Shimla: The Central Bureau of Investigation (CBI) has booked Cadbury India Limited (now Mondelz Foods Private Limited) in Himachal, for alleged fraud to avail tax benefits. Besides, 12 individuals including two officials of the then Central Excise Department, seven company officials, two consultants and an unknown person have also been booked for criminal conspiracy, cheating, criminal misconduct.
FIR has been registered under section 120B r/w 420 if IPC and 13(2) r/w 13 of Prevention of Corruption Act 1988.
They have been accused of fraudulently availing area-based tax benefits in 2010 for the plant in Baddi.
According to the FIR, an inquiry was conducted by CBI, ACB, Shimla Branch on the allegations that the unit had paid bribes, misinterpreted facts and manipulated records to fraudulently avail area-based exemption benefits (Central Excise and Income tax) in Baddi, despite knowing that they were not entitled to the same.
For availing the same, some members of the executive board of the company along with key managers collectively decided to manipulate records, engage intermediaries to route bribes and cover-up all those evidences that had surfaced during internal investigations, states the FIR.
The Baddi unit had been set up for manufacturing of Malt based food (Bournvita) and had started commercial production from 19 May 2005.
In the year 2007, M/S CIL proposed to expand production by creating a unit for 5 Star and Gems as Unit II on the land acquired land from M/S Barmalt in 2007 in Baddi to avail exemption from excise duty and Income tax for additional 10 years.
M/S CIL decided to expand production capacity in its existing unit instead of setting up a separate unit and avail exemption from 19 May, 2005 that is the date of first commercial production of the existing unit only.
On 22 January, 2007 the company applied for amalgamation of its two units to Director Industries, which granted approval for the merger on 7 March, 2008.
However, the company filed a declaration addressed to the Central Excise Shimla Division, Assistant Commissioner that they would avail excise duty exemption from 29 June, 2009 as their new factory had started commercial production.
The facts revealed that the second unit did not fulfill the prescribed conditions as laid down in the notification dated 10 June, 2003 and thus was not entitled for the availed exemption.
The company official then entered into conspiracy and bribed the officials of Central Excise department to show the second unit was eligible for tax exemptions.
A detailed enquiry by Director General of Central Excise Intelligence, had rejected the claims of the unit and imposed a penalty for wrongful claim of the excise benefits to the tune of approximately Rs 241 crore.