Cadbury Excise Duty Evasion: Over 570 Crore Demand Against Confectionary Giant

NEW DELHI: A demand of over 570 crore has been raised against confectionery giant Cadbury India Ltd for allegedly evading excise duty by fraudulently taking exemption for one of its 'ghost' production units in Himachal Pradesh.

The Directorate General of Central Excise Intelligence (DGCEI) had in 2011 initiated a probe against the company for allegedly misusing 'area-based exemption' for its new unit in Baddi, Himachal Pradesh even before it came into existence, official sources said. After completion of its investigation, the DGCEI had slapped a show-cause notice to the firm demanding about 250 crore against excise duty evasion, they said.

The demand was contested and the central excise office of Chandigarh had late last month issued an assessment-cum-demand notice to Cadbury India Ltd (now Mondelez India Foods Private Limited) upholding the demands raised by the DGCEI. It has demanded from the firm 574 crore towards alleged excise duty evasion -- including 231.47 crore for the period from July 28, 2010 to January 31, 2013, 111.36 crore for the period from February 1, 2013 to December 31, 2013 and a penalty of 231.47 crore, according to the demand order.

Further, a penalty of 1crore has also been imposed against Anand Kripalu, Managing Director of Cadbury India Ltd for allegedly violating central excise rules, the order said. In addition, penalties to the tune of several lakhs of rupees have been imposed on a few present and former employees of the company.

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