when you say follow the joists out...the covered joist goes up to the mid point of the basement were the joist cavity has a square plate making it sealed...should I cut a square hole in the covered part and put a vent cover there?

I was hoping a return will assists with moving air around being my supply ducts are not optimal. And hoping it will provide benefits in the summer with basement humidity.

I suggested following the joists, so you could satisfy yourself, as to how it got back to the furnace.

You can try opening an area of the return. If it doesn't work out, it can be resealed.

"And hoping it will provide benefits in the summer with basement humidity."

What is your basement wall/foundation. What is the source of the humidity?

I would put the returns down at floor level. If you put them in the ceiling, the warm air that is delivered to the room will rise to the ceiling and be sucked back into the heating system through the ceiling mounted returns.