Indian Food Ministry finds GST filing discrepancies at sugar mills

The Indian Food Ministry has found discrepancies in the goods and services tax (GST) details furnished by sugar mills between August 17 and 19 and has initiated actions against them, a note from the ministry said on Thursday.

“The discrepancies are being examined with reference to relevant GST records, sales invoices, buyers’ particulars and dispatch/lifting records. Where the discrepancies are established, appropriate proceeding/action are being initiated against the concerned sugar mills under the applicable provisions of law,” said Arvind Kumar Rawat, Director (Sugar) of the Department of Sugar and Vegetable Oils.

The mills have now been asked to furnish details of sugar sales from August 20 to 31. The mills have to provide details by October 10 (Friday). The details will be cross-verified with GST and physical verification records, the note said.

More verifications

Rawat said the Government has decided to carry out intensive physical verification starting Friday (October 9), and mills must ensure full compliance with the directive.

Authorised government authorities will continue to monitor compliance and undertake physical verification. Any deviation will attract “appropriate action in accordance with the provisions of law”, the note said.

The government said mills have to meet the sales target - 45 per cent of the sales quota allocated for the first week of October and the rest in the second week. Any failure would be treated as a violation, and proceedings would be initiated under the Essential Commodities Act, it said.

The note comes on the heels of the Government’s efforts to curb any surge in sugar prices during the festival, particularly with Dussehra and Diwali ahead.

Reining in prices

Sugar prices, which had soared to about ₹70 a kg in retail outlets (all-India average) in late August, are currently ruling at ₹55.06 a kg. A month ago, they were quoted at ₹61.33 and ₹59.05 a year ago.

The commodity’s prices surged after domestic production was affected due to unseasonal rains and pest attacks, particularly in Uttar Pradesh. The production is now estimated at 30.6 million tonnes compared with initial estimates of over 34.3 mt.

In order to cool prices, the Indian government permitted duty-free import of raw sugar and allowed units which had imported raw sugar for re-exports to divert them to the domestic market till October 31.

In addition, it has come up with stock limit for bulk users who buy over 10 tonnes a month (down to 15 days requirement) and traders. It changed the monthly sale quota allocation to fortnightly .

As a result, prices have declined from the highs witnessed in August.

TN incentive to growers

Meanwhile, the Tamil Nadu government announced that it was providing an incentive of ₹709.50 per tonne of sugarcane to growers for the 2026-27. “This will take the returns to farmers to ₹4,000 a tonne (for 9.5 per cent sugar recovery),” said State Agriculture Minister R Vinod. This will cost the state exchequer ₹603.34 crore. For sugar recovery over 9.5 per cent, farmers will get more than ₹4,000 a tonne, he said.

The incentive is over the State Advised Price of ₹3,290.50 a tonne. However, the incentive will be given based on the recommendations of committees headed by district collectors and officials of Directorate of Sugar. Some 90,000 farmers will benefit from this, said Vinod.