Hyderabad: A statewide crackdown by the vigilance and enforcement (V&E) department has uncovered the alleged diversion of govt-procured paddy worth nearly ₹500 crore by rice millers, triggering criminal action and a large-scale recovery drive.Investigators say thousands of tonnes of paddy entrusted to mills for custom milling were neither found in stock nor returned to the govt as rice, causing substantial losses to the state exchequer.Under the custom milling system, the state procures paddy from farmers and supplies it to rice mills, which are required to return the stipulated quantity of rice to the govt within a fixed timeframe.However, officials noticed a widening gap between the quantity of paddy handed over to millers and the rice received by the govt from 2023 onwards. Following this, the chief minister’s office directed the V&E department to probe the irregularities.Civil Supplies Corporation commissioner Stephen Ravindra confirmed that around 90,000 metric tonnes of paddy entrusted to millers was found missing.“So far, 90,000 metric tonnes of paddy stocks have been missing from the millers who seem to have sold it off in the private market. Rice mills in Nalgonda, Warangal, Karimnagar, Sangareddy, Nizamabad, Kamareddy and Suryapet had sold off nearly 90,000 metric tonnes of the paddy which accumulated from the last three years. The amount would be recovered towards paddy,” he said.Raids carried out since July 20 across 15 districts revealed large-scale discrepancies. V&E officials found that around 50 rice mills did not possess the paddy stocks entrusted to them and had also failed to return the corresponding quantity of custom-milled rice to the govt.According to officials, preliminary findings indicate that millers had allegedly diverted and sold nearly ₹500 crore worth of govt paddy in the open market. The inspections were conducted under the supervision of V&E DIG Abhishek Mohanty, and officials expect the figure to rise as the investigation expands.“DS Chauhan is the director general of V&E. He had earlier headed the civil supplies corporation and department as its commissioner and secretary respectively. His stint in the civil supplies came in very handy and raids on suspected mills unearthed Rs 80 crore worth paddy having been sold by three rice mills owned by one family in Jagtial district, another Rs 66 crore worth paddy missing from mills owned by an owner in Nizamabad district and nearly Rs 80 crore worth paddy was found to be sold in private market by a miller in Nalgonda district,” a source in V&E said.The department has begun registering criminal cases against the millers. “We are issuing notices to all such millers to either pay for the paddy which is not available with them or face jail. Under sections 316 and 318 of the BNS and other relevant sections of essential commodities and misappropriation, there is a punishment of at least 10 years’ imprisonment,” a V&E official said.The recovery drive has already yielded significant results. Officials said nearly ₹300 crore of the estimated ₹500 crore worth of diverted paddy has been recovered after notices were issued to mill owners.While several millers have begun repaying the value of the missing stocks, others have approached courts challenging the action.A rice miller admitted that a small section of the industry was responsible for the irregularities.“There are 3,000 rice mills and one should not generalise such cases because of 50-odd rice millers’ wrongdoing. Generally, those who are traditionally or for a long-time in the rice mills business will not indulge in such an activity. Also, selling of govt paddy in such huge quantities by the millers would not have been possible without the knowledge of local civil supplies officials, who are responsible for keeping track of paddy stocks given and milled rice returned to the govt,” the rice miller said.V&E officials said the probe would not be limited to mill owners and that civil supplies and district administration officials would also face action if evidence of collusion emerges during the investigation.
