Excise dept to incur Rs 50 cr loss due to 33 unsold liquor vends

  • Vinod Kumar, Hindustan Times, Chandigarh
  • Updated: Sep 08, 2014 10:25 IST

With as many as 33 liquor vends still remaining unsold, the UT excise and taxation department will incur a loss of around Rs 50 crore on this account. The department has not received a single bid for the remaining vends put under hammer on August 29.

This year, the administration had decreased the number of retail sale vends from 217 to 173 vends out of which 119 were sold in the opening auction held on May 27 while 17 were sold during the second auction held on June 6.

Eight vends were sold in the third auction on July 19. Four contractors had surrendered their liquor vends.

Even in the last financial year, the department had suffered a loss of around Rs 60 crore after it failed to sell as many as 90 vends out of 217, despite repeated attempts. For attracting bidders, the department had even reduced the reserve price of vends by 30%.

The current excise policy announced on May 12 will remain in force for a period of 10 months, which is said to be one of the reasons behind these vends remaining unsold. Besides, the department’s failure to put a check on liquor being sold at rates below the maximum retail price (MRP) and increase in the number of vends in prominent areas are some of the other reasons for vends remaining unsold.

Satyapal, president Chandigarh Wine Merchant Association, said: “The department’s failure to check liquor being sold at rates below MRP is discouraging the liquor contractors from investing in the remaining vends.”

When contacted, UT assistant excise and taxation commissioner RC Bhalla said despite getting no response, they are planning to make another attempt to sell the remaining vends.

In the new policy, the Chandigarh administration increased the earnest money to be paid along with application by the traders. For vends up to Rs 60 lakh, the earnest money was increased from Rs 7 lakh to 10 lakh while in case of vends worth up to Rs 1 crore, the earnest money was enhanced from Rs 10 lakh to Rs 20 lakh.

Similarly, for vends above Rs 1 crore to Rs 1.5 crore, the earnest money saw a jump from Rs 13 lakh to Rs 30 lakh. For shops above Rs 1.5 crore to Rs 2.5 crore, the earnest money was increased from Rs 25 lakh to Rs 40 lakh.

Civic body fails to recover rent

The Municipal Corporation of Chandigarh has failed to recover rent to the tune of Rs 96 lakh for pre-fabricated sheds allotted to liquor vends in the city.

According to the audit report, rent of these liquor shops was fixed as Rs 15,000 in 2007, which was later revised to Rs 30,000 for liquor shops and Rs 25,000 for ‘ahatas’ in April 2010 but no rent deed/ agreement was executed in this connection.

No land was given for running the liquor vends after March 31, 2011. The municipal corporation failed to recover Rs 96 lakhs.

After the 2013-14 excise policy came into force, the administration was forced to remove the pre-fabricated structures on the directions of the Punjab and Haryana high court issued in 2012. There were a total of 28 pre-fabricated structures in the city, which were used as liquor vends on roadsides.

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