MCA inspects Sula Vineyards' books for suspected misrepresentation: Sources

The Ministry of Corporate Affairs has started inspection of books of famous wine company Sula Vineyards. The Ministry started inspection on suspicion of falsification of books of accounts and misrepresentation of the true picture of their financials.

“We have found some instances of misrepresentation of accounts in the preliminary inquiry,” a source close to the development told Moneycontrol.

The probe is being carried out by the Western Regional Director office of Ministry of Corporate Affairs.

When asked for comments, the company said: "Sula Vineyards (SVPL) and its management have always set a very high standard of corporate governance. SVPL has strived to ensure compliance with all applicable regulatory and statutory laws. Our accounts are audited by one of the leading audit firms in the country. The audit report for the last five years is unqualified and stated as true and fair in conformity with the accounting principles generally accepted in India."

"MCA had recently issued notices for inspection of our books of accounts, which was duly carried out by the MCA officials. SVPL is cooperating fully in the matter and has provided all documents as required under Company law to the satisfaction of the officials. No further action has been taken at this point," the company added.

This is not the first time Sula Vineyards has been under the authorities’ lens.

In November 2017, the Income Tax department carried out searches around 20 premises of company in Nashik and Mumbai. Sula Vineyards Managing Director Rajeev Samant was called by Enforcement Directorate in connection with a cash deposit made a company that was related to NCP leader Chhagan Bhujbal. However, no wrongdoing was proved in that matter.

Rajeev Samant established Sula Vineyards in 1999, as Nashik's first winery. Over the next decade, Sula’s success triggered the creation of as many as 35 other winery companies in Nashik and surrounding areas.

Sula currently sells a million a million bottles a month of its wines such as Sula Zinfandel, Sula Cabernet Shiraz, Sula Cabernet Sauvignon, Dia Red, Dia White, Riesling and Sauvignon Blanc, apart from a range of imported selections.

It exports to over 25 countries. Last fiscal, Sula’s turnover stood at about Rs 500 crore.

Update: This article has been updated to incorporate the company's response.