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| SC verdict paves way for more duty from Seagram |
| BS Reporter / New Delhi Sep 10, 2010, 01:40 IST |
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The finance ministry today said it is going to seek additional Customs revenue from Pernod Ricard India, following a Supreme Court ruling that confirmed the government demand.
In an order passed on July 26, the Supreme Court confirmed the duty demand against Pernod Ricard India, earlier known as Seagram India, in a case of duty evasion of Rs 40 crore on import of concentrates of alcoholic beverages between 1994 and 2000.
“Seagram would thus have to deposit this entire amount now. But this is only the tip of the iceberg. In addition, finalisation of provisional assessments on imports of the goods by Seagram from 2001 is likely to result in significant revenue to the government,” the finance ministry said in a statement.
In the statement, the tax department said there was undervaluation in the import of concentrates of alcoholic beverages (CABs) of Scotch whisky by Seagram India from Joseph E Seagram and Sons Ltd, Scotland, the exporter. Both the companies were wholly-owned subsidiaries of Seagram Company Ltd, Canada.
The concentrates were diluted and bottled for introducing different types of Scotch.
The tax department said the declared prices at which concentrates were imported were suppressed by as much as 50 per cent, compared to the price of similar and comparable Scotch CABs imported by others.
“The importer also blatantly misdeclared quantity of whisky imported for certain consignments, with the intention to evade duty. In fact, the Bills of Entry had white ink marks and overwriting, indicating a deliberate misdeclaration,” the statement from the ministry said.
The original demand was raised following investigation by the Directorate of Revenue Intelligence (DRI) through show-cause notices issued in December 2000 and January 2001. The government had demanded the short paid duty, besides proposing penalty against the company and its executives in India.
Company officials were unavailable for comment.
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