An Indian court rejected Pernod Ricard’s plea to sell liquor in New Delhi, deepening its legal and tax troubles in a key market.
NEW DELHI: An Indian court rejected French giant Pernod Ricard’s (PERP.PA), opens new tab plea seeking permission to sell its products in New Delhi on Friday, dealing a blow to the company in a key market where it is battling a host of legal and tax issues.
Pernod and Delhi authorities have been at loggerheads for three years as officials have denied it a licence to sell its products – like Absolut vodka and Chivas Regal whisky – while being an accused in a liquor policy investigation.
The Delhi city authorities have repeatedly rejected its requests, citing an ongoing investigation where the federal financial crime agency accuses Pernod of colluding with some Delhi retailers to boost its market share – allegations the company denies.
Pernod has repeatedly argued that it has not been convicted and so it should be granted a licence, but on Friday the judge said the company was “ineligible” because of the ongoing investigation.
Pernod Ricard did not immediately respond to a Reuters request for comment on the verdict.
Pernod counts India as its biggest market globally by volume and the city of New Delhi typically used to account for about 5% of its countrywide sales before it became unable to sell its products.
The latest licence rejection from city authorities came in February, prompting the company to approach the court saying three years of denials had left its business “hopelessly fettered” in New Delhi, Reuters has reported.
The company is also battling a demand from Indian tax authorities to pay $314 million in back taxes on some of its Scotch imports, Reuters reported this week.
