The son of well-known Bulgarian businessman Grisha Ganchev, Danail, and four other people, detained during the special police operation codenamed "Sugar," are to remain permanently behind bars.

The ruling was issued on Wednesday by the specialized court of appeals, which thus upheld an earlier decision by the Special Tribunal, widely known as the anti-mafia Court.

The only defendant to be placed on house arrest is Kameliya Mircheva, a member of the "Litex Commerce" Supervisory Board on grounds of poor health condition and being the single mother of a teenager.

Danail Ganchev, Milko Talev, Ivaylo Talev, Todor Simeonov, Milko Dimitrov and Kameliya Mircheva are charged with large-scale tax evasion and participation in organized crime.

Grisha Ganchev is the owner of the Litex FC and the Litex company, based in the northern Bulgarian city of Lovech. As of the end of 2011, Ganchev's joint venture with the Chinese company Great Wall Motors, Litex Motors, started the production of Chinese cars for the EU market in the Litex Motors factory near Bulgaria's Lovech, in the village of Bahovitsa.

Earlier this month officers of the Bulgarian Unit for Combating Organized Crime GDBOP and the National Revenue Agency busted what is said to be organized crime group that incurred losses worth hundreds of millions of levs to the state budget, according to the Interior Ministry.

The special operation resulted in six arrests, including Ganchev's son.

Initial reports state that the VAT fraud scheme was invented by the CEO of a commercial company selling large quantities of sugar to retailers.

The sugar is provided from a joint venture in charge of the Bulgarian sugar production plants in Burgas and Devnya.

The Interior Ministry reported in an official media statement that the VAT fraudsters had also been planning to import a test quantity of 25 metric tons of sugar containing toxic elements from the region of Chernobyl in Ukraine, the home town of the busted nuclear power plant.

In the event that it could be sold successfully in Bulgaria, the group planned to set up permanent imports of toxic sugar.

If the sugar proved to be of poor quality it would be used for the production of natural juice, which is also one of Ganchev's businesses.

Ganchev has dismissed as speculations claims of the Interior concerning the involvement of people from the company in VAT draining schemes.

Ganchev is one of the biggest sugar importers in the country and owns four out of a total of six sugar refineries in Bulgaria.

The plants are located in Ruse, Sofia, Burgas and Dolna Mitropolia.