Mumbai: Sugar baron’s distillery licence revoked

The sugar baron, considered close to the current BJP-led government, may even face criminal charges in the matter, confirmed top sources.

Written by Sandeep Ashar | Mumbai | Published:October 23, 2016 3:24 am

Maharashtra’s Excise department has permanently revoked the professional licence of a distillery owned by sugar baron Ratnakar Gutte after it was accused of being involved in an illegal liquor racket.

The sugar baron, considered close to the current BJP-led government, may even face criminal charges in the matter, confirmed top sources. While revoking the distillery’s licence Friday, Excise Commissioner V Radha directed her staff to slap a criminal case against Gutte, along with other directors of the distillery.

Gutte is known to have enjoyed close ties with former Union minister (late) Gopinath Munde. He had even unsuccessfully contested the 2014 Assembly polls from Parbhani’s Gangakhed constituency as the official candidate of the BJP-led alliance. In 2015, Gutte’s flagship company, Sunil Hitech, had courted controversy over water conservation contracts allotted to it in Parbhani by Maharashtra’s Water Conservation department, which was led by Munde’s daughter Pankaja at that time. Last year, the Income Tax department, too, had raided Sunil Hitech’s offices.

The fresh trouble with the Excise department comes at a time when Sunil Hitech’s stocks have surged. Gutte, when contacted, however, said the controversy won’t impact the company’s performance in the stock market.

The controversy

Gangakhed Sugar and Energy Private Limited, a group company of Sunil Hitech, runs a molasses-based distillery in Parbhani with a total capacity of almost 60 kilo litres daily. Gutte is the company’s chairman, while his wife Sudhamati and son Sunil are co-directors.

The Excise department has alleged that the distillery had illegally supplied ethanol or rectified spirit for the manufacture of illicit liquor. In the licence cancellation orders issued Friday, the firm has been accused of unauthorised transportation of intoxicants, unauthorised sale of duty evaded intoxicants, wilful violation of norms, among others.

According to information, the trouble for the firm began after September 6 when the department’s enforcement division intercepted a tanker (MH04 DS 9808) containing 20,000 litres of duty-evaded rectified spirit from Ahmednagar’s Pathardi. The tanker’s driver and cleaner, who were arrested, allegedly told investigators that the consignment, which was allegedly being transported to a notorious alcohol maker operating along the Maharashtra-Madhya Pradesh border, had originated from the distillery. Top sources said about 1 crore litres of alcohol, worth several crores, could be brewed using the supply.

Investigators claimed the driver had confessed that the distillery’s in-charge, identified as Balasaheb Lohar, had contacted him over the phone that day asking him to collect the consignment. The department, which had earlier filed a case against the driver and the cleaner, has obtained call data records for evidence of the conversation which took place between Lohar and the driver. Investigators said the same records also show that the driver was in the distillery’s premises for over an hour that day. They have further obtained CCTV footage from a nearby toll naka, which proves the driver had been to the distillery to collect the consignment.

During further investigations, the department came across 1,071.85 tonne of “unaccounted for molasses” at the distillery. Similarly, 6,232.76 tonne of “unaccounted for molasses” was found at the sugar factory. Rejecting the firm’s claim that the molasses found in excess in the distillery and the sugar mill had been “gained in surplus” during sugar production last year, the department’s cancellation order has charged the firm over an intention to divert this for the “manufacture of illicit alcohol”. On the basis of the orders on Friday, excise officials will now confiscate the distillery’s belongings, including the unutilised molasses, revealed top sources.

Foul play, says firm

Gutte, when contacted, indicated plans to go into appeal against the revocation order. According to the department procedure, the firm can file an appeal before Minister of State (Excise) Vijay Deshmukh.

Denying any links with either the tanker operator or the alcohol maker, Gutte alleged that he was being targeted unfairly. “My distillery already enjoys tax concessions under the mega projects category. Why should I evade the small tax I have to pay then,” he said.

Interestingly, even as Gutte denied that the intercepted tanker had collected the rectified spirit from his distillery, the firm, in its written reply to the department, has agreed that Lohar was employed with the distillery. It has also agreed that the tanker in question had transported duty paid spirit from the distillery. Gutte further argued that he had approached the department last year to regularise the excess molasses gained, but the department had rejected his application on June 14 this year without citing any grounds. “While they (the department) rejected our plea, it did not tell us how to dispose of the surplus molasses,” Gutte argued.

Radha’s cancellation order, however, has rejected this argument. “The surplus molasses found is above 5 per cent of the sugar mill’s production capacity, which cannot be regularised under norms,” the order states. It has also rejected the firm’s contention that the molasses found at the distillery had flowed accidentally from the mill.

Second big catch

Earlier on October 17, the Excise department had revoked the countryliquor licence of Osmanabad-based Vitthal Distilleries Private Limited, which is run by the family of NCP’s sitting MLA Babanrao Shinde, over a two-year-old case related to illegal sale and disposal of 23,227 litres of countryliquor. Vitthal Distilleries has already gone into appeal against the order. Ironically, Vijay Deshmukh, the MoS (Excise), who will hear the matter, represents the same district as Shinde.