By Aditya Kalra
NEW DELHI (Reuters) – Spirits group Diageo (LON:)'s Indian unit has submitted financial documents requested by New Delhi's anti-corruption police in an investigation into billing and discounting practices involving city agencies, a source familiar with the matter said.
Hina Nagarajan, chief executive of Diageo's Indian unit United Spirits, has been summoned to appear before the Delhi police on July 26 in the case related to the company's supply of liquor to government agencies that run liquor stores and payments received from the city between 2017 and 2020.
Nagarajan, who is also a member of Diageo's global executive committee, was asked to appear in person or through company representatives and provide several documents related to the company's sales.
Nagarajan did not report to police, but after the July notice, Diageo, through company representatives, produced many documents that were sought over the three-year period, said the source, who asked not to be identified because he lacked authority to speak to the media.
The documents submitted included certain bank statements, records of financial transactions with the Delhi city agencies to which liquor was supplied and some agreements signed with them, the source added.
Diageo India and Delhi's anti-corruption police did not respond to repeated requests for comment from Reuters.
The company had earlier called the Delhi case “a routine information and fact-finding exercise” and said it was cooperating with authorities. The company added that it believed police may have sent notices to other manufacturers.
The Delhi investigation focuses on how companies such as Diageo India supplied liquor to government-run stores and how those agencies sometimes offered advance payments to suppliers offering discounts, Reuters reported last month.
Police are investigating whether any irregularities were committed in this process and whether the discounts given by the companies were in compliance with liquor laws. The police had summoned the managing director of Diageo India as a witness in the case.
New Delhi city rules require that all liquor retail outlets be run solely by government agencies.
The Indian capital is an important market for premium spirits brands, even more so for Diageo, as its main rival, the French Pernod Ricard (EPA:), has been unable to sell its products at retail since late 2022 due to allegations of irregularities it faces in a separate investigation.
Euromonitor estimates that Diageo, the world's largest spirits maker that sells Johnnie Walker Scotch whisky and Smirnoff vodka, is also the largest in India, with a 19% market share by volume in a $35 billion market.
!function(f,b,e,v,n,t,s){if(f.fbq)return;n=f.fbq=function(){n.callMethod? n.callMethod.apply(n,arguments):n.queue.push(arguments)};if(!f._fbq)f._fbq=n;n.push=n;n.loaded=!0;n.version=’2.0′;n.queue=();t=b.createElement(e);t.async=!0;t.src=v;s=b.getElementsByTagName(e)(0);s.parentNode.insertBefore(t,s)}(window, document,’script’,’https://connect.facebook.net/en_US/fbevents.js’);
