The Comptroller and Auditor General (CAG), in its latest report on Kerala’s revenue, has criticized the state government for not ensuring that liquor sold in the state is tested by Food Safety Officers (FSOs). CAG has given many grounds for implementing these rules. The report mentions the rules required under the Foreign Liquor Rules and Food Safety and Standards (FSS-Alcoholic Beverages) Regulations, 2018.
Liquor CAG’s demand for quality analysis is based on the definition of ‘food’ in the FSS Act, which states that alcoholic drinks are also a food item. It also states that this Act empowers the FSO to take samples of any food (including liquor) kept for sale.
CAG angry over FSO not getting alcohol testing done
Apart from this, according to the Foreign Liquor Rules, 1953, the liquor sold or kept for sale should be of good quality, unadulterated and should not contain any adulteration which could be used to increase its intoxication.
The Kerala Distillery and Warehouse Rules, 1968 also states that colouring/flavouring materials and essences used in the manufacture of liquor have to be approved by the Excise Commissioner and must be kept in the custody of the officer in-charge of the distillery.
When CAG officials checked the liquor manufacturing records, it was proved that the FSO had not taken samples for analysis. Also, other than spirit, other raw materials and their components were not approved by the Excise Commissioner and were not in the custody of the Excise Department. The CAG report states that non-testing of liquor samples by the FSO compromises the quality assurance framework.
Compromise on quality assurance in liquor
“The use of raw materials, such as coloring and flavoring agents, without prior approval from the Excise Commissioner, and keeping them outside the custody of the Excise Department, represents a major regulatory lapse,” the report said. In its defence, the government replied that liquor is sent for sale only after getting the chemical analysis certificate from the government laboratory.
The government responded, “Since there is no provision in the Excise Rules empowering the Food Safety Department to take samples of liquor, the Excise Department is not in a position to enforce such rules. However, necessary instructions have been issued to excise officials to ensure compliance with FSSA standards in distilleries, bottling units and breweries.”
According to CAG, this observation pertains to the Commissioner not approving raw materials other than spirit and they were not in the custody of the Excise Department. Apart from this, the right to take samples by the Food Safety Department comes under the rules of the Food Safety and Standards Act, 2006.
Lack of revenue in liquor and transport sector
In its report, CAG has identified problems related to lack of revenue and compliance in the liquor and transport sectors of the state as well as other departments. This report is on the state’s wealth for the year ending March 2024, which was presented in the state assembly on Tuesday.
According to this, Kerala’s revenue receipts for 2023-24 stood at Rs 1,24,486.15 crore, which includes the state’s own revenue of Rs 90,674.97 crore and Rs 33,811.18 crore from the central government.
The CAG also reported revenue arrears of Rs 30,308.52 crore, which is 24.35 per cent of the state’s total revenue, and said audit observations worth Rs 4,978.61 crore were outstanding till June 2024.
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