But these companies, which have asked the Confederation of Indian Industry to take up their case, denied the charge and said they just had legitimate stocks for ensuring smooth operations and within permissible limits.

From Sep 15, they can hold only 15 days' stocks, ministry officials said.

With elections round the corner in three states and the festival season coming up, the government is keen to ensure the price of sugar does not rise further.

The authorities have already started importing sugar since India's production is expected to have fallen to some 15 million tonnes during the current sugar year, which ends Sep 30, from 26.4 million in the previous year.

Ministry officials said the government has also extended its deadline for tax-free raw imports of raw sugar to December 2010, while refined white sugar can be imported up to a total of one million tonnes till March next year.

Thomas said that while the central government will make every effort to ensure that the people's mood is not soured during the festive season, the states also had an important role to play.

'Actually, there is slight excess of sugar with states. There won't be much of a problem if this can be properly managed by state governments.'

(Biju T.G. can be reached at biju.t@ians.in)