Liquor Bodies Move Supreme Court Against NCLAT Ruling Holding Kerala's Jawan Rum Preference Did Not Harm Competition

The Confederation of Indian Alcoholic Beverage Companies (CIABC) has moved the Supreme Court challenging a May 20, 2026 judgment of the National Company Law Appellate Tribunal (NCLAT).

The NCLAT had upheld the Competition Commission of India (CCI) decision rejecting allegations that preferential treatment accorded to state-owned Jawan Rum by the Kerala State Beverages (Manufacturing and Marketing) Corporation (KSBC) amounted to abuse of its dominant position.

The appeal, filed on July 24, is yet to be listed before the Supreme Court.

A bench comprising Judicial Member Justice Mohd Faiz Alam Khan and Technical Member Naresh Salecha dismissed the appeal filed by CIABC and the Association of Distillers, Brewers and Vintners of India (ADBVI) against the CCI's order dated October 21, 2021 which had closed the information under Section 26(2) of the Competition Act after finding no prima facie case of abuse of dominance.

"The Appellants had not been able to demonstrate as to how competition, in general, with the existence of so many brands in the market, is adversely affected by granting such preference to Respondent No. 2. The Appellants had also not been able to demonstrate, in their submission, that any favour accruing to one product has actually resulted in distortion of demand/consumer preference or that the choice of consumer is being impaired.”, the tribunal observed. 

The industry bodies had approached the CCI in April 2021, alleging that the Kerala State Beverages (Manufacturing and Marketing) Corporation (KSBC) abused its dominant position as the State's exclusive wholesale liquor procurer by unilaterally fixing purchase prices, imposing unfair tender conditions, granting preferential treatment to government owned brands, delaying payments and levying discriminatory charges.

They also challenged the preferential treatment accorded to Travancore Sugar and Chemicals Ltd's "Jawan Rum."

The Tribunal however, held that the appellants failed to substantiate their allegations with credible evidence. It noted that they could not demonstrate losses suffered by manufacturers, market exits, or any material warranting an investigation by the CCI.

On the challenge to the preference accorded to Jawan Rum, the Tribunal noted that the preference was expressly provided under the State's tender policy and observed that the appellants had failed to show any adverse effect on competition.

The Tribunal upheld the CCI's decision closing the proceedings, holding that the allegations were unsupported by concrete evidence demonstrating harm to competition.