Old Monk sale ban in Maharashtra costs state about Rs 350 crore in revenue

The ban on sales of Old Monk rum in Maharashtra is hurting not only drinkers and the company but also the state government's earnings. The brand is hugely popular among rum lovers, and there is visible resentment among them over the stoppage of sales.

Mohan Rockey Springwater Private Limited has filed a petition in the Bombay High Court in the matter. The company says the ban has caused it a loss of more than Rs 500 crore. According to available information, the state government's excise department has also suffered a revenue loss of about Rs 350 crore.

The dispute concerns the flavouring used in Old Monk rum and the information printed on the bottle's label. The Food Safety and Standards Authority of India (FSSAI) had objected to the sale of certain liquor products. The regulator says that if rum flavouring has been added to a liquor, the label must carry accurate information about the product. According to FSSAI, customers could be misled if such products are sold as ordinary rum. For this reason, sales from the company's Maharashtra unit were halted.

The company told the court that the halt in sales from its production unit in Thane district of Maharashtra has caused it heavy financial loss. It also says that while this unit is under the ban, other units in the state are selling rum made to the same formula. The company has challenged the action and sought relief from the court. It claims that under the rules governing the ingredients and processes used in making the product, it should be given an opportunity to present its side.

During the hearing, the counsel appearing for the Central government said that if the company agreed to write "rum-like product" instead of "rum" on its label, permission for sales could be considered. The company had earlier proposed a change in the label, but the revised label was not approved. As a result, the dispute remains unresolved.

The Bombay High Court has not granted the company any immediate interim relief for now. The next hearing in the case will be on October 23. All eyes are now on the further court proceedings and the resolution of the label dispute. The final decision in the matter is yet to come.