TMI Blog1999 (7) TMI 394X X X X Extracts X X X X X X X X Extracts X X X X ..... dated 27-1-1997. 2. The facts of the case are that the appellants are the manufacturers of aerated waters. When the aerated waters are sold at the wholesale market, it is being filled in bottles and transported by placing it in the plastic crates. Each plastic crate consists of 24 bottles duly filled with aerated waters and the same are filled at the factory gate with the bottles placing in the crate itself. The question involved in these appeals are, whether the crates used by the manufacturer in transporting the aerated waters will be eligible for Modvat credit or not. Before the authorities below, it was contended by the appellants that they are eligible for Modvat credit as the crates are used in or in relation to the manufacture of aerated waters which is contained in Rule 57A of the Central Excise Rules. It is contended by the department that the credit cannot be given because crates are not packaging materials and the cost of which was not included during the preceding financial year. The lower authorities did not agree with the contention raised by the assessees. Hence, the present appeals before us. As stated earlier, two appeals have been filed against the order passed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion purposes he has given the Cost Accountant certificate. The observation that it is an afterthought is very unfortunate. He says that before passing the impugned order he had given the Cost Accountant certificate and without putting the Cost Accountant certificate to examination by the adjudicating authority itself it was wrong on the part of the Collector to brush aside the Cost Accountant certificate given by him. 5. As against this Shri Suman, the ld. DR while adopting the reasonings given by the lower authorities, he specifically laid emphasise on the fact that in terms of Rule 57A, where the packing material , the cost of which was not included during the preceding financial year in the assessable value of the final product viz. aerated waters, the appellants could not have legitimate claim over it. He specifically invited our attention to the observations of the Collector where he has observed that in the price list, in Col. No. 5, nature of packing has been shown as packing material returnable and the same was not included in the wholesale price/assessable value and in Col. No. 6 the cost of packing is shown as nil. He says that in view of the specific fact, the claim ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t paragraph 1.3 the period is indicated as April, 1994 to May, 1994. After discussing various case laws, the Tribunal in paragraph 7.1.1 to paragraph 7.1.5 clearly held in favour of the assessees. As far as the difference between the cost and valuation, they have been consistently held in favour of the assessee. In paragraph 7.2 it stated that cost of an article which is repeatedly used for several times before it is exhausted has to be necessarily arrived at on pro rata basis for a single use depending upon the number of uses to which it is put generally. That is a standard costing practice and duly certified by a Chartered Accountant. To adopt any other method would be an impractical proposition and would lead to ridiculous results. 8. What will happen in cases where the assessees had submitted invoices as well as the Cost Accountant certificate? The adjudicating authority did not accept it. The authority simply says that it is an afterthought. We do not understand this. The Cost Accountant certificate as well as the invoices were on the basis of the Tribunal judgment as well as on the basis of the Rules prevalent therein viz. invoice was based on assessment. We cannot say that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the said judgment is to be considered in this order. 12. In the said judgment, in holding that such plastic crates were not packing materials covered by Rule 57A, I had held as follows : Packing materials are starting points for manufacture of boxes or containers. As such a wider purport cannot be given to this term. It is clear that the crates which are the containers for transportation did not fall within the ambit of packaging materials and as such would not qualify for the benefit of Modvat credit. 13. In dealing with this judgment, the two Member Bench in the case of Black Diamond Beverages Ltd. [1998 (103) E.L.T. 340] had observed as follows : In Amritsar Beverages v. Collector of Central Excise, Chandigarh - 1996 (85) E.L.T. 359 (Tribunal) it has been held that plastic crates used for transportation of aerated waters will not qualify for benefit of Modvat credit. This judgment of a ld. Single Member denies Modvat credit on crates on the ground that the expression packaging materials' does not cover containers, boxes etc. We state, with respect, that it is contrary to the submissions of the ld. SDR and findings of the Commissioner (Appeals) as also against Madras ..... X X X X Extracts X X X X X X X X Extracts X X X X
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