Substantial question of law requirement bars interference with factual finding on packing material value and Modvat credit

An appeal under section 35-G of the Central Excise Act lies only on a substantial question of law, so the High Court will not disturb concurrent factual findings unless they are perverse or otherwise infirm. On the evidence, the authorities had found that the cost of glass bottles, crown corks and other packing materials formed part of the assessable value of aerated water, supporting Modvat credit. That determination was treated as a finding of fact, and no perversity was shown in the appraisal of the cost certificate and computation sheets. The revenue's challenge therefore failed because no substantial question of law arose.

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Issues: Whether the appeal under section 35-G of the Central Excise Act, 1944 raised any substantial question of law, the controversy being whether the assessee had established inclusion of the cost of glass bottles and crown corks in the assessable value so as to qualify for Modvat credit.

Analysis: The dispute turned on whether the value of packing materials was included in the assessable value of the aerated water, which the authorities below had found on appreciation of the cost certificate and computation sheets. That finding was treated as one of fact. In the absence of perversity or infirmity in the factual findings, the High Court's jurisdiction under section 35-G was confined to questions of law only. The record did not disclose any such perversity, and the Court found no basis to reopen the factual determination merely because the revenue disputed the evidentiary appraisal.

Conclusion: No substantial question of law arose, and the appeal was liable to fail.

Final Conclusion: The factual finding that the packing material value formed part of the assessable value stood undisturbed, and the revenue's challenge was not maintainable under section 35-G.

Ratio Decidendi: An appeal under section 35-G of the Central Excise Act, 1944 lies only on a substantial question of law, and where the dispute is confined to a factual finding that is neither perverse nor infirm, the High Court will not interfere.

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