Telangana Government Takes Firm Stand Against Rice Millers in High Court
The Telangana state government has presented a strong argument before the Telangana High Court, asserting that the large-scale financial diversion by rice millers cannot be dismissed as a simple contractual disagreement. The government has firmly opposed attempts by over 360 millers to quash criminal cases filed against them, emphasizing the serious nature of the allegations.
Massive Financial Misappropriation Uncovered
The criminal cases stem from alleged diversion of paddy supplied for milling and non-payment of dues totaling a staggering Rs 3,960 crore. This amount represents the full value of paddy stocks issued by the government to these millers. With 3,600 rice mills operating across the state, the scale of the alleged fraud has raised significant concerns about systemic vulnerabilities in the procurement and milling process.
Geographic Concentration of Defaults
Among the cases registered against defaulting millers, the majority originate from three specific districts:
- Kamareddy District
- Nizamabad District
- Nalgonda District
The financial defaults in these cases range dramatically from Rs 1 crore to Rs 100 crore per miller, indicating both widespread participation and substantial individual financial impact.
Diversion into Multiple Ventures
According to the state government's submission, the millers allegedly redirected proceeds from the government-supplied paddy into various other business ventures. These diversions reportedly included:
- Film production investments
- Real estate acquisitions
- Asset purchases
- Establishment of new mills under family members' names
The alleged misappropriation came to light during a comprehensive investigation conducted by the civil supplies department several months ago. Following this probe, criminal cases were formally registered against the implicated millers.
Government's Legal Arguments
During the hearing before Justice J Sreenivas Rao on Wednesday, Public Prosecutor Palle Nageswar Rao presented the state's position with compelling arguments. He stated that the millers had deliberately defaulted on payments, creating a significant financial burden on the state exchequer.
Nageswar Rao emphasized that the substantial pending dues are adversely impacting welfare schemes undertaken by the government, potentially affecting public services and development programs across Telangana.
Supreme Court Precedent Cited
The public prosecutor presented before the court Supreme Court guidelines from a similar case involving millers in Bihar. These guidelines mandate the submission of bank guarantees before lifting paddy from procurement centers, establishing a precedent for financial safeguards in such arrangements.
"While the custom milled rice policy requires milled rice to be returned to the civil supplies department within 15 days from the collection date, these millers have been prolonging the matter since the 2022-23 financial year," Nageswar Rao argued. "This extended delay has placed an unnecessary burden on the state's financial resources."
Court Proceedings and Next Steps
The Telangana High Court has adjourned the matter for further hearing, allowing both sides to prepare additional arguments and evidence. The state government has urged the court to dismiss the petitions filed by the millers, maintaining that the criminal cases must proceed to ensure accountability for the alleged financial irregularities.
This legal confrontation highlights the ongoing challenges in agricultural procurement systems and the need for robust oversight mechanisms to prevent similar financial diversions in the future.
