Old Monk Maker Says Maharashtra Lost ₹300 Crore in Excise Revenue After Plant Shutdown

Mohan Rocky Springwater Pvt. Ltd, the maker of Old Monk rum, has told the Bombay High Court that Maharashtra has lost more than ₹300 crore in excise revenue since the company’s Khopoli manufacturing facility stopped operating in May 2026. The company says the shutdown has also left around 300 workers idle, as it continues to challenge regulatory action by the Food Safety and Standards Authority of India (FSSAI) over the classification and labelling of its alcoholic beverages.

The dispute is about more than one liquor brand or a single manufacturing plant. At its centre is a regulatory question: whether a beverage made using neutral spirit and added rum flavouring can be sold as standard rum, or whether it must be labelled as a rum-flavoured spirit. The outcome could affect the company’s ability to restart operations in Maharashtra, the state’s excise collections and the way alcoholic beverages are labelled in India.

Key takeaways

• ₹300 crore revenue claim: Old Monk’s manufacturer says Maharashtra has lost more than ₹300 crore in excise revenue since the Khopoli factory shutdown. This is the company’s submission to the court, not an independently verified government revenue calculation.
• Around 300 workers affected: The company told the court that approximately 300 workers at the facility have been left idle.
• FSSAI’s objection: The regulator says certain products contain added rum flavouring and neutral spirit, raising questions about whether they meet the standards for sale as rum.
• Labelling remains disputed: The company has offered revised labels, including removing the “7 Years Old Blended” claim, but the wider disagreement concerns the product’s classification as well as its packaging.
• No final resolution yet: The company is challenging the restrictions before the Bombay High Court, and the eventual outcome will depend on the court proceedings and regulatory position.

Why Maharashtra’s ₹300 Crore Excise Revenue Claim Matters

The reported revenue loss brings a financial dimension to the regulatory dispute. In its submission to the Bombay High Court on October 12, the Old Monk maker argued that the shutdown had deprived Maharashtra of more than ₹300 crore in excise revenue since operations stopped in May.

Senior counsel Venkatesh Dhond, representing the company, told the court that alcohol excise is a state subject and argued that Maharashtra was losing revenue because its factory was not operating. He also said around 300 workers had been left idle.

The figure is significant, but it needs to be understood in context. It is the manufacturer’s estimate of revenue foregone during the shutdown. The available reporting does not establish that the Maharashtra government has independently confirmed the amount or published a calculation showing how it was derived.

Excise revenue from alcoholic beverages can include several types of state-level duties, fees and levies. The actual amount collected depends on factors such as production, distribution, sales volumes, product categories and the applicable tax structure. Without a detailed government calculation, the ₹300 crore figure should be treated as the company’s claim rather than a confirmed loss in the state’s accounts.

Even with that qualification, the dispute illustrates how a product-level regulatory restriction can affect multiple stakeholders. The manufacturer faces disrupted production and sales, workers face uncertainty, distributors may lose supply, and the state could miss out on revenue associated with activity at the facility.

What Happened at the Khopoli Factory?

Mohan Rocky Springwater’s Khopoli facility in Maharashtra’s Raigad district has been at the centre of the dispute since May 2026, when restrictions following regulatory action halted the relevant operations and sales in the state.

The company’s challenge concerns FSSAI’s action against selected alcoholic beverage products, including certain Old Monk variants. The regulator’s concerns relate to the use of external flavouring substances and whether the products meet the standards associated with their declared categories.

The distinction matters because a manufacturing facility does not operate in isolation. A shutdown can interrupt production schedules, reduce the movement of goods through the distribution network and affect workers whose jobs depend on the plant’s operations.

The company has argued that Old Monk is manufactured and sold across India and that Maharashtra is the only state in which the product has been banned. It has also described itself as a leading manufacturer of rum, with counsel citing an 88% market share during the court proceedings. That market-share figure is the company’s assertion and should not be treated as independently verified market data.

The Bombay High Court questioned why objections had been raised in Maharashtra if the product was being sold elsewhere in the country. That question highlights the practical tension between a product’s presence in the market and the regulatory standards that authorities say it must satisfy.

However, availability in other states does not by itself settle whether a product complies with the applicable rules. The legal and regulatory issues still have to be assessed on their own merits.

Why FSSAI Says Old Monk Cannot Be Sold as Standard Rum

The regulatory dispute centres on the Food Safety and Standards (Alcoholic Beverages) Regulations, 2018. These regulations establish standards for alcoholic beverages, including expectations about the characteristics associated with categories such as rum and whisky.

In its public explanation of enforcement action against certain alcohol manufacturers, FSSAI said laboratory findings had identified external artificial or nature-identical flavouring substances in products where the regulator believed the added flavours masked the beverage’s natural characteristics.

For Old Monk, the regulator’s position is that the relevant product uses neutral spirit and rum flavouring. It has argued that a beverage made this way should not be sold as standard rum if it does not meet the applicable standard for that category.

FSSAI’s position is not that all flavouring substances are automatically prohibited in alcoholic beverages. Its stated distinction is between permissible flavouring for a legitimate technological purpose and adding a flavour that imitates a defining characteristic of a standardised beverage, such as rum flavour in a product sold as rum.

The regulator has also challenged the “7 Years Old Blended” declaration on an Old Monk variant. In its August 2026 explanation, FSSAI said the product’s major ingredient was neutral, unaged spirit and that matured rum spirit accounted for less than 5% of the product, according to its investigation findings. It argued that the age claim did not comply with the applicable rules.

Those are the regulator’s findings and interpretation, which the manufacturer has challenged through the legal process. The dispute should not be reduced to the claim that adding any flavour to alcohol is unlawful; the issue is whether the specific formulation and label comply with the relevant standards.

The “7 Years Old Blended” Label Dispute

The age declaration has become a separate point of contention in the case. On August 31, the company told the Bombay High Court it was willing to remove the words “7 Years Old Blended” from the relevant label and submitted revised packaging for consideration.

That offer addresses one potential source of consumer confusion: an age statement can lead buyers to believe that the spirit, or the blend as a whole, has undergone a particular period of maturation. The regulator’s position is that age declarations must comply with the rules applicable to the youngest spirit in a blend.

But changing the label does not necessarily resolve the entire case. FSSAI has argued that the central question is not merely what the bottle says, but whether the product itself qualifies to be sold under the standard category name “rum.”

The company has sought to find common ground with the regulator by proposing revised labels. According to the latest reporting, however, it told the court that discussions had failed to produce an acceptable resolution and that the regulator had rejected its product labels twice.

The two issues therefore need to be distinguished. One concerns the accuracy of the age claim and other label declarations. The other concerns whether the product’s ingredients and production method meet the legal definition and standard for rum. A change to the first does not automatically settle the second.

What the Bombay High Court Has Said So Far

The Bombay High Court has been hearing Mohan Rocky Springwater’s challenge to the regulatory action. The company has sought relief that would allow it to resume sales while its case is considered.

In proceedings on August 31 and September 3, the court considered the company’s request for interim relief. In its September 3 order, the court declined to grant an interim order permitting the company to resume selling the product, observing that such relief at that stage could effectively amount to granting the final relief sought in the petition.

The order also recorded that modified labels had been submitted without prejudice to the company’s legal position. The company’s counsel said the labels were offered as a possible route to resolution and could be withdrawn if the respondents opposed them. The matter was then listed for further consideration.

In the latest reported hearing on October 12, the company again raised the shutdown’s consequences, including the claimed loss of state excise revenue and the number of workers affected. The court also questioned why Maharashtra’s position differed from the product’s reported availability elsewhere.

These proceedings do not mean that the company has won its case or that FSSAI’s position has been finally rejected. Nor does the refusal of interim relief, by itself, decide every issue in the main petition. The dispute remains subject to the court’s consideration and the regulatory response to the proposed labels.

What the Dispute Means for Maharashtra’s Liquor Industry

The case raises questions about the relationship between product standards, state excise administration and the commercial impact of regulatory enforcement.

Alcohol excise is an important source of revenue for state governments. Maharashtra’s excise collections come from a broad range of alcoholic beverages and businesses, so the Old Monk dispute represents one part of a much larger revenue system. The manufacturer’s ₹300 crore estimate cannot be used to calculate the state’s total excise loss without additional government data.

The shutdown may nevertheless have consequences beyond the company itself. A plant that stops operating can affect workers, suppliers, transporters, distributors and retailers. If supply of a popular product is interrupted in a market, sales may shift to other brands, although the scale of any substitution in this case has not been independently established.

For the wider industry, the regulatory question is whether products sold under established category names meet the standards attached to those names. Clear and consistently applied rules can help consumers understand what they are buying and create a common framework for manufacturers. At the same time, regulatory disputes can become commercially disruptive when there is disagreement over how a product should be classified or what changes would make it compliant.

The case also shows why the classification of alcoholic beverages is not simply a branding decision. A label communicates information about the product, but it must correspond to the applicable product standard. If a regulator concludes that a beverage does not meet the definition of rum, changing descriptive wording may not be enough unless the revised product and label satisfy the relevant requirements.

What Consumers and Distributors Should Know

For consumers, the dispute does not establish that every Old Monk product across India has been prohibited. The reported action concerns selected variants and restrictions connected to Maharashtra. The scope of any restriction should be checked against official orders and subsequent court or regulatory developments.

Consumers should also distinguish between a product’s familiar brand identity and the technical category under which it is sold. A brand may have a long history, but that history does not exempt its products from current food-safety standards or labelling requirements.

For distributors and retailers, the immediate issue is the availability and legal sale of the affected products in Maharashtra. The company has not received the interim relief it sought in the earlier proceedings, and the regulatory dispute has not been conclusively resolved in the available reporting.

Businesses in the supply chain will need to follow any further court orders, official directions and approved labelling changes. It would be premature to assume either that the plant will reopen by a particular date or that the company will permanently lose access to the Maharashtra market.

The Bigger Picture

The Old Monk case reflects a wider regulatory challenge in consumer goods: how to enforce product standards when a familiar brand’s formulation, claims or labelling are questioned. Regulators have a responsibility to ensure that consumers are not misled, while companies have an opportunity to challenge enforcement decisions and propose compliant alternatives. The outcome depends on the applicable rules and the evidence presented, not solely on a brand’s popularity or its contribution to state revenue.

Maharashtra’s claimed ₹300 crore revenue loss and the reported impact on 300 workers make the economic stakes clear, but they do not determine whether the product meets the legal standard for rum. The case also demonstrates why the label issue and the product-classification issue must be examined separately. A resolution that addresses both would provide greater clarity for the company, regulators, distributors and consumers.

Looking Ahead

The next important developments will be the Bombay High Court’s consideration of the manufacturer’s challenge and the regulator’s response to the revised labels. A settlement or an accepted label change could help move the dispute forward, but the company’s willingness to modify packaging does not itself establish that the product has been approved for sale as rum. The legal position will become clearer only through further court proceedings or an official regulatory decision.

For Maharashtra, the financial consequences will depend on how long the shutdown continues and whether the company can resume compliant operations. The ₹300 crore figure remains the manufacturer’s estimate, while the reported 300 idle workers underline the immediate human cost of the stoppage. Until the dispute is resolved, the case will remain a test of how food-safety standards, consumer labelling and the economic interests surrounding a major liquor brand are balanced.