Chocolate giant Cadbury Plc could be slapped with criminal proceedings for evading excise duty, an excise department official familiar with the developments said.

The Directorate General of Excise & Customs Intelligence recently issued a show-cause notice against Cadbury, accusing the company of using a nonexistent factory to avoid taxes to the tune of Rs 252 crore.

Requesting anonymity, the excise department official said, "The option of launching criminal proceedings is open to the department. We will wait for the final order before taking a decision."

The Tax department has accused Cadbury of evading excise duty by falsely claiming a tax holiday meant only for those factories that started production before March 2010 in Himachal Pradesh.

According to the tax department, Cadbury availed the tax break by falsifying and backdated papers to show that its factory had started production in March 2010. The tax authorities argued that the company's factory could have started production in 2010 because it had not received permission for starting production until January 2011.

The chocolate company is also being accused of passing off products produced in another factory in Baddi as goods made in its own factory that had not yet started production.

A spokesperson for Cadbury, which is owned by Mondelez International Inc, has already confirmed that it had received a show-cause notice from Indian tax authorities. The spokesperson added that the company was reviewing the contents of the notice and would respond to it after consulting the matter with its legal advisors.