Madras High Court cancels FSSAI licence suspension of A.R. Dairy Food in the Tirupati laddu ghee row.
Court allows ghee-only suspension temporarily, orders fresh review in 4 weeks.
In a recent judgment on Friday, May 16, 2025, the Madras High Court cancelled the suspension of the FSSAI (Food Safety and Standards Authority of India) licence of A.R. Dairy Food Private Limited, a company based in Dindigul.
This suspension was earlier imposed by the central licensing authority under the Food Safety and Standards Act, 2006, on February 14, 2025.
The company had allegedly supplied ghee containing foreign fat instead of pure milk fat to the Tirumala Tirupati Devasthanam (TTD), which uses the ghee to prepare its famous laddu prasadam.
Justice V. Lakshminarayanan, who passed the order, said the matter should be reconsidered by the licensing authority.
The judge pointed out that the authority must think carefully about whether the suspension should apply only to the production of ghee or also to other dairy products made by the company.
He also ordered that a new decision should be made within four weeks, based on his directions.
The court made it clear that, until the licensing authority makes a fresh decision, the FSSAI licence of A.R. Dairy Food will be considered suspended only for ghee production.
Justice Lakshminarayanan said,
“the licence shall be considered to have been suspended only with respect to the manufacture of ghee, until the licensing authority reconsiders the matter and issues fresh proceedings.”
He also noted that a licence suspension under the Act cannot last forever and has a limit.
he observed,
“Suspension of licence could be in force for a maximum period of six weeks and not indefinitely,”
Further, the judge said that if the licensing authority wants to completely stop the company from producing any food items in the future—after confirming that the company really did adulterate the ghee supplied to TTD—it must follow proper legal procedures.
In such a case, the authority should cancel the company’s FSSAI licence instead of just suspending it.
he said,
“If the licensing authority wanted to prevent the petitioner company from making any food products permanently, after arriving at a conclusion that it had indeed adulterated the ghee supplied to TTD, then the only option available would be to cancel the FSSAI licence by following due procedures of law,”
Although the court ruled in favour of the dairy company, it did so on a technical ground. So, Justice Lakshminarayanan directed A.R. Dairy Food to pay ₹2 lakh as costs to the central licensing authority.
This amount must be paid within two weeks. The judge had earlier reserved the orders on April 2, 2025, during a hearing held at the Madurai Bench of the High Court, but the final judgment was delivered at the principal bench in Chennai.
In its defense, A.R. Dairy Food stated in an affidavit that it collects milk daily from around 13,000 suppliers and employs nearly 400 people.
According to the company, the sudden suspension of its licence not only affected the ghee production but also stopped it from making other milk products, which had a big impact on everyone associated with the company. It said the decision was shocking to many.
The company also pointed out that the licensing authority had first issued them an improvement notice under Section 32 of the Food Safety and Standards Act, 2006.
However, this process was suddenly stopped midway, and the licence was suspended instead, on the basis of public interest.
“The licensing authority had initially issued an improvement notice under Section 32 of the 2006 Act but abandoned those proceedings midway and instead suspended the FSSAI licence by invoking the ground of public interest.”
This judgment by the Madras High Court is significant because it reminds authorities to follow the law properly before taking harsh actions like suspending or cancelling licences. It also shows that even in cases where public interest is involved, legal steps and procedures must be strictly followed.
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