HYDERABAD: The Crime Investigation Department (CID) has registered three cases and arrested 14 rice millers over alleged irregularities in the supply of fine variety (Sanna Rakam) rice to the Food Corporation of India (FCI). The potential bonus-related financial implication is estimated at Rs 242 crore.
In a press release, the CID said it launched an investigation into alleged irregularities in rice deliveries during the 2025-26 Kharif season following a complaint by the General Manager (Procurement) of the Civil Supplies Corporation on October 24.
The government procured 71.86 lakh metric tonnes of paddy during the season, against a target of 59.60 LMT of rice for delivery to the FCI. Preliminary findings suggest that some millers allegedly diverted the allotted Sanna Rakam paddy to the open market and supplied cheaper coarse rice, including rice reportedly sourced from outside Telangana, instead.
Inspections by Enforcement and Task Force (ETF) teams, followed by laboratory tests, reportedly found that rice samples supplied in the cases examined did not conform to the Sanna Rakam variety specified in the allotments. The alleged substitution could violate the Custom Milled Rice (CMR) agreement and cause financial losses to the government.
In Nizamabad, Karimnagar and Mulugu districts, 16 rice mills reportedly supplied 3,385.820 tonnes of coarse variety (Doddu Rakam) rice against Sanna Rakam allotments. The estimated bonus-related loss on these deliveries is Rs 1.69 crore.
Intervention by civil supplies dept prevented further losses: CID
Another 45,414.833 tonnes of rice had reportedly been allocated for conversion, with the potential bonus-related financial implication estimated at Rs 242 crore.
The CID said timely intervention by civil supplies officials and orders halting further deliveries had prevented additional potential losses. The alleged substitution prima facie indicates violations of the 2025-26 Kharif Marketing Season (KMS) CMR agreement, criminal breach of trust and conspiracy to cause wrongful loss to the government, it said.
Separately, authorities have identified 42 defaulting rice mills in Karimnagar district in connection with CMR irregularities. The CID is also probing suspected collusion between rice mill owners and district officials.
In Nizamabad district, sources said cases had earlier been registered against several millers over pending CMR deliveries.
While some had approached the courts, others had reportedly reached settlements with the department over outstanding dues or stocks.
(With inputs from Karimnagar & Nizamabad)