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The HC ruling comes at a difficult time for the French liquor firm, which is also battling a tax dispute involving a demand of nearly Rs 3,000 crore.
The ruling means the company’s brands, including Absolut Vodka and Chivas Regal, are unlikely to return to liquor store shelves in Delhi anytime soon.
Lovers of Absolut Vodka and Chivas Regal in New Delhi may have to wait longer to buy their preferred liquor brands as the Delhi High Court on Friday rejected a petition by French liquor giant Pernod Ricard seeking permission to sell its products in the national capital.
The company was banned from operating in Delhi from 2023 due to its involvement in the matter concerning the 2021 Delhi Liquor Policy issue.
The dispute centres on whether a company named as an accused in the case can continue to receive a licence to sell liquor in the city. Delhi authorities have repeatedly denied Pernod Ricard a licence, citing allegations by the Enforcement Directorate (ED) that the company colluded with retailers to illegally increase its market share.
The High Court on Friday held that Pernod Ricard was “ineligible” for a liquor licence because of the continuing investigation against it which means the company’s brands, including Absolut Vodka and Chivas Regal, are unlikely to return to liquor store shelves in Delhi anytime soon.
The setback comes at a difficult time for the French liquor firm, which is also battling a tax dispute involving a demand of nearly Rs 3,000 crore, reported news agency Reuters.
As per the news agency, investigators accused Pernod of hiding the age and composition of its Scotch whisky imports to reduce tariff payments.
Authorities have reportedly asked the company to pay nearly $314 million, or around Rs 3,000 crore, in back taxes. With penalties, the total liability could reportedly cross Rs 5,700 crore if the company loses the case.
India is Pernod Ricard’s largest market globally by volume, and before sales were halted, Delhi accounted for roughly 5% of the company’s nationwide sales.
The company argued that it was denied access to crucial pricing data used during the investigation.
Although Reuters had reported the initial warning over the tax demand in 2022, hundreds of newly reviewed documents – including investigation reports and submissions filed in the Delhi high court in recent months – reveal previously unreported details of the dispute.
According to the documents, the probe in India concluded in September that Pernod “intentionally complicated” its disclosures by introducing new internal malt codenames, allegedly making it harder for customs officials to compare its imports with those of competitors.
Investigators also said that Pernod failed to declare “the true description of their imported malts (i.e. its exact composition and age) with the intention to hide the actual value of the imported goods and to avoid comparison,” according to an investigators’ report included in a government filing.
Delhi, India, India
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