Modulation and DeModulation
As hinted out, you firstly shift signal by π by multiplying it by cos(πn). Now, your low frequency components are around π. In the next step of diagram, you filter the components around frequency 0 since the filter in diagram is lowpass. But since your signal was shifted by π, you filter the high frequency components of the original signal. In the next step, you shift your original signal back to 0 frequency.

So, overall you filter the high frequency components.