Allied Blenders and Distillers has received a visit from Indian tax officials looking into the import of bulk Scotch into the country.
In a stock-exchange filing yesterday (22 October), the Officer’s Choice brand owner said India’s Directorate of Revenue Intelligence had attended the company’s Mumbai head office and a manufacturing facility in Aurangabad.
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Allied Blenders said the visits, carried out on Wednesday, were linked to “an industry-wide review” into the custom codes applied to bulk Scotch imports.
“If required, the company will continue to provide full cooperation in future,” the business added.
It emerged last week the directorate also visited Diageo’s Indian arm United Spirits and Pernod Ricard’s local office in New Delhi as part of the same investigation.
Sources told Reuters the officials are looking to establish if the companies had incorrectly classified imports, enabling them to pay lower tariffs under the trade agreement between the UK and India.
The trade deal between the two countries came into effect in July. Under the agreement, India’s duties on UK whisky exports have been halved from 150% to 75%. They will be reduced further to 40% over the next decade.
Allied Blenders, which also owns the Iconiq Whisky brand, also yesterday announced the start of operations at a malt distillery in Rangapur in Telangana.
The company said the site was “a key milestone” in expanding its domestic production base and vertically integrating its “core supply chain”. The facility will enable Allied Blenders to manufacture malt spirit in-house, which the business said would “provide a steady, dependable supply of malt spirit as production scales up”.
On Monday, Allied Blenders said a new bottling facility in Moradabad in Uttar Pradesh had also begun operations. The site, which has an annual capacity of six million cases, is located in “one of India’s fastest-growing spirits markets”, Allied Blenders said.
Last month, Indian newspaper The Economic Times reported Suntory Holdings was in “early discussions” over the purchase of a 10-15% stake in Allied Blenders.
Suntory declined to comment on “speculation” when approached by Just Drinks.
