SC reviews recovery of excise duty arrears from defaulting liquor manufacturers

The Attorney General informed the Supreme Court today (13) that all measures have been taken to recover arrears of excise duty from alcohol manufacturing companies that have defaulted on payments.

Additional Solicitor General Nerin Pulle, appearing for the Attorney General, made this announcement during a Fundamental Rights petition filed by social activist Sanjaya Mahawatte, seeking an order to recover excise duty arrears from defaulting alcohol manufacturers.

The petition was heard by a three-judge bench comprising Chief Justice Preethi Padman Surasena, Justice Kumuduni Wickramasinghe, and Justice Sampath Wijeratne, Ada Derana reporter said. 

President’s Counsel Saliya Peiris, representing the petitioner, told the court that the tax arrears of certain companies had increased since the filing of the case. 

He noted that the arrears of W.M. Mendis & Company, which were Rs. 1.29 billion in 2020, had risen to Rs. 1.6 billion in 2024. He added that if the companies had a genuine intention to pay taxes, such a situation would not have arisen.

Meanwhile, President’s Counsel Rasik Saruk, appearing for W.M. Mendis & Company, stated that his client’s alcohol production license had been suspended and that all bank accounts and properties had been frozen.

Additional Solicitor General Nerin Pulle confirmed that affidavits had been submitted to the court detailing all steps taken to recover the arrears, including suspension of licenses and other measures.

After considering the submissions, the three-judge bench, led by the Chief Justice, directed that the petition be taken up again on March 5, 2026, and instructed the parties to provide an update on the progress of recovery efforts on that date.