while it is usually a term to describe a particular bad liquor and in most cases home made. There is actually a brand named that way.
The alcoholic distillate made at the Union Felon Penal Colony 23 by a Warden authorized distillery on the far south tip of the man's continent. The distillery survived the Yellow Throat Shiss Raid that killed almost everyone.
After the Shiss raid, an inspection team of the Department of Corrections assessed the Colony and it was closed as a Penal Colony and the survivors transferred to Penal Colony 24. However of the surviving long term inmates 275 were allowed to stay, as they considered the planet their home and volunteered to remain on the planet for the rest of their lives.
They founded the Rut Gut Whiskey company and pride themselves to make the "worst" liquor in the Galaxy. Surprisingly enough it made its way on the Galactic Market and is sold in small quantity but at a steady demand.