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 related to billing and discounting practices involving city agencies, a source familiar with the matter said.
Hina Nagarajan, the CEO of Diageo’s Indian unit, United Spirits, was summoned on July 26 to appear before New Delhi police in the case involving the company’s supply of liquor to government agencies running alcohol stores and payments made were received from the city between 2017 and 2020. .
Nagarajan, who is also a member of Diageo’s global executive committee, was asked to appear personally or through company representatives and provide various documents regarding the sale of the company.
Nagarajan did not appear before police, but after the July notice, Diageo, through company representatives, submitted many documents requested for the three-year period, said the source, who declined to be named due to a lack of authority to to talk to the media.
The documents submitted include certain bank statements, records of financial transactions with Delhi city agencies to which liquor was supplied and some agreements signed with them, the source added.
Diageo India and Delhi anti-corruption police did not respond to repeated requests for comment from Reuters.
The company previously called the Delhi case a “routine information and fact-finding investigation” and said it was cooperating with authorities. The company added that it suspected police notices had been sent to other manufacturers.
The Delhi investigation focuses on how companies like Diageo India supplied liquor to government stores, and how those agencies sometimes offered early payments to suppliers who offered discounts, Reuters reported last month.
Police are investigating whether there is any misconduct in this process and whether the discounts that companies give comply with liquor laws. The police had called the CEO of Diageo India as a witness in the case.
New Delhi city rules stipulate that all liquor stores must be run only by government agencies.
The Indian capital is a key market for premium drinks brands, especially for France’s main rival, Diageo Pernod Ricard (EPA:), has been unable to sell its products since late 2022 due to misconduct allegations it faces in another investigation.
Euromonitor estimates that Diageo, the world’s largest spirits maker that sells Johnnie Walker Scotch whiskey and Smirnoff vodka, is also India’s largest with a 19% share by volume of the $35 billion market.
