French liquor giant Pernod Ricard suffered a setback on Friday after the Delhi High Court rejected its plea seeking permission to resume sales of its products in the national capital, keeping brands such as Absolut Vodka and Chivas Regal off Delhi shelves for the foreseeable future.
Accusations against Pernod Ricard
The company’s products have remained unavailable in Delhi since 2023, when Pernod Ricard became embroiled in the investigation surrounding the now-scrapped 2021 Delhi liquor policy. The ongoing dispute revolves around whether the company, which has been named as an accused in the case, should be permitted to continue operating in the city.
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Delhi authorities had denied the company’s liquor license application, citing “serious” allegations made by the Directorate of Enforcement (ED). Investigators have accused Pernod of colluding with retailers in 2021 to unlawfully increase its market share in the capital.
At the same time, the company is also facing scrutiny over alleged tax-related violations. According to a Reuters report, Indian investigators concluded that Pernod Ricard concealed the age and composition of its Scotch whisky imports in order to understate their actual value and reduce tariff payments. The allegations triggered a legal battle after the company was asked to pay $314 million (around Rs. 3000 crore) in back taxes.
More fraud and violations done by the company
The documents reviewed by Reuters reportedly showed that investigators concluded in September that Pernod had ‘intentionally complicated’ its disclosures by introducing new internal malt codenames, allegedly making it difficult for customs officials to compare imports with rival companies.
AI Generated Investigators further alleged that Pernod failed to disclose “the true description of their imported malts (i.e., their exact composition and age) with the intention to hide the actual value of the imported goods and to avoid comparison.”
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Authorities have alleged that the company undervalued its bulk Scotch concentrate imports by 67.49 per cent, significantly reducing the 150 per cent tariff imposed in Delhi. These concentrates are used in the production of whisky brands such as Royal Stag.
Pernod India has denied all allegations. In an earlier statement, the company said it “rejects any suggestion of wrongdoing,” adding that it has been fully compliant and is “addressing this matter through the appropriate legal channels and remains confident in its position.”
India remains Pernod Ricard’s largest market globally by volume, with Delhi previously contributing nearly five per cent of its nationwide sales.
