Fin. Min. rejects Excise proposal to bring Mendis back on track

W. M. Mendis and Co. remains shut for three months

14 March 2025 04:02 am Views - {{hitsCtrl.values.hits}} 28 Bookmark

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Colombo, March 14 (Daily Mirror) - The Department of Excise, the competent authority managing the liquor industry is left with no other option but to seek the Attorney General’s assistance to deal with the Rs.5.8 billion tax evading W. M. Mendis and Co., as the financial plan proposed by the former to get the liquor giant back on track has reportedly been rejected by the Ministry of Finance, the Daily Mirror learns.

The Excise Department following several timely warnings made throughout last year took measures to revoke the licences of the local liquor giant W. M. Mendis and Co. on December 4, 2024 for not paying its dues to the government that had ultimately accumulated up to a staggering Rs.5.8 billion.

Within this period, the company's entire production was ceased and no business was happening to at least pay the dues to the state until the Excise Department proposing a plan to recover the losses to the government thus granting an opportunity to the company to recommence its operations, where 1, 300 livelihoods were dependent on it.

The Daily Mirror earlier reported how the newly appointed Excise Chief U L Udaya Kumara Perera proposed to the liquor giant to get its operations back on track by first agreeing to pay half of the due amount of Rs.5.8 billion. The proposal also suggested getting its licences reactivated up to one month and continuing business by paying the monthly taxes and another installment of the remaining dues by the end of the first month.

However, the Daily Mirror learns that to this proposal the Fiscal Policy Unit of the Ministry of Finance had not responded positively due to the reasons best known to them and rejected it leaving the competent authority of the liquor industry with no other option but to seek assistance from the Attorney General to simply sue W. M. Mendis and Co.

When the Excise sent papers to the legal draftsman to prepare a case against the liquor company, the Ministry of Finance wrote again to the former asking for another proposal or option to get the company to pay its dues.

Three full months have passed to the beginning of March since the operations of W. M. Mendis and Co was stalled, and the matter now lies with the AG’s Department to implement legal action against the former with no probable way of getting the dues paid to the state in a practical sense.

Comments - 28

Terrence K Friday, 14 March 2025 04:48 AM

The Company is a going concern it should be given the opportunity to start up operations since the employees jobs are at stake. Everything depends how the Company is achieving its targetted profits which is the predominant factor for taxes to be paid. Why not come into an agreement with the Company to install an Authority of the government to co-ordinate the operations with the other directors of the Company so that they will have a clear understanding of the focus of the Company. To resuscitate the Company a moratorium should be given so that defaulted taxes could be paid over a period and if necessary at the initial stages to write off some part of the taxes which will boost the Company in its working capital. When drastic policy decisions are taken by the government without giving thought to the future of the Company the present taxes will not be forthcoming. The government should be prudent to take policy decisions looking at the Company's past profits and the taxes paid so far!!!

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Citizen Friday, 14 March 2025 12:33 PM

We know who the owners are. We know how they play the game. Write of some part of the Taxes is a joke Mr Terrence. First of all we must question why the company failed to pay this much of taxes. The proposal looks good but add interest for the amount too. If not agreeable take over the property and recover.

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AS FOR THE TAX OFFICE, THE STAFF IN CHARGE OF THE COMPANY'S ACCOUNT SHOULD BE PUT BEFORE A COURT OF LAW, WE BET THEIR NESTS WOULD HAVE BEEN FEATHERED BY THE COMPANY . Friday, 14 March 2025 07:44 PM

WELL SAID CITIZEN, THE COMPANY SHOULD REMAIN CLOSED UNTIL THEY MAKE FULL PAYMENT OF THE UNPAID TAXES, NO ONE SHOULD BE LET OFF SCOTT FREE. IT APPEARS THE OWNERS/DIRECTORS MAY HAVE FEATHERED THEIR NESTS IN THE PROCESS, IF THEY FAIL TO PAY CONFISCATE PROPERTY AND FREEZE BANK ACCOUNTS OR MONEY WILL MOVE LIGHT LIGHTENING (IF NOT ALREADY MOVED). WHY GIVE THEM TIME TO PAY??. IF THEY WERE HONEST, THEY SHOULD HAVE COME OUT AND EXPLAINED THE SITU AND ASKED FOR TIME TO PAY. IF AUDITING SHOWS X AMOUNT OF TAX DUE, WELL THEY GOT THE MONEY IN SO WHAT HAPPENED!!!. AS FOR THE WORKERS, THEY SHOULD FILE A CASE AND ASK THE COMPANY TO PAY THEM THEIR LOSSES, PERIOD.

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wickrama Wijayasiri Friday, 14 March 2025 05:21 AM

With the Tax Evasion and Bond Scam, this family of owners have done enough damage to our economy, big time. Sorry about the employees, but rules are rules.

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Rasi Friday, 14 March 2025 05:40 AM

Whatever the previous governments have done, if they come up with a proposal to pay back the taxes due within a certain period, there is no issue in giving them the license back. However, they should be given only a limited number of time, like six months, to pay everything back. This is the normal practice in other countries as well. They can also charge them an additional fee for the delay to push them to pay it sooner. This can be practised by different people and organizations as well. This is a good way to bring the tax-paying system in place and encourage people to pay taxes and run businesses.

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Aloysius Friday, 14 March 2025 05:46 AM

Nandalal was the deputy of Arjuna Mahendran during the bond scam.

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Ram P Friday, 14 March 2025 05:46 AM

Please move court to recover the dues and if not paid to sell all assets of the Company. Also obtain an injunction preventing the Company from selling any of the assets. This being a private Company check the ways to seize all assets of the Directors. If stringent laws are brought in thse defaults will not happen. After all this VAT is already collected by the Company from the consumers

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P C Ranawaka Friday, 14 March 2025 05:47 AM

What about Ravi K and Rajitha S ?

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BnW Friday, 14 March 2025 05:52 AM

The reason why the company is unable or doesn't agree to pay taxes is, the tax money may have been shared among state officials for a long time.

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P Kunchithapathan Friday, 14 March 2025 06:06 AM

Liquor and cigarettes are transacted strictly on a cash basis, as manufacturers do not extend credit for the sale of alcohol. The retail price of liquor already includes the government's tax, which has been duly paid by consumers at the point of purchase. Given the substantial revenue involved, it is highly unjust for company directors to engage in tax evasion of this scale. To ensure timely and full remittance of tax obligations, the Excise Department should establish dedicated offices within all distilleries, facilitating rigorous oversight and prompt payment to the government.

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Alex Friday, 14 March 2025 01:09 PM

As you say it would be prudent to take it over under the government and introduce a brand of liquor at a very nominal fee as it would be costly for the government to set up a another unit to produce liquor at a lesser price to combat the kissing menace

0 0

Man Friday, 14 March 2025 06:51 AM

What is the reluctance to take legal action and confiscate those places to recover the due amount of all the tax evaders by auctioning those?

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IME TO AUDIT, PROBABLY FEATHERING OF NESTS !! Friday, 14 March 2025 06:56 AM

EXCELLENT DECISION, DO THE SAME WITH ALL COMPANIES NOT PAYING UP THEIR DUES, SURE GOT TO BE WAY MORE THAT W,M, MENDIS.

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S.P.Ramkumar Friday, 14 March 2025 07:36 AM

Mr. Minister, W.A.Mendis is the one of the oldest distillery company. It had export several type of local flavor sprits to several countries. You should have allowed them to make production and settle their Dues. You can create supervising management system through includingCreditors in Excise department, IRD, and Perpetual Capital Ltd. If you have a mentality of revenge on W.A.Mendis Plc because of your inability to bring Arjun Mahendran you will a one of the revenge taker line as like earlier Government rulers. Example: J.R.J Vs Dhasa Group, CBK vs Maharajah, MR vs Ceylinco Group. if you not allow to start operation then you also one of the economy disaster then AKD vs Mendis. wouldn't you ???????

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Jude Fernando Friday, 14 March 2025 08:28 AM

What an idiotic state bureaucracy. The company is closed for several months, hence no production nor any revenue generation. Company bank accounts also are blocked. So authorities must be thinking of plucking the dues from trees!

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Seeya Friday, 14 March 2025 08:39 AM

They cant say that they dont have money, they have already charged customers for the tax that they havent paid to government. Its all mismanagement, no point in giving them another chance. What if they dont pay still? Maybe take the assets of the company and the directors to the government and auction them off.

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Chandra De Silva Friday, 14 March 2025 08:49 AM

Possibly their assets are less than the dues accumulated, hence they must be thinking of starting a new production facility with new machinery. The people responsible for the accumulation of this debt should be brought before Court. Also the owners must not be allowed to start any new venture in Sri Lanka and all their family assets confiscated. With the NPP majority in Parliament at least bring new laws which are backdated. This is the only way to bring these crooks to book!!

0 0

R.T.Silva Friday, 14 March 2025 09:28 AM

Freeze all of their bank accounts and family bank accounts, and stop all of them going out of the country until all dues are paid. Only way to punish these rogues .

0 1

Nimal Friday, 14 March 2025 09:37 AM

Is allowing a crooked company to operate again the best way to recover taxes due? Sell any building and lands they have.

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Jude Friday, 14 March 2025 10:10 AM

Don't allow the liquor company to recommence operations. Coz they're not going pay the outstanding taxes in short time once they start operations they'll take like 5-10 years to payback outstanding taxes. Former regimes effected 20 million Lankans livelyhood!!! Seize the assets and selling to New owner. Can't understand why the AG department can't prosecute wm Mendis owners for the outstanding taxes, This back taxes Case dragging for way too long.

0 1

Rip Winkle Friday, 14 March 2025 10:28 AM

Someone somewhere waiting patiently for a hefty bribe?

1 0

Mendis and Co are surely being lavish with their free arrack to get free Friday, 14 March 2025 10:59 AM

Mendis

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Who is giving gifts media to advocate for Mendis Friday, 14 March 2025 11:20 AM

Government should be looking to recover well more than 6 billion rupees with the interest due for the already overdue taxes. Mendis and its agents are trying to curry favour with media by giving gifts, lets say free bottles of product or perhaps money for media to speak for Mendis to be free of the billions of due taxes, and allow public to greatly suffer for not getting due taxes.

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Arrack Friday, 14 March 2025 12:01 PM

This company was a well-respected company during the time it was owned by the late Mr. Mendis. After the Bond scam man took over, what they do is produce massive quantities of tax-unpaid arrack. He went to the extent of illegally printing excise stickers to push his tax-unpaid arrack. He then defaulted on the taxes on the smaller portion of the tax paid. The Excise Department may be able to recover a portion of the taxes that were lost by resuming operations. However, this will enable the company to defraud the state by generating substantial quantities of unpaid arrack taxes.

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Ravi Friday, 14 March 2025 12:51 PM

The company has to go into liquidation as it cannot pay its creditors namely the government. In a situation like that you appoint an administrator to run the company to make it a going concern. In the process the company will pay the government dues. When the company is a going concern your put the company on the market for sale at a price and recover whatever dues. Now nothing is happening. It is really idiotic to have the place close down where the machinery would be depreciating at a faster rate.

0 1

Mastercard Friday, 14 March 2025 01:39 PM

Ravi- You have the BRAINS

0 0

ajith Friday, 14 March 2025 04:15 PM

They have already sold off some of their assets. Cancel their civic rights and jail them and confisticate what ever that can be confisticated, including their houses, so the family have no place to live

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RanjithT Friday, 14 March 2025 07:40 PM

It sound stupid to stop operations of a cash cow. Yes they have defaulted owners have got entangled in other issues. Comrade should get out of revenge mentality and be pragmatic. Convert dues to a long term loan with a repayment plan. Convert part into equity where majority shares are held by the general treasury. NPP was boasting of intellectuals living abroad willing to come and help. Get those to be board members and start operations. Then under government control pay all dues in time for the new production. Make profits then list in the CSE in line with the requirements and subsequently sell shares and divest all government shares. Obviously government can earn a thumping sum on higher share value. At the end of the day government recovers all dues and make the facility operational. You cannot earn from a dead duck. make it lay to sell the eggs. Where are NPP think tanks??????Ha. Ha. Haaaaaa

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