Dabur Nepal's woes mount after vigilance raid

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Sudeshna Sarkar | 21 Dec, 2010
The woes of Dabur Nepal, Indian FMCG giant Dabur India's independent group company in Nepal, mounted Tuesday after state watchdogs raided its storehouse and sealed it with an admonition not to sell and distribute its fruit juices till investigations were completed.

"We have sealed nearly 74,000 cartons of Dabur Nepal's fruit juices," said Ishwori Prasad Poudel, spokesman at the Commission for Investigation of the Abuse of Authority (CIAA), Tuesday.

The commission led the raid on Dabur Nepal's factory and storehouse in Bara district in southern Nepal, accompanied by officials from the Department of Revenue Investigation and Department of Food Technology and Quality Control.

"The cartons contained juices manufactured in November 2010 but the stickers gave the manufacturing date as Jan 11, 2011," Poudel told IANS.

"We are investigating if the licence given to Dabur Nepal allows for the use of a manufacturing date delayed by almost 71 days. If the licence allows it, the stocks will be released. If not, we will take action as per law."

According to the official, the sealed cartons - including Dabur's Real and Real Activ brands of fruit juices - are worth almost NRS 80 million.

The surprise raid with the support of security personnel occurred after a group, the Forum for the Protection of Consumers' Rights, filed a complaint with the CIAA last week alleging irregularities in manufacturing dates.

This is the first time that a multinational company faced raids by state agencies. Tampering with food products is punishable by a prison term of up to five years or a fine of NRS 100,000 or both.

The sealing of the godown will severely hit Dabur's export of Real juices to countries like India and Bangladesh since the Bara factory is the main manufacturing hub.

Dabur Nepal continued to maintain a deafening silence for the second day, declining to comment on the raid or issue a statement.

The Dabur image, which had been repositioned with a new publicity campaign that roped in Nepal's top actors and a pop star, was hard hit Tuesday as the raid hit the headlines in most dailies, following a day of negative publicity on the television channels.

Dabur Nepal, established in 1992, is one of the largest Indian investments in Nepal. Its chairman, Rukma Shumsher Rana, became Nepal's ambassador to India.

Five years ago, Dabur India increased its share from 80 percent to 97.5 percent.

For over three months, Dabur Nepal had faced a media war with a section of the local media alleging that the Real juices sold in Nepal were substandard and found to contain insects and other inedible elements.

Dabur Nepal has refuted the reports, saying its products have been certified by the food quality-control authorities. The adverse media blitzkrieg was regarded as the fallout of it refusing to advertise with certain organisations.