Mohan Rocky Springwater Pvt Ltd, the manufacturer of popular rum Old Monk, has claimed before the Bombay High Court that the sales restrictions imposed on one of its units in Maharashtra have resulted in losses of over Rs 500 crore to the company and loss of Rs 350 crore to the state excise department.

The company moved the court on Monday seeking relief against the Food Safety and Standards Authority of India (FSSAI) which had prohibited the sale of the liquor due to its formulation and labelling.

The manufacturer also said that despite the restrictions imposed on the Khopoli unit, the same formulation was being sold from other units in Maharashtra.

A Division Bench of the high court comprising Chief Justice Mahesh Chandra Tripathi and Justice Advait Sethna will hear the matter on October 23.

Company Opposes FSSAI, Says It Lost Over Rs 500 Crore

Senior advocate Venkatesh Dhond appearing for the company said the restrictions imposed by FSSAI had resulted in losses of over Rs 500 crore to the company.

He also said that the state excise department has suffered a loss of around Rs 350 crore due to the sale of Old Monk liquor, reports Bar and Bench.

The advocates for the company said that the regulations allow the use of approved additives in neutral spirit and questioned why the company was being targeted when competitors were using similar products.

Additional Solicitor General Anil Singh, appearing for the authorities, said that the sale of the liquor would be allowed if the company amended the label by replacing the word 'rum' with 'rum-like'.

The high court had earlier rejected the company's plea for an interim stay of the prohibition order.

The company, however, agreed to prepare new labels which did not carry any age description and put out a disclaimer that 'added flavor' was used.

But the regulator did not accept the revised labels.

Why FSSAI Took Action Against Old Monk?

The dispute started after an inspection of the Khopoli unit of the company by the FSSAI. The regulator questioned the use of added rum flavor in the spirit.

It also objected to the use of expressions like '7 years old blended' and 'very old vatted' in the label of the bottle since it could mislead the consumers.

The FSSAI said that the use of rum flavor was not permitted except in 'rum-like spirit'.

According to the FSSAI, spirit containing artificial or nature identical rum flavor should be labelled as 'flavored spirit'.

Bombay High Court to Resume Hearing on October 23

The high court will resume hearing of the matter on October 23.

The dispute revolves around the labelling and classification of flavored spirit.

The company's plea questions why other manufacturers are allowed to use added flavor in their liquor while the FSSAI took strong exception against Old Monk.

The court will consider the issue of labelling and classification of liquor during the hearing.