- (1.) This order shall dispose of C.E.C. Nos. 12 and 13 of 2001 as common questions of law are involved. However, facts are being referred from C.E.C. No. 13 of 2001. This petition filed under Section 35G(H?) (sic) of the Central Excise Act, 1944 (for brevity, the Act') is directed against order dated 17-12-1999 (P-4), passed by the Customs, Excise and Gold (Control) Appellate Tribunal, Northern Division Bench (now known as Customs, Excise and Service Tax Appellate Tribunal') (for brevity, the Tribunal'), with a prayer to direct the Tribunal to draw statement of the case and refer the following questions of law to this Court for determination :- "(a) Whether Modvat credit is admissible under Rule 57A of the Central Excise Rules, 1944 , on glass bottles and plastic crates as packing material for aerated water when the value thereof is not included (i.e. of bottles/crates as such neither declared nor could be ascertained) in assessable value of the final product i.e. aerated water? (b) Whether the breakage of glass bottles, an admissible deduction under Section 4 of the Central Excise Act, 1944, in the light of Tribunal's decision reported as 1993 (67) E.L.T. 721 (T), could be considered as part of the assessable value of aerated water for the purpose of allowing Modvat credit on glass bottle?"
(2.) Brief facts of the case are that the assessee-respondent No. 1 are engaged in manufacture of aerated water falling under Heading Nos. 22.01 and 22.02 of the Schedule Annexed to the Central Excise Tariff Act, 1985 (for brevity, the Tariff Act') and were availing the Modvat credit on various inputs/packing material under Rule 57A of the Central Excise Rules, 1944 (for brevity, the Rules'). A show cause notice was issued to the assessee as a result of changes brought in the Budget 1994-95 with effect from 1-3-1994. Consequently it was intimated that vide Notification No. 62/94, dated 1-3-1994, the Central Excise duty on aerated water has to be charged ad valorem at specific rate as existing upto 28-2-1994. It was claimed that the assessee was not entitled to avail Modvat credit on packing material i.e. glass bottles and plastic crates. After affording opportunity of hearing to the assessee, the Adjudicating Authority confirmed the demand of Rs. 28,61,113, under Rule 57-I of the Rules and also imposed personal penalty of Rs. 5,00,000/-, under Rule 173Q(1)(bb) of the Rules (P-1). From the perusal of record it appears that similar orders were also passed by the Adjudicating Authority in the cases of other assessees' including M/s. Amritsar Beverages Pvt. Ltd., Chheharata, District Amritsar (assessee-respondent No. 1 in C.E.A. No. 12 of 2001).
(3.) Feeling aggrieved, as many as 8 appeals were filed before the Tribunal by different assessees' (including the assessee-respondent. No. 1 in the instant case and M/s. Amritsar Beverages Pvt. Ltd., Amritsar), which were heard together. After noticing the assertion of the assessee-appellants that the cost of glass bottles and plastic crates was included in the cost of aerated water, the Tribunal allowed the appeals vide common order dated 5-9-1997, holding that Modvat credit of duty shall be admissible wherever the cost of packing material, even on instalment basis, has been included in the assessable value (P-2).;