United Spirits moves Bombay HC over FSSAI flavouring order

New Delhi: United Spirits Ltd, maker of McDowell's No.1, Royal Challenge, Antiquity Blue and Signature whisky, has moved the Bombay High Court against an order by the Food Safety and Standards Authority of India (FSSAI) restricting the sale of one of its rum products.

The move comes as FSSAI steps up enforcement against what it says is the misleading use of identical flavouring and age-related claims in alcoholic beverages, a move that could reshape long-standing manufacturing practices across India's Indian Made Foreign Liquor (IMFL) industry.

In a stock exchange filing on Monday, the Diageo India-owned company said it had filed a writ petition challenging FSSAI's 29 June order concerning a product manufactured at its Baramati unit in Maharashtra. The regulator alleged the product labels violated provisions of the Food Safety and Standards Act, 2006.

United Spirits said its labels comply with the current legal and regulatory framework and reflect long-standing industry practice. The petition was filed on 1 August.

The company said the order has no material operational or financial implications and declined further comment, saying the matter is sub judice.

Under scrutiny

The disclosure came a day after FSSAI, in an official release, defended its enforcement action against several alcoholic beverage manufacturers.

The regulator said the issue is not flavouring substances such as coffee or vanilla, which remain permitted for legitimate technological purposes. Instead, it objected to manufacturers adding “rum flavour” to rum or “whisky flavour” to whisky, saying the practice misrepresents standardized alcoholic beverages.

According to FSSAI, the characteristic taste and aroma of rum and whisky should develop naturally through raw materials, fermentation, distillation and maturation. Products made predominantly from extra neutral alcohol (ENA) and later infused with flavours that imitate the beverage itself could mislead consumers if sold as standard rum or whisky, it said.

FSSAI said laboratory tests on samples from multiple manufacturers found external artificial or nature-identical flavours masking the products' natural characteristics. It cited the Food Safety and Standards (Alcoholic Beverages) Regulations, 2018, which require products such as rum to possess their characteristic taste and aroma, and labelling rules requiring the true nature of the product to be disclosed on the front of the pack.

Poonam Chandel, an industry expert and former managing director of NeuWorld Spirits, said the regulator's action targets a practice that has existed in the Indian spirits industry for decades.

"In India, ENA has been sold as whisky, rum, brandy and vodka for times immemorial. Manufacturers generally add only a small quantity of molasses spirit or grape spirit, even in several premium products, while lower-priced variants are almost entirely ENA-based. FSSAI has finally woken up to the issue. Better late than never," Chandel told Mint.

She said the larger issue was regulatory consistency and due process.

“The practices now being questioned have existed across the alcoholic beverage industry for decades here…If FSSAI believed these practices were inconsistent with the law, why has this interpretation emerged only now? Any significant change in regulatory interpretation should first be communicated clearly to the industry, followed by stakeholder consultations and a reasonable transition period. Abrupt enforcement creates uncertainty for manufacturers, confusion for consumers and could result in substantial revenue losses for states that depend heavily on excise collections,” she added.

Wider legal battle

FSSAI has also questioned age-related claims on certain products, citing Old Monk XXX Rum's "7 years old blended" label as misleading. It said matured rum spirit accounted for less than 5% of the blend, with the remainder comprising neutral spirit. Under existing rules, the age statement of a blended spirit must be determined by the youngest spirit in the blend.

Based on laboratory reports showing non-conformity, FSSAI prohibited the sale of products manufactured by United Spirits, maker of McDowell's No.1 Rum, Antiquity Blue Whisky and Royal Challenge Whisky; Mohan Rocky Springwater, maker of Old Monk rum; Inbrew Beverages, maker of Bagpiper Deluxe Whisky and Old Cask Deluxe XXX Rum; and Associated Alcohols & Breweries, maker of Central Province Whisky and McDowell's No.1 Celebration Matured XXX Rum. It also inspected Mandexi Distilleries & Breweries in Goa and issued notices to six other manufacturers in Maharashtra.

The crackdown has triggered legal challenges from other manufacturers.

On 30 July, Associated Alcohols & Breweries told stock exchanges it had received an FSSAI communication prohibiting the sale of one whisky and one rum brand over the declaration of "artificial flavour" on product labels.

The company said, based on legal advice, it believes its labels comply with the law and reflect long-standing industry practice, and would approach the high court for immediate relief. It added that industry bodies, including the Confederation of Indian Alcoholic Beverage Companies (CIABC) and the International Spirits & Wines Association of India (ISWAI), had also taken up the issue with the regulator.

FSSAI said two manufacturers that appealed the prohibition were granted conditional relief, allowing them to sell existing inventory after clearly disclosing the true nature of the product on the front label. Future production, however, must not add identical flavours such as rum flavour to rum or whisky flavour to whisky.

United Spirits said the matter is also being pursued by CIABC and ISWAI, describing it as an industry-wide concern. The associations believe the declarations on product labels are consistent with long-standing industry practice and comply with the applicable regulatory framework, it said.