Modvat credit on packing bottles upheld where their value formed part of the assessable value of aerated water.

Modvat credit on glass bottles used to pack aerated water was held admissible where the assessee had filed a cost statement and declaration showing that the bottles' value formed part of the assessable value of the final product. The original authority accepted that evidence, and the appellate authority could not discard that factual finding without a sufficient basis. A reasonable view supported by relevant material could not be disturbed in appellate jurisdiction merely because another view was possible. The denial of credit was therefore unsustainable, and credit was available to the assessee.

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Issues: Whether Modvat credit on glass bottles used for packing aerated water was admissible on the footing that the cost of the bottles was included in the assessable value of the final product.

Analysis: The record showed that the assessee had submitted a cost statement and declaration to the excise authorities stating that the value of the glass bottles was included in the assessable value of aerated water, and the adjudicating authority accepted that material. The appellate authority upset that finding without a sufficient basis, even though the issue had to be decided on the evidence produced and the factual satisfaction recorded by the original authority. In appellate jurisdiction, a reasonable view based on relevant material could not be disturbed merely because another view was possible.

Conclusion: The finding denying credit was unsustainable, and the assessee was entitled to Modvat credit.

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