HC asks retail liquor dealers to pay licence fee under New Excise Policy

The Delhi High Court Thursday asked retail liquor dealers to pay licence fees to the AAP government under the new Excise Policy from December 1, as the state has already registered over 500 liquor brands with their MRPs fixed.

The high court further directed the dealers to deposit 75 per cent of the amount of licence fee from November 17, the date when they were scheduled to commence business under the new policy, to November 30.

Keeping in view that today a number of liquor brands stand registered, there is no reason as to why the petitioners (retail liquor dealers) could not commence payment of licence fee. They agree to pay the licence fee with effect from December 1, 2021.

I am of the view that equities can be balanced by directing the petitioners to deposit 75 per cent amount of licence fee from November 17 to November 30 this amount will be subject to the outcome of the pending writ petitioners, Justice Rekha Palli said.

The court was hearing pleas by several retail liquor traders seeking to restrain the government from demanding the sums of money in the form of licence fees or security deposit and also to direct the authorities not to levy or demand licence fees from the successful bidders until the government performs its own obligations under the tender terms and conditions and the Delhi Excise policy 2021-2022.

The court disposed off the applications for interim reliefs.

The petitioners said they are successful bidders for licences for operation of retail liquor vends and sought to declare the decision of the Delhi government to levy licence fees with effect from November 1, 2021 as illegal.

On November 9, the high court had asked the Delhi government to inform it about the number of liquor brands where MRPs are fixed and those yet to be done under the Delhi Excise Policy 2021-22.

On November 11, the Delhi government had orally assured the court that no coercive action would be taken against liquor retailers for the time being for not paying the licence fees.

During the hearing, senior advocate Abhishek Manu Singhvi and Rahul Mehra, representing the Delhi government, said out of 1,171 brands, as of now 519 brands have been registered with their MRPs fixed and contended that no case is made out even for continuation of the interim order.

The counsel argued that the bidders cannot turn around now and find fault with the implementation of policy on technical grounds and now that majority of brands have been registered, there is no ground to continue the interim order.

Senior advocate Maninder Singh and lawyer Tanmaya Mehta, representing the liquor retailers, said even though they had earlier agreed to pay the licence fee, it was subject to the Delhi government fulfilling its commitment under the new Excise Policy.

He said though the policy has been brought into effect, the authorities failed to register brands in a time bound manner and that there were hardly any brands available for sale.

The petitioners are successful bidders of L-7Z (zonal licence for retail vend of Indian liquor and foreign liquor) and L-7V (retail vend of Indian liquor, foreign liquor in a zone).

One of the plea filed by 15 retailers, through advocates Sanjay Abbot and Ankit Agarwal, said there has been a great delay in initiating the process of registration of brands and fixation of MRP by the Delhi Government under the 2021-22 policy.

It claimed that until October 30, not even a single brand had been registered within Delhi under the new excise policy, nor had the MRP been fixed or determined under the new policy.

It said the process from determination of MRP to retail sale is a time-consuming exercise and if the scheduled date of commencement of business is November 17, being specified by the government, it is a complete breach of obligations on the part of the authorities in delaying the registration of brands and determination of MRP.

Several petitions are pending before the high court against the New Excise Policy on the ground that it is illegal, unfair, arbitrary and violative of the Delhi Excise Act, 2009.

In July, the court had refused to stay the new Excise Policy on one of the petitions which contended that the new regime would lead to complete monopoly of the few big players.

The Delhi government, also represented through standing counsel Santosh Kumar Tripathi, has defended its New Excise Policy 2021, saying that the new regime would generate optimum revenue and ensure ease of doing business while eliminating cartelisation, proxy players and monopoly.