Strange markings on coffee cup after applying a texture

I have made a Coffee Cup for my latest work and when i applied a Nestle © logo on my cup, there seemed to be a bit of problem at the cup. The lower part has strange brown marks and the inside also has some sort of scratches. i dont know why this happens. I have UV mapped the textures onto the cup and i use Blender 2.57. I know it is quite vague, but if you see clearly, there are marks below the cup and inside the cup. Link to the file:
Image :


Seems to be the Solidify modifier that is causing it.
Turn it off and the issue is gone.