Cadbury’s duty evasion on radar

New Delhi, Feb. 23: In the second major case involving a foreign company under its probe, the Central Vigilance Commission (CVC) is investigating alleged excise duty evasion to the tune of about `580 crore by confectionery giant Mondelez, maker of Cadbury chocolates.

CVC sources said on Tuesday the anti-corruption watchdog is also looking into the role of central and state government officials who might have facilitated the alleged evasion. An investigation has been started by the Commission in the case, they said, adding some documents have also been sought from the company.

There are allegations that certain government officials might have helped the company in allegedly evading the excise duty, the sources said. It is the second big case being probed by the CVC involving a foreign private company. USretail giant Wal-Mart has come under the scanner of the CVC amid allegations that it gave bribes to government officials to get customs clearances and obtain permits to set up stores in India. A Mondelez India spokesperson said on Tuesday they will cooperate with all the authorities concerned.

“A compliant and ethical corporate culture, which includes adhering to laws and industry regulations in all jurisdictions in which we do business, is integral to our success. We firmly believe that the decision to claim excise tax benefit is valid and that our executives acted in good faith and within the law in the decision to claim excise benefit in respect of our plant in Baddi. We will cooperate with all authorities to address this matter through the administrative and judicial process. It would be inappropriate for us to comment at this time since the matter is in the legal domain,” it said.

A demand of about `580 crore was raised last year against Mondelez India Foods Pvt Ltd, erstwhile Cadbury India Ltd, for allegedly evading excise duty by fraudulently taking exemption for one of its ‘ghost’ production units in Himachal Pradesh’s Baddi area.