REPUBLIC OF SOUTH AFRICA
-~~=:~-· '£ s
:'\:
IN THE HIGH COURT OF SOUTH AFRICA
GAUTENG DIVISION , PRETORIA
REPORT A BLE: NO ( l )
(2)
(3)
O F INTEREST TO O THER JUDG ES: NO
REVISED.
16/ 01/2026
DATE
In the matter between:
SIGNATURE
CONTRACT PACKING SOLUTIONS CC
and
SOUTH AFRICAN REVENUE SERVICE
MATLAGOLO RAYMOND LEKOANE
HALEWOOD INTERNATIONAL SOUTH AFRICA
(PTY) LTD
ALTERNATIVE POWER (PTY) LTD
DIAGEO SOUTH AFRICA (PTY) LTD
THE MAGISTRATE FOR THE DISTRICT
OF EKURHULENI CENTRAL HELD AT
PALM RIDGE N.O.
CASE NO: 2025-016340
Applicant
First Respondent
Second Respondent
Third Respondent
Fourth Respondent
Fifth Respondent
Sixth Respondent

2


J U D G M E N T

This judgment was handed down electronically by circulation to the parties’
legal representatives by email and uploading it to the electronic file of this
matter on Caselines. The date and time of hand -down is deemed to be 10:00
on 16 January 2026.
TEFFO, J:
Introduction
[1] The applicant seeks relief by way of urgency against the first
respondent for the undisturbed resumption of its business operations of
manufacturing and canning the non -alcoholic energy drinks. The relief sought
is to operate as an interim order with immediate effect pending the finalisation
of a review application to be instituted by the applicant against the first
respondent within 30 days of the granting of this order, to set aside the
warrant, conduct, actions and decisions of the first respondent originating
from the warrant, and the subsequent conduct, actions and decisions of the
officials of the first respondent as set out in the notice of motion.
[2] The applicant also seeks an order granting the reduction of the period
stipulated in section 96(1)(a)(i) of the Customs and Excise Act 1 (“the Act”) in
terms of section 96(1 )(c)(iii) of the Act to enable the matter to be heard on an
urgent basis.
[3] The application is only opposed by the first and second respondents.

1 Customs and Excise Act, 91 of 1964

3
The parties
[4] The applicant is Contract Packing Solutions CC. The first respondent
is the South African Revenue Service (“ SARS”). The second respondent is
Matlagolo Raymond Lekoane, an official of SARS employed as an
Investigator: Customs and Excise Investigations of the Tactical Analysis and
Investigations. The second respondent also holds the designation of Customs
Officer in terms of the Act. He has been cited in this application by virtue of
his citation as the second applicant in the ex parte application under case no.
165/25 issued in the Magistrate Court for the District of Ekurhuleni Central
held at Palm Ridge wherein he deposed to an affidavit for purposes of
securing a warrant for the entry and search of the applicant’s premises, which
warrant forms the subject matter of this application.
[5] The third respondent is Halewood International South Africa (Pty)
Limited (“ Halewood”). The section 86(1) notice erroneously referred to
Halewood as Halewood Breweries South Africa (Pty) Limited. Halewood is
the proprietary holder of the ready to drink (“ RTD”) alcoholic beverages
bottled and packed by the applicant.
[6] The fourth respondent is Alternative Power (Pty) Limited (“ Alternative
Power” or “Switch”). Switch is the proprietary holder of a non-alcoholic energy
drink manufactured, canned and packed by the applicant.
[7] The fifth respondent is Diageo South Africa (Pty) Limited (“ Diageo”).
Diageo is the owner of a blended product referred to as Smirnoff Vodka First
Stage Blend which is at the premises of the applicant.

4
[8] The sixth respondent is the Magistrate who authorised the search and
seizure warrant (“ the warrant ”) and his or her identity could not be
established. I am informed that this application was served on the clerk of
court of the Magistrate’s Court held in Palm Ridge.
[9] The third to the sixth respondents have only been cited in this
application by virtue of the interest they have in the subject matter of the
warrant. No relief is sought against the third to the fifth respondents as they
have been cited by virtue of their relationship as customers of the applicant
and insofar as their rights in and to their property are affected by the warrant
and the conduct and actions of the officials of SARS.
Nature of the applicant’s business
[10] It is alleged that the applicant is a family established, run and owned
business which has been in operation for approximately twenty (20) years.
The business does bottling and packaging of energy drinks and alcohol
products constituting ready to drink (“ RTD”) alcohol beverages. It is 24/7 hour
operation with two shifts operating in its factory at any one time. It employs ±
70 employees comprising factory workers, factory supervisors, a factory
manager, an administrative office worker, a driver responsible for the disposal
of rubbish and members of the close corporation.
[11] The applicant avers that the business is registered in accordance with
the required statutory registrations to operate it and holds a micro
manufacturers’ license issued by the Gauteng Liquor Board in terms of the

5
Gauteng Liquor Board Act 2 (“the Liquor Board Act ”). It is not a distribution
facility or a distribution or selling point of any alcohol products.
[12] Furthermore, the applicant claims that it renders the bottling, canning
and packaging services to limited customers who are the third to the fifth
respondents. It has a contract for the bottling of RTD alcoholic beverages on
behalf of the third respondent (Halewood). Halewood delivers the bulk
product already blended to it, the applicant in turn bottles and packages the
product in a RTD format, whereafter the bottled and packaged product is
collected, sold and distributed by Halewood. The applicant claims not to be
involved in the manufacturing, sale or distribution of the product. This service
to Halewood constitutes less than 2% (two percent) of the applicant’s
business and the applicant is paid a fee for the services rendered.
[13] The applicant asserts that it manufactures, cans, and packages non -
alcoholic energy drinks to the fourth respondent, Alternative Power or Switch.
It does not own the raw materials, the packaging and the like are delivered by
Switch to it. The final product belongs to Switch and it is collected, sold and
distributed by Switch. The manufacturing, canning and packaging of these
energy drinks constitutes approximately 98% of its business.
[14] It contends that currently it does not bottle, can , package or
manufacture any products on behalf of the fifth respondent (“ Diageo”). It is
alleged that the applicant negotiated an agreement with Diageo relating to the
bottling and packaging of a ready to drink alcoholic beverages with alcohol
content of (5%) five percent. To facilitate this, on 17 January 2025, Diageo

2 Gauteng Liquor Board Act 2 of 2000

6
delivered the Smirnoff stage one, vodka blend, being 30 501 litres of (94%)
ninety four percent absolute alcohol (AA) at the applicant’s premises. The
product belongs to Diageo, and it can account for the origin and du ty status of
this alcohol. The applicant did not become, nor does it intend to become the
owner of the product. Due to operational restraints (equipment failures) , the
applicant was not able to start with any process in respect of the envisaged
RTD alcoholic product. It is alleged that this product is easily separated and
distinct from the other operations and products of other customers and has no
bearing on the relief sought or the future energy drink operations of the
applicant.
[15] In terms of a contract it has with Reboost Beverage Company (Pty)
Limited (“Reboost”) it does similar work as it does for Switch , for Reboost of
manufacturing a small portion of the non -alcoholic energy drinks called
“Original”.
[16] The applicant further alleges that its business is mainly conducted at
Unit 7 and partially at Unit 6, Union Street. The warehouse at Unit 6, Union
Street which is a separate premises from the warehouse at Unit 7, Union
Street, is usually used for the storage of empty cans, packing material,
retention stock and in some instances broken or unusable equipment. Unit 6
is not used in the manufacturing, bottling, canning or packaging of any
product.
[17] The manufacturing, canning and packaging of the energy drinks (the
“canning line of the operation ”), is done at Unit 7 as well as the bottling and

7
packaging of the RTD alcoholic drinks using the already blended bulk product
received from the third respondent referred to as the “bottling line”).
[18] The alcoholic products constituting the RTD beverages are
Buffelsfontein and Kola Mix, Belgravia dry lemon and gin mix which are
bottled in 660 ml glass bottles using the bottling line.
Factual background
[19] Pursuant to a search and seizure warrant issued and authorised by the
Magistrate’s Court at Palm Ridge, on 23 January 2025, the officials of the first
respondent entered the premises of the applicant at Unit 7, Union Street,
Alberton North, on 28 January 2025 where they conducted their inspection,
examination, enquiry or search and eventually detained plant machinery and
goods of the applicant in terms of section 88(1)(a) of the Act. In terms of
section 4(12) of the Act, the officials of the first respondent also closed down
and secured the entire business premises of the applicant including Unit 6.
They refused to allow the applicant to continue its business operations.
[20] SARS officials also prohibited the applicant access to its business
premises. They sought the services of Royal Security to guard the premises
of the applicant.
[21] The applicant’s business premises and warehouse remained closed.
On 30 January 2025 SARS officials returned to the applicant’s business
premises and attended to the inventory of the alleged illicit products.
Subsequently, on 31 January 2025, the applicant received a copy of the
inventory from SARS.

8
[22] While on the applicant’s premises on 30 January 2025, the applicant’s
legal representatives pleaded with SARS officials not to continue to shut down
the entire business operation of the applicant but to allow it to operate the
non-alcohol energy drink business. However, that was not permitted and the
entire business operation of the applicant continued to be closed.
[23] Following the detention notice from SARS in terms of which the
applicant was invited to make written submissions to SARS should it wish to
mitigate the possibility of liability for forfeiture with supporting documentation
within seven working days of the date of the notice, the applicant made written
representations and provided supporting documents to SARS as well as
submissions in the form of the DA96 notification which included a notice in
terms of section 96(1) of the Act. The documentation was served on SARS
on 3 February 2025.
[24] In response thereto a meeting was held between the applicant’s legal
representatives and SARS on 5 February 2025 to avoid litigation. On the
same day SARS requested more information from the applicant granting it
until 14 February 2025 to furnish the documentation without indicating when a
decision to continue with the business operations would be made. This
conduct by SARS prompted the applicant to launch this application on an
urgent basis.
Urgency
[25] The issue of whether a matter should be enrolled and heard as an
urgent application is governed by the provisions of Uniform Rule 6(12). The
Rule provides as follows:

9
“Rule 6(12)(a) In urgent applications the Court or judge may dispense
with forms and service provided for in these rules and may dispose of
such matter at such time and place and in such manner and in
accordance with such procedure (which shall as far as practicable be in
terms of these rules) as it seems meet.
(b) In every affidavit or petition filed in support of any application
under paragraph (a) of this subrule, the applicant shall set forth
explicitly the circumstances which he avers render the matter urgent
and the reasons why he claims that he could not be afforded
substantial redress at a hearing in due course.
(c) …”
[26] The applicant who approaches the court on urgency basis must apply
for an order condoning the non -compliance with the rules. He or she must set
forth explicitly the circumstances which render the matter urgent. First and
where necessary, require that the matter be heard outside of the court’s usual
urgent procedures. The applicant must show an absence of substantial
redress if not heard as a matter of urgency.
[27] Whether an applicant will not be able to obtain substantial redress in an
application in due course will be determined by the facts of each case. An
applicant must make out his or her case in that regard. The fact that the
applicant wants the matter to be resolved urgently, does not render the matter
urgent. The correct and crucial test is whether, if the matter was to follow its
normal course as laid down by the rules, an applicant will be afforded
substantial redress. If he cannot be afforded substantial redress at a hearing

10
in due course, then the matter qualifies to be enrolled and heard as an urgent
application. If, however, despite the anxiety of the applicant, he can be
afforded substantial redress in an application in due course, the application
does not qualify to be enrolled and heard as an urgent application3.
[28] The absence of substantial redress that is required by the rules is not
equivalent to the irreparable harm that is required before the granting of an
interim relief. It is something less. The applicant may still obtain redress in an
application in due course, but it may not be substantial4.
[29] The Constitutional Court in Chief Lesapo v North West Agricultural
Bank and Another5, held that the right to approach the court for urgent relief is
inextricably tied to a litigant’s rights under section 34 of the Constitution, an
important purpose of section 34 is to guarantee the protection of judicial
process to persons who have disputes that can be resolved by law.
[30] As far as urgency is concerned, the applicant relied on a legal
argument, and a number of arguments pertaining to facts which have been
disputed by the first respondent in its answering affidavit and upon, which in
these proceedings, one is unable to make a finding.
[31] Basically, the applicant contends that the conduct of SARS in closing
down its entire business operation is ultra vires , unlawful, unreasonable,
unconstitutional and irrational. It asserts that SARS has abused the warrant
and powers in terms of the CEA to close down its business operation. It

3 East Rock Trading 7 (Pty) Ltd and Another v Eagle Valley Granite (Pty) Ltd and Others
[2012] JOL 28244 (GSJ) at [7] and [9]. See also Commissioner, South African Revenue
Services v Hawker Air Services (Pty) Ltd; Commissioner, South African Revenue Services v
Hawker Aviation Partnership and Others 2006 (4) SA 292 (SCA) at [9]
4 East Rock Trading (Pty) Ltd and Another v Eagle Valey Granite (Pty) Ltd and Others at [7]
5 2000 (1) SA 409 (CC) at para [13]

11
claims that at the time its business operation was forced to close down, a
mixture of the energy drinks was in the process of being prepared in the
preparation tank. The preparation and process is time sensitive and
consequent to the closure of the business operation, the prepared mixture of
the energy drink has become unusable. Each day the production of the
energy drinks is halted, results in the loss of approximately R3 504 592,00
(Three million five hundred and four thousand five hundred and ninety two
rand) per week of income which runs into millions of rands per month. All the
factory employees have been placed on indefinite unpaid leave and are not
receiving any remuneration for as long as the energy operations remained
closed.
[32] The applicant further contends that it is fast approaching commercial
insolvency with irreversible and far -reaching consequences all of which can
be prevented if the urgent relief is granted. Moreover, apart from the dire
consequences for the employees, a substantial economic loss will be suffered
as the applicant will not be able to pay or meet its tax obligations.
[33] Furthermore, the applicant contends that prior to obtaining the warrant
and closing its business operations, and since February 2024 SARS had
knowledge of the nature of and extensive information concerning its business.
Post closure of the business, SARS is calling for the same information. SARS
had and used other means to obtain information and investigate the activities
of the applicant and could do so with due compliance with the enshrined
principle of giving a citizen an opportunity to heard prior to any detrimental
actions taken against it. If SARS had fears of contraventions of the CEA, it

12
should have acted pursuant to its earlier investigations of February 2024 and
not wait until January 2025 to act as it has done.
[34] SARS disputes the allegations and contends that the application is not
urgent.
[35] The urgency of commercial interests may justify the invocation of
Uniform Rule 6(12) no less than any other interests. Each case must depend
upon its own circumstances6.
[36] Where allegations are made relating to abuse of power by a Minister o r
other public officials which may impact upon the rule of law, and may have a
detrimental impact upon the public purse, the relevant relief sought ought
normally to be urgently considered.
[37] Based on the above I am persuaded on the papers that there is
justification for the application to be heard on urgent basis.
Section 96(1) of the Act
[38] Section 96 of the Act provides as follows:
“(1)(a)(i) No process by which any legal proceedings are instituted
against the state, the Minister, the Commissioner or an officer for
anything done in pursuance of this Act may be served before the expiry
of one month after delivery of a notice in writing setting forth clearly and
explicitly the cause of action, the name and place of abode of the
person who is to institute such proceedings (in this section referred to

6 Twentieth Century Fox Film Corporation and Another v Anthony Black Films (Pty) Ltd 1982
(3) SA 582 (W) at 586G

13
as the ‘litigant’) and the name and address of his or her attorney or
agent, if any.
…
…
(iii) No such notice shall be valid unless it complies with the
requirements prescribed in this section …
(c)(i) The State, the Minister, the Commissioner or an officer may on
good cause shown reduce the period specified in paragraph (a) …
(ii) If the State, the Minister, the Commissioner or an officer , refuses to
reduce or extend any period as contemplated in subparagraph (i), a
High Court having jurisdiction may, upon application of the litigant,
reduce or extend any such period where the interest of justice so
requires.”
[39] The applicant served SARS with the section 96(1) notice on 3 February
2025 and subsequently on 6 February 2025, it launched this application. It
alleges that it requested SARS to reduce or extend the period envisaged in
section 96(1) (a)(i) of the Act. However, SARS refused to reduce or extend
the period referred to in section 96(1) resulting in the applicant requesting this
Court to condone non -compliance thereof by either reducing or extending the
period envisaged in section 96(1)(a)(i) of the Act.
[40] The court can only condone that period where the interest of justice so
requires. Mr Peter SC for the respondents submitted that it will not be in the

14
interest of justice to reduce the period stipulated in section 96(1) of the Act as
the applicant is seeking the urgent interim relief without challenging the
detention of the goods by the officials of SARS. Further that SARS received
the section 96(1) notice on 3 February 2025 and the application was served
upon it on 6 February 2025 after it had requested additional information from
the applicant on 5 February 2025. He claimed that SARS has a valid
detention which entitles it to conduct its investigations. It must be given a
reasonable opportunity to conduct its investigations. It was only given 3 days
instead of one month to conduct its investigations.
[41] Relying on the judgment of Henbase 3392 (Pty) Ltd v Commissioner,
South African Revenue Service and Another 7, Mr Peter SC argued the rules
of natural justice do not apply to a detention. The purpose of a detention is to
assert control and security of the goods pending investigation and until the
applicant has been given an opportunity to satisfy it that it has not
contravened the Act and the goods are not liable for forfeiture.
[42] Mr Peter further submitted that while SARS is investigating, it should
be entitled to retain physical control of the applicant’s goods and assets. On
the other hand Mr Barnard SC for the applicant submitted in the section
96(1)(a)(i) notice, the applicant indicated its intention to bring an application to
set aside the warrant, the detention and the actions of the officials of SARS at
a later stage and that in the interim it seeks urgent relief to operate its energy
drink business as it contends that its detention and closure was unlawful,
subject to secure SARS’ rights and interest to do the investigation.

7 2002 (2) SA 180 (T)

15
[43] He further submitted that in the section 96(1) (a)(i) notice, proposals
were made as to how to deal with the matter pending the finalisation of the
investigation process by SARS. He argued that there is no statutory provision
that says detention is only valid for a certain time or that the investigation
must be completed within a certain time frame. He referred to similar matters
where investigations took more than a year and argued that the alcohol
business can remain detained and be separated from the non -alcohol
business which comprises the energy drinks and which the applicant
contends is a legitimate business which was unlawfully detained.
[44] Mr Barnard SC further submitted that SARS had sufficient notice and
ample opportunity to address the issues before court and could have avoided
this application. He urged the court to order the truncation of the period
stipulated in section 96(1)(a)(i) of the Act and allow the application to be heard
by way of urgency.
[45] The court in Commissioner for the South African Revenue Service and
Others v Dragon Freight (Pty) Ltd and Others 8 had this to say regarding the
purpose of section 96(1)(a)(i) of the Act:
“[33] The purpose of section 96(1) is self -evident: to allow SARS, the
organ of state charged with the administration of the Act, to investigate
or review the merits of the intended legal proceedings and decide what
position to adopt in relation thereto. It may, for example, in an
appropriate case decide to resolve the dispute before the institution of

8 [2022] 3 All SA 311 (SCA)

16
legal proceedings, to avoid unnecessary and costly litigation at public
expense.
[34] SARS is a large and complex institution with extensive
administrative responsibilities and high workloads. Its functions are not
confined to the levying of customs and excise duties under the Act but
include the recovery of taxes under the Income Tax Act 58 of 1962 and
the administration of the Value -Added Tax Act 89 of 1991. The section
96(1) notice enables SARS to ensure that a matter is brought timeously
to the attention of the appropriate official for investigation or review. In
my opinion, section 96(1)(a) of the Act promotes the efficient and
economic use of resources, in accordance with the basic values and
principles governing public administration set out in section 195 of the
Constitution of the Republic of South Africa, 1996 (‘the Constitution’).”
[46] My understanding of the purpose of section 96(1) of the Act as outlined
above is that the section is peremptory and the applicant who intend s
abridging the period stipulated ther ein must furnish reasons why the period
should be truncated. The applicant in this application has also sought the
relief for the truncation of the period provided for in section 96( 1) and
furnished reasons the reof which in my view coincide with the reasons for
bringing the application in the urgent court. Having rule d that the matter is
urgent, I find that it is in the interest of justice to reduce the period stipulated in
section 96(1) and hear this application on urgent basis

17
The interim interdict and applicable law
[47] The requirements for the granting of an interim interdict are trite. The
applicant is required to establish: a prima facie right, a well -grounded
apprehension of irreparable harm if the interim relief is not granted and the
ultimate relief is eventually granted, that the balance of convenience favours
the granting of an interim relief, and that the applicant has no other
satisfactory remedy9. Holmes JA10 had this to say:
“The granting of an interim relief pending an action is an extraordinary
remedy within the discretion of the court. Where the right which it is
sought to protect is not clear, the court’s approach in the matter of an
interim interdict was lucidly laid down by INNES, J.A., in Setlogelo v
Setlogelo, 1914 AD 2221 at p. 227. In general, the requisites are:
(a) a right which, ‘though prima facie established, is open to some
doubt’;
(b) a well-grounded apprehension of irreparable injury.
(c) the absence of ordinary remedy.
In exercising its discretion, the court weighs, inter alia, the prejudice to
the applicant, if the interdict is withheld, against the prejudice to the
respondent if it is granted. This is sometimes called the balance of
convenience.

9 Eriksen Motors (Welkom) Ltd v Protea Motors Warrenton and A nother 1973 (3) SA 685 (A);
see also LF Boschoff Investments (Pty) Ltd v Cape Town Municipality, Cape Town
Municipality v LF Boschoff Investments (Pty) Ltd 1969 (2) SA 356 (C) at 267B-E
10 Eriksen Motors supra at 691

18
The foregoing considerations are not individually decisive, but are
interrelated: for example, the stronger the applicant’s prospects of
success, the less his need to rely on prejudice to himself. Conversely,
the more the element of ‘some doubt’, the greater the need for the
other factors to favour him. The court considers the affidavits as a
whole, and the interrelation of the foregoing considerations, according
to the facts and probabilities; see Olympic Passenger Service (Pty) Ltd
v Ramlagan 1957 (2) SA 382 (D) at p. 383D -G. Viewed in that light,
the reference to a right which, ‘though prima facie established, is open
to some doubt’ is apt, flexible and practical, and needs no further
elaboration.”
[48] Where the right is clear “ … the remaining questions are whether the
applicant has also shown:
(a) an infringement of his right by the respondent; or a well -grounded
apprehension of such an infringement.
(b) the absence of any other satisfactory remedy.
(c) that the balance of convenience favours the granting of an
interlocutory interdict11.”
[49] In considering the harm involved in the grant or refusal of a temporary
interdict, where a clear right to relief is not shown, the court acts on the
balance of convenience. If though there is prejudice to the respondent, and

11 Knox D’Arcy Ltd and Others v Jamieson and Others 1995 (2) SA 519 (W) at 592-593

19
that prejudice is less than that of the applicant, the interdict will be granted,
subject if possible, to conditions, which will protect the respondent12.
Clear right/prima facie right
[50] The applicant contends that it cannot have its entire business operation
closed. It claims that the closure of its canning operation which relates to the
canning and packing of the non -alcoholic energy drink it does on behalf of
Switch is prima facie unlawful. The canning operation according to it falls
outside the scope and ambit of the Act and SARS’ investigation.
Furthermore, the warrant and SARS’ conduct were only aimed at the alcohol
products which relate to its bottling operation.
[51] It asserts that the canning operation and the relief sought have no
effect on SARS’ detention of the canning plant and equipment. The detention
in respect thereof remains in place and the validity and lawfulness of that
detention will be addressed later in the main application. It contends that it
only seeks relief to use the canning plant and equipment, pending the
finalisation of SARS’ investigation and/or adjudication by a court in due course
of the validity and lawfulness of the detention.
[52] The applicant contends that the interim relief sought pending the
institution of the main application, will not in any way or manner hamper or
restrict SARS’ investigations and it is able to separate and secure the bottling
operations and alcohol products from the energy drinks canning operations.

12 Webster v Mitchell 1948 (1) SA 1186 at 1189

20
[53] The applicant avers that it has furnished SARS with laboratory tests
that confirm that the finished energy drinks, manufactured with the recipe for
the product have a sugar content below the threshold and therefore confirm
that the energy drinks were never subject to the SBL and the future energy
drinks will also not fall within the ambit of SBL.
[54] In its heads of argument it was submitted on behalf of the applicant that
the question as to whether the applicant as opposed to Switch should be
registered as a sugary beverage manufacturer and if such registration is
required, is academic because the energy drinks do not fall within Part 7A or
any of the products in item 191 of Part 7 of Schedule 1 to the CEA.
[55] SARS contends that the applicant has contravened various provisions
of the CEA in that it has engaged in activities which may be conducted at a
licensed customs and excise manufacturing warehouse. The activities
according to SARS include the mixing and blending of the alcohol spirits as
well as the manufacture of sugary beverages subject to the Health Promotion
Levy (“HPL”).
[56] SARS claims that it obtained the warrant based on the information it
had acquired concerning a large delivery of highly concentrated alcohol which
the applicant confirms receipt of (a delivery of more than 94% of absolute
alcohol (“AA”)).
[57] SARS denies that the alcohol received in that form is ready to drink. It
contends that the applicant confirms the existence of an agreement to bottle
and package the ready to drink alcohol with an alcohol content of 5%. It avers
that the applicant received a delivery of 30,501 litres of 94,96% AA which

21
when blended and diluted would yield more than 575,000 litres at 5% AA.
The alcohol blending plant and equipment was being serviced on the day of
the visit by the officials of SARS.
[58] SARS claims that when its officials were on the premises, they
observed pallets of empty 300 ml bottles of Smirnoff consisting of about 2226
unites per pallet with 209 pallets in the bottles as recorded in the detention
inventory. There were also boxes of labels that were to be affixed to the
bottles and plastic shrink wrap packaging for both Smirnoff and Smirnoff spin.
[59] According to SARS the blended 575,000 litres at 5% AA would fill more
than 1,9 million 300 ml bottles of ready to drink alcohol. There were also 88
pallets of 660 ml empty bottles that were detained. SARS contends that all
these activities are required to take place in a licensed customs and excise
manufacturing warehouse. The applicant’s premises are not licensed at all.
[60] The second respondent, Mr Lekoane alleges in the answering affidavit
that while at the premises of the applicant with the other officials of SARS,
they also observed large storage, mixing and blending tanks and 62 bags of 1
ton Hullet sugar. It appeared that a different product in the form of refined
sugar is used in the production of the liquor as part of the blending.
[61] SARS denies that the applicant only bottles ready to drink alcohol as it
claims.
[62] Regarding the sugar beverages and HPL , SARS contends that the
sugar threshold for the HPL is 4 g per 100 ml or 40 g per litre. It referred to
annexure FA11 attached to the founding affidavit of the applicant and

22
submitted that it indicates that one of the Switch products exceeds the sugar
threshold. This annexure came as a result of a test that was done by the
applicant’s employees at the premises on its own Anton Paarl instrument. The
results of the test performed revealed that the mass concentration of sugar
was 48,1 g per litre. This, according to SARS is evident that the applicant
conducts activities that are required to take place in licensed warehouse
premises.
[63] Mr Peter for SARS argued that based on the activities that were found
to be conducted at the applicant’s premises, the applicant ’s premises should
have been licensed, and the applicant should have been registered as a
manufacturer of sugar beverages as well as for alcohol. He disagreed with Mr
Barnard for the applicant that the Act does not apply if the sugar content is
less than 4 grams per 100 ml. He referred to Rule 54(1) and submitted that if
a person is manufacturing tax free drinks using more than 500 kilos of sugar
per year, he must register and if he is using less, he must apply for an
exemption.
[64] Mr Peter referred the court to three emails attached to the replying
affidavit of the applicant, all dated 1 March 2024 which I will deal with later
and argued that the applicant blends alcohol. It gets a concentrate and mixes
it. The alcohol it received is not ready to drink and for the mixing and
blending, the applicant must have a VMS (the manufacturing licence for the
premises). Furthermore, he submitted, the applicant uses sugar both for
alcohol and sugary drinks. The applicant is blending in alcohol and using the
same equipment in the alcohol production as it is using in the sugary

23
beverage production. Although not disputed in the papers, Mr Peter submitted
the two cannot be distinguished to say the court should not look at this alcohol
side of the business and only concentrate on the sugary beverage side.
[65] He submitted that regarding the relief sought, the applicant wants to
use the same equipment it has been using for the alcohol production for the
sugar beverage production. Further that SARS is entitled to detain the entire
business operation as it did under section 88 of the Act. The applicant was
served with a detention notice which it wants the court to ignore. It is not
challenging the detention. However, it wants to resume its sugar production.
Moreover, SARS is entitled to lock up the premises if it has reason to believe
that unlawful activities are taking place. In this regard, he relied on the
provisions of section 4(12) of the Act.
[66] After referring to sections 27, 54I, Rule 54I.02 and Part 2 of Schedule
1, Mr Peter submitted that all laws applicable to the importation, payment of
duty, manufacture and entry for home consumption, including, manufacture
that apply to excisable goods apply mutatis mutandis to health promotion levy
(HPL) goods. He argued that even though the health promotion levies do not
fall within the definition of excisable goods and section 27 says you cannot
manufacture excisable goods unless you register in a warehouse, section 54I
says if it is a health promotion levy, it is excisable mutatis mutandis, and that
is the reason why SARS maintains that the applicant needs a warehouse.
[67] Mr Peter further submitted that the applicant did not challenge the
detention as being unlawful, it does not have a prima facie right to obtain the
relief sought. It cannot operate its business as it has been stopped from

24
operating in terms of a valid warrant. Their rights are subject to the statutory
powers of detention.
[68] The applicant concedes in its papers that alcohol is an excisable
product. It does not challenge its detention and investigation by SARS.
However, it maintains that the closure of its energy drink operation which
comprises 98% of its business is prima facie unlawful and it is a serious
violation of its constitutional right. It contends that it has a clear right to protect
its constitutional right.
[69] Regarding the submission made about annexure FA11 that indicates
that the sugar content on the energy drinks was above threshold, Mr Barnard
submitted that the annexure was mistakenly added to the founding papers
and that the results thereof are not from a laboratory as required by the Act.
He argued that the document is inadmissible because it is not what the statute
determines how the sugar content should be calculated. He submitted that the
intention was to attach a document attached to the Replying Affidavit (RA3)
which is a report that complies with the Act that says the sugar content was
below the threshold (being 3.78). He also referred to two more certificates
which all indicate that the sugar content on the energy drinks was below the
threshold.
[70] Mr Barnard referred to item 191.00 in section A of Part 7 of Schedule
No. 1 and argued that the Switch product does not fall within the ambit of item
191. It is therefore not a sugary beverage as contemplated in Rule
54(I).01(c)(vii). He disagreed with Mr Peter’s submission and argued that if
the legislature wanted to include all sugary beverage, it should have said so.

25
[71] Rule 54(I).01(c)(ii) provides that “ sugary beverage means a beverage
manufactured or imported in the Republic in terms of item 191 of section A of
Part 7 of Schedule 1”.
Mr Barnard submitted the rule is limited to that specific type of sugary
beverages. He further argued that in terms of the definition of sugar beverage,
it will only be a sugar beverage content of above 4 grams per 100 millilitres.
Furthermore, he submitted that the applicant does not manufacture such a
sugary beverage, it does not have to register nor have a license. That is why
the legislature requires a laboratory test report to measure the sugar content
on the product or assume that it is 20 grams per 100 millilitres. Mr Barnard
went on to say that because the applicant says there is a prima facie
indication that the energy drinks are not subject to the sugar beverage levy,
the detention and continued detention, and the prohibition for it to operate its
business should be protected on an urgent basis. The detention can remain
in place even on the equipment used for the sugar beverages, until such time
as the whole process has been finalised. However, in the interim it will bring a
substantive application that will deal with all the issues.
[72] At paragraph 16.31.9 of the founding affidavit the applicant states that
in confirmation of the sugar content of the Switch energy drink is attached as
“FA11” a copy of the test report from SANAS/ILAC as required in terms of
Note 5(a) of the notes to section A of Part 7A of Schedule 1 to the CEA,
confirming that the product is not a sugary beverage as contemplated in item
191.

26
[73] It is correct that what is on FA11 does not support the allegations made
by the applicant. I do not understand the reasons behind the fact that FA11
was attached to the papers by mistake, it is not admissible as it is not a report
from the laboratory as required by law and that it has now been corrected in
the replying affidavit. As at the time of the entry to the premises for the
search and detention those were the results that were furnished to SARS
officials and the tests according to Mr Lekoane were done in their presence.
SARS in my view cannot be faulted for acting on the basis of that information
at the time. Furthermore, according to what is stated in the founding affidavit ,
annexure FA11 is a copy of the report from SANAS /ILAC which is a
requirement in terms of the Act
[74] Three emails dated 1 March 2024 have been attached to the replying
affidavit on pages 02-226 – 02-228. These emails are addressed to the three
different customers of the applicant from the applicant. The first one on page
226 is addressed to Halewood from Ms Lynn-Smith. It states the following:
“Herewith is the process for Halewood Breweries.
1. Contract Packing will receive an order to manufacture.
2. Halewood will send us tankers of 20.000 litres of Ready Mix Syrup
which we will just add water at a dilution ratio of 1+3. …”
[75] The second email is addressed to Alternate Power/ Switch and relates
to the process of manufacturing the Switch energy drinks. It states:
“1. The Alternate Power Company will send us a forecast for a
month at a time as per the attached sample.

27
2. All the raw materials and packaging will get delivered to us.
3. Contract Packing will then blend the raw materials as per the
flavour receipt supplied by Alternate Power Company (Attached
Blending Sheet).
…
[76] The third letter is addressed to Brown Forman Netherlands and states
the following:
“1. …
2. Brown Forman USA will send a tanker of Whiskey which is duty
paid on entry at the port.
3. Contract Packing will call off from the Brown Forman Suppliers
for Glass, Bottle Tops, Bottle Labels, 4 pack wraps and Trays
and flavours.
4. Contract Packing will purchase the sugar for the production.
5. Contract packing will then blend according to the Jack Daniels
formulation …”
[77] A read ing of these e -mails is a clear indication of the mixing and
blending of the alcohol and the sugary beverages. It is not for me to give a
finding regarding this and the disputes relating to the sugary beverages
content or measurements that are in the energy drinks but there is in my view
prima facie evidence for SARS to believe that unlawful activities have been

28
taking place at the applicant’s premises although the allegations are disputed.
SARS contends that the applicant uses sugar for both alcohol and sugary
drinks and the allegations are denied by the applicant. It cannot be said that
the applicant has established a clear right in relation to the business of the
energy drinks.
[78] Can it be said that the applicant has established a prima facie right for
the relief it is seeking?
[79] In an application for a temporary interdict, the applicant’s right need not
be shown by a balance of probabilities; it is sufficient if such right is prima
facie established, though open to some doubt. The proper manner is to take
the facts as set out by the applicant together with any facts set out by the
respondent which the applicant cannot dispute and to ask whether, having
regard to the inherent probabilities, the applicant could on these facts obtain
final relief at a trial. The facts set up in contradiction by the respondent should
then be considered, and if serious doubt is thrown upon the case of the
applicant, he could not succeed13.
[80] Mr Barnard submitted that there is prima facie indication that the
energy drinks are not subject to the sugar beverage levy, the detention and
continued detention and the prohibition for the applicant to operate its
business should be protected on an urgent basis.

13 Webster v Mitchell 1948 (1) SA 1186 (W) at 1189, Manong & Associates (Pty) Ltd v
Minister of Public Works and Another 2010 (2) SA 167 (SCA) at 180

29
[81] The Constitutional Court in National Gambling Board v Premier,
KwaZulu Natal and Others14 defined an interim relief as follows:
“An interim interdict is by definition ‘a court order preserving or
restoring the status quo pending the final determination of the rights of
the parties. It does not involve a final determination of these rights and
does not affect their final determination.”
[82] The court further had this to say15:
“The dispute in an application for an interim interdict is therefor not the
same as that in the main application to which the interim interdict
relates. In an application for an interim interdict the dispute is whether,
applying the relevant legal requirements the status quo should be
preserved or restored pending the decision of the main dispute. At
common law, a court’s jurisdiction to entertain an application for an
interim interdict depends on whether it has jurisdiction to preserve or
restore the status quo. It does not depend on whether it has the
jurisdiction to decide the main dispute.”
[83] Having considered the facts in this matter I find merit in SARS
argument that the applicant does not have a prima facie right to resume its
energy drinks operation in that that right has now being affected by the
detention by SARS which has not been challenged in these proceedings.
A well-grounded apprehension of irreparable harm and the balance of
convenience

14 2002 (2) SA 715 (CC) at para [49]
15 National Gambling Board v Premier, KwaZulu Natal and Others, supra at [49]

30
[84] The second requirement which the applicant must satisfy is to show
that there is a reasonable apprehension of irreparable harm and imminent
harm eventuating should the order not be granted. The harm must be
anticipated or ongoing. It must not have taken place already16.
[85] The applicant contends that the closure of its business is seriously
detrimental to it, its employees and clients. If it continues, it is fast
approaching commercial insolvency, approximately 70 employees will lose
their livelihoods, and p reventable irreparable harm and damages to
machinery, equipment, products and business, running to millions of rand, will
be suffered and the effect is accumulating every day. It claims that the
potential prejudice to SARS, the fiscus and the general economy, if the interim
relief is granted, is minimum to the point of being non -existent. Further that
the balance of convenience substantially favours the granting of the interim
relief.
[86] It was submitted on behalf of SARS that the detention grants it rights to
detain the goods, equipments and the machinery and also keep them out of
the premises. SARS is currently busy with its investigations. It will not be able
to conduct its investigations and also perform some tests on the goods
detained if the applicant is allowed to resume its operations and suddenly the
product it has detained disappears. Mr Peter submitted that the rules of
natural justice are not applicable to the detention because the detention aims
to assert control and security of the materials until the applicant has been
given an opportunity to show why the goods are not liable for forfeiture.

16 See Tshwane v City Afriforum 2016 (6) SA 279 (CC) at 360B-C

31
[87] It was further submitted that although the interim interdict is
couched in form, the application is in substance a final interdict to set
aside a detention effected in terms of section 88 of the Act and
thereby frustrate the Commissioner in his efforts to establish whether
the detained goods are liable for forfeiture under the Act, and put the
applicant back into the position to continue unlawful manufacturing
activities in its premises contrary to the provisions of the Act.
[88] In weighing these two scenarios, one must avoid a rigid belief that the
State is more powerful than individuals or juristic persons such as companies
and that for example financial prejudice to the State is less serious than
financial prejudice to so -called private entities, because the State’s money
does not belong to anybody in particular and its resources are almost
unlimited. The State has a duty to the public as a whole and to all individuals
to collect taxes diligently, not only to meet its responsibilities in terms of the
enormous need for resources inside South Africa, but also in order to be fair
to those individuals and juristic persons who do pay their taxes (in the wide
sense of the word) in a law abiding and diligent manner17.
[89] There is no doubt that the applicant is suffering and will suffer if the
interim interdict is not granted. However, in my view the prejudice or harm
that SARS will suffer if the interim interdict is granted far outweighs the
irreparable harm that the applicant will suffer if the interim interdict is not
granted. I therefore do not agree with the applicant that SARS will not suffer
any irreparable harm should the interdict interim be granted. The balance of
convenience does not therefore favour the granting of the interim interdict.

17 Henbase supra

32
Alternative remedy
[90] The applicant contends that its rights to claim damages remain
reserved. Further that it is entitled to claim compensation for losses or
damages arising out of the actions of any officer of SARS which are not bona
fide. I am persuaded that the applicant has an alternative remedy to claim
damages or any loss as a result of the actions of SARS officials should there
be any.
[91] In conclusion I find that t he applicant has failed to satisfy the
requirements for the granting of the interim relief.
Costs
[92] Mr Peter requested costs for two counsel on Scale C. Having
considered the matter, I grant costs for the employment of two counsel, one
on Scale C and one on Scale B.
[93] Consequently, I order that this application is dismissed with costs
which include the costs for the employment of two counsel, one on Scale C
and one on Scale B.
M J TEFFO
JUDGE OF THE HIGH COURT
GAUTENG DIVISION , PRETORIA

33


Appearances
For the applicant J M Barnard

Instructed by Wright Rose-Innes Inc
c/o Macintosh Cross & Farquarson

For the first and second
respondents J R Peter

Instructed by MacRobert Attorneys