Brewery company Carlsberg is in talks to resolve a commercial dispute with its India partner in light of an internal probe into the company’s local sales practices, Reuters reported on Monday.

The dispute which revolves around loan repayment from Carlsberg’s JV partner in India, the Nepal-based Khetan Group and the partner's wish to sell its stake in the business at "an unreasonably high price" has sparked a major boardroom discussion and concerns from its auditor.

Global auditor PwC's India arm recently declined to provide its opinion on Carlsberg's 2018-19 India results, citing a difference of opinion from three of Carlsberg India’s board members who did not sign-off on the financials, alleging regulatory lapses as per Carlsberg’s regulatory filings.

According to a report by the Economic Times , Carlsberg is investigating its Indian arm for financial irregularities. The probe is into incorrect payments and embezzlement by Carlsberg India as well as the kickback received from customers.

“In 2019, we saw an increasing number of speak up matters related to our Indian business. The Group takes such matters very seriously. We are currently investigating the allegations and will take appropriate measures if they are substantiated,” read Carlsberg’s annual report.

The maker of Tuborg beer is conducting an internal audit of its processes within the Indian business including all matters related to permits and licences as per its regulatory filings.

The audit is being supervised by the Carlsberg Group’s global integrity committee.

Carlsberg had entered into a JV with the Khetan Group in order to enter the India market in 2006 by incorporating South Asian Breweries Pte. Ltd.

The company holds 19 per cent of the Indian beer market.

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