Archive · 23 Aug 2026
Telangana Intensifies Rice Mill Inspections Over Alleged CMR Fraud
The Telangana government gives paddy to rice mills so it can be turned into rice for public supplies.
Officials say some mills may not have returned all the required rice.
They are checking the mills more closely to find out what happened.
Some owners are accused of selling or misusing the rice instead.
One mill case involves paddy valued at ₹40.96 crore.
Another case involves alleged diversion of rice worth ₹15.70 crore.
The government wants the missing rice or money back.
It also wants to stop similar problems from happening again.
Telangana vigilance officials have intensified inspections of rice mills over alleged misappropriation of Custom Milled Rice (CMR).
Officials are investigating claims that some mill owners invested allegedly misappropriated funds in real estate and the film industry.
A case alleges ARS Industries misappropriated government-supplied paddy worth ₹40.96 crore in Nirmal district.
Ram Laxman Industries is accused of diverting CMR worth ₹15.70 crore, involving 6,170.643 metric tonnes of paddy.
The state has directed officials to recover the amounts, impose penalties and use the PD Act against alleged offenders.
- Who
- Telangana vigilance and civil supplies officials, rice mill owners and operators, and police agencies are involved.
- What
- Officials are intensifying inspections and investigating alleged misappropriation or diversion of Custom Milled Rice and government-supplied paddy.
- When
- The inspections have recently intensified; Khanapur police recently registered one case, while Luxettipet police issued PD Act notices in another.
- Where
- The investigations cover rice mills in Telangana, including districts such as Nirmal and Mancherial, with wider activity in several paddy-producing districts.
- Why
- The state seeks to recover allegedly misappropriated amounts, prevent further diversion and deter repeat offences.
Government Enforcement Position
Mill Owners’ Reported Position
Response to alleged CMR shortfalls
Government Enforcement Position
The Telangana government is directing officials to recover the alleged losses, impose penalties and invoke the PD Act to prevent further diversion.
Mill Owners’ Reported Position
Some mill owners backed by local political leaders are reportedly considering supplying the pending CMR or paying an equivalent amount and penalty.
Inspection and investigation
Government Enforcement Position
Vigilance officials are intensifying inspections, and additional personnel are assisting investigations into alleged fraud.
Mill Owners’ Reported Position
Owners facing CMR cases are reportedly concerned about the deployment of Greyhounds and OCTOPUS personnel during the inspections.
Use of allegedly misappropriated funds
Government Enforcement Position
Officials are probing allegations that money obtained through CMR misappropriation was invested in real estate and the film industry.
Mill Owners’ Reported Position
The articles do not provide a direct response from the accused mill owners to those allegations.
- Main issue
- Alleged misappropriation of Custom Milled Rice supplied through Telangana’s civil supplies system.
- ARS Industries allegation
- Government-supplied paddy worth ₹40.96 crore was allegedly misappropriated.
- Ram Laxman Industries allegation
- CMR worth ₹15.70 crore was allegedly diverted into the black market.
- Paddy allegedly diverted
- 6,170.643 metric tonnes in the Ram Laxman Industries case.
- Legal action
- Luxettipet police issued PD Act notices under Sections 3(1) and 3(2) of the Prevention of Black Marketing and Maintenance of Supplies of Essential Commodities Act, 1980.
- Government directive
- Officials were ordered to take stern action and recover the amounts involved.
- Inspection support
- Personnel from Greyhounds and OCTOPUS have reportedly been deployed to assist civil supplies inspections and investigations.