MAHARASHTRA EXCISE DOCUMENT ANALYSIS

Document Type: Government Resolution (शासन पूरर्पत्र / Shashan Purarnpatra — Policy Clarification)

Reference Number: MYS 1221/Pr.Kr.214/RAOSHU-2

Issued By: Government of Maharashtra, Home Department (गृह विभाग), issued by Deputy Secretary U. B. Ajetraon

Date of Issue: 20 May 2021

Effective Date: From date of publication (20 May 2021)

Digital Portal ID: 202105211519014429

SUMMARY

This Government Resolution clarifies the policy for production, storage, and sale of ethanol (anhydrous ethanol, rectified spirit) derived from B-heavy molasses in Maharashtra. During the COVID-19 lockdown, there was a blockage in lifting anhydrous ethanol from B-heavy molasses due to reduced demand. The State Government, following Central Government guidelines (Ministry of Consumer Affairs, Food & Public Distribution, Orders dated 19.11.2019, 22.01.2019, and letter dated 13.08.2020), hereby permits license holders to produce Rectified Spirit (RS — शुध्द मद्यार्क) and Extra Neutral Alcohol (ENA — अतिशुध्द मद्यार्क) from B-heavy molasses in addition to anhydrous ethanol, subject to central government supply contracts with oil marketing companies. The State Government assumes no liability for supply obligations; all contractual responsibility rests solely with the license holder.

KEY PROVISIONS

Policy Authorization & Scope

• License holders permitted to produce:
  • Rectified Spirit (RS) — शुध्द मद्यार्क (pure/rectified alcohol)
  • Extra Neutral Alcohol (ENA) — अतिशुध्द मद्यार्क (extra-neutral alcohol)
  • Anhydrous Ethanol — निर्जल मद्यार्क (continues as per existing policy)
  • All from B-heavy molasses — बी-हेवी गुळाचा राज

Precondition for RS & ENA Production

• License holder must have entered into a supply contract with Oil Marketing Companies for ethanol supply per Central Government policy
• No production of RS/ENA is permitted in the absence of such contracts with oil companies
• License holders wishing to produce RS/ENA (beyond anhydrous ethanol) may apply — no blanket permission granted without oil company contracts

Liability & Risk Allocation

• All contractual obligations, supply obligations, and fulfillment of supply contracts rest exclusively with the license holder — संबंधित घटक (the entity/license holder)
• State Government assumes ZERO liability — "राज्य शासिाचे कोणतेही दायित्व राहणार नाही"
• Any failure to meet oil company supply contracts is the sole responsibility of the license holder
• License holders indemnify the State from all claims arising from contract non-performance

Applicable Central Government Guidelines

The following Central Government Orders/Letters are the regulatory basis:

1. Order dated 19.11.2019 — Ministry of Consumer Affairs, Food & Public Distribution, Government of India
2. Office Order No. 4/1/2018 (BP&E) (Part-I), dated 22.01.2019 — Ministry of Consumer Affairs, Food & Public Distribution, GOI
3. Letter No. 1(11)/2019-SP-I, dated 13.08.2020 — Ministry of Consumer Affairs, Food & Public Distribution, GOI

Related State Government References

• State GR No. VINAYSE 0120/Pr.Kr.07/RAOSHU-2, dated 14.10.2020 — Previous policy framework on storage and sale of ethanol from sugar/cane juice/B-heavy/C-heavy molasses
• Commissioner of State Excise Letter No. VINAYSE 112021/18270/35/Char, dated 20.05.2021 — Implementation directive

Scope of Permitted Raw Materials

Production from the following permitted:

• Sugar — साखर
• Jaggery/Molasses — साखरेचा पाक
• Sugarcane Juice — उसाचा रस
• B-Heavy Molasses — बी-हेवी
• C-Heavy Molasses — सी-हेवी

WHO IS AFFECTED

• All licensed ethanol producers in Maharashtra (holding permits/licenses for alcohol production from sugar/molasses)
• License categories affected: Distillery licenses for ethanol production from molasses (including B-heavy and C-heavy molasses units)
• Specifically: Entities currently producing anhydrous ethanol from B-heavy molasses
• New applicants: Any existing licensee wishing to add RS/ENA production capacity

IMPORTANT NOTES / CONDITIONS / PENALTIES

Mandatory Conditions for RS/ENA Production

1. Oil Company Contract is Prerequisite:

   • No license shall be granted or amended to permit RS/ENA production unless the applicant has executed a supply contract with an Oil Marketing Company (as per Central Government policy)
   • Evidence of such contract must be submitted at the time of application

2. No State Guarantee of Market Off-take:

   • The State Government does NOT guarantee purchase of any quantity produced
   • The State Government does NOT assume any liability if the license holder fails to supply contracted volumes

3. License Holder Indemnification:

   • The license holder accepts full responsibility and liability for:
     • Fulfillment of all contractual supply obligations
     • Any breach or delay in supply
     • All claims, damages, or disputes arising from non-performance of supply contracts
   • This is explicitly stated in the Resolution to absolve the State of all liability

4. Production Beyond Anhydrous Ethanol:

   • Currently, under the existing policy framework (Ref. GR dated 14.10.2020), production is restricted to anhydrous ethanol only from B-heavy/C-heavy molasses
   • This Resolution grants freedom to produce RS and ENA in addition, but only if an oil company contract exists
   • Any license holder desiring to produce RS/ENA must make a fresh application with oil company contract evidence

No Blanket Permission

• This is NOT a blanket authorization to all license holders
• Each applicant must independently establish the oil company contract
• The State will not entertain requests for RS/ENA production without documented oil company supply agreements

COVID-19 Lockdown Context

• The Resolution acknowledges that anhydrous ethanol lifting from B-heavy distilleries was blocked due to COVID-19 lockdown restrictions
• This policy addresses the liquidity/market issue for B-heavy producers by permitting diversification into RS and ENA (which have different market demand profiles)
• However, this is conditional on pre-existing oil company supply contracts

Appeals & Further Queries

• Not explicitly mentioned in this Resolution
• Standard appellate procedures under the Bombay Prohibition Act, 1949 and Maharashtra Excise Rules would apply
• Queries on implementation to be addressed to: Commissioner of State Excise (आयुक्त, राज्य उत्पादन शुल्क), Mumbai-23, or relevant Divisional Deputy Commissioner of State Excise

DISTRIBUTION & IMPLEMENTATION

This Resolution was issued to:

1. Chief Secretary, Principal Secretary to Chief Minister
2. Opposition Leader, Legislative Council/Assembly
3. Secretary to Deputy Chief Minister
4. Private Secretary to State Minister of Excise
5. Chief Secretary, State of Maharashtra
6. Principal Secretary (Excise), Home Department
7. Commissioner of State Excise — Primary implementing authority
8. Sugar Commissioner, Maharashtra State, Pune
9. Divisional Deputy Commissioners of State Excise (all divisions)
10. Superintendents of State Excise (all divisions)
11. RAOSHU-2 — for records

CRITICAL LEGAL INTERPRETATION

Restrictive Nature of This GR

Despite the title suggesting "permission" (परिवर्तनीबाबत = regarding alteration/modification), this is not a blanket authorization. It is a conditional policy statement that:

1. Reiterates the existing restriction (ethanol only from B-heavy molasses)
2. Creates a narrow exception (RS/ENA permitted) IF AND ONLY IF oil company supply contract exists
3. Explicitly disclaims State liability — emphasizing that this is a high-risk activity and the State will not stand behind supply obligations

Legal Effect

• Existing policy framework (GR dated 14.10.2020) remains in force
• This GR modifies that policy only for applicants with oil company contracts
• License holders without such contracts cannot apply for RS/ENA production
• The State has structured this to avoid becoming a party to commercial supply arrangements

Enforcement Authority

• Commissioner of State Excise and Divisional Deputy Commissioners will process applications
• Approval is conditional on submission of oil company supply contract evidence
• Standard license conditions (quality, storage, tax payment, audit) continue to apply

DOCUMENT AUTHENTICITY

• Digitally signed by Deputy Secretary U. B. Ajetraon
• Website availability: Available on www.maharashtra.gov.in
• Portal reference: 202105211519014429
• Issued under: Orders of the Governor of Maharashtra, Home Department

CONCLUDING NOTES

This Resolution is a policy clarification and conditional authorization, not a general license grant. License holders should:

1. First establish an oil company supply contract (with Oil Marketing Companies like IOCL, HPCL, BPCL, etc.)
2. Then apply to the Commissioner of State Excise (or Divisional Deputy Commissioner) for license modification to include RS/ENA production
3. Submit evidence of the oil company contract with the application
4. Accept all contractual risks — the State is explicitly NOT responsible for market demand or supply obligations

The policy addresses the COVID-19 lockdown impact on B-heavy ethanol production by offering diversification into RS/ENA, but only to those with pre-existing commercial arrangements with oil companies.