Four officials of the state excise department have been suspended.
The commissioner of the state excise department Shyamsundar Shinde said, "These officials were found to be incompetent and prima-facie it's a case of dereliction of duty".
Even though police has arrested five people in connection with this case, the main accused Mainka Bai, is still on the run. Mainka Bai alias Akka had been booked earlier for the same offence, but she managed to get bail.
The accused have been identified as Francis Thomas D'mello, Salim Mahboob, Raju Hanmanta Pascar, Donald Robert Patel and Gautam Harte. They have been remanded them to police custody till June 26.
Police has collected samples of spurious liquor and sent them for analysis.
Eight police personnel were suspended yesterday; the case is being handled by the Crime Branch.
Mumbai Police spokesperson Dhananjay Kulkarni, told reporters, "senior police inspector (attached to Malwani police station) along with seven other personnel, including three officers and four constables, have been suspended for connivance/negligence".
Chief Minister Devendra Fadnavis had ordered an inquiry into the incident on Thursday night and directed officials to submit the report within two days.
The Excise department claims to have booked as many as 117 cases of illegal distribution of spurious liquor in Malwani in the past one year.
This is the second biggest tragedy in Mumbai in nearly a decade. In 2004, 87 people died after consuming spurious liquor in Vikhroli in the eastern suburbs. Nineteen people were convicted and jailed in connection with the "Vikhroli tragedy".
Get Breaking news, live coverage, and Latest News from India and around the world on NDTV.com. Catch all the Live TV action on NDTV 24x7 and NDTV India. Like us on Facebook or follow us on Twitter and Instagram for latest news and live news updates.