UT yet to recover R50 lakh ground rent from 10 closed liquor vends | chandigarh | Hindustan Times
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UT yet to recover R50 lakh ground rent from 10 closed liquor vends

chandigarh Updated: Jun 22, 2013 15:27 IST
Vinod Kumar
Vinod Kumar
Hindustan Times
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The UT excise and taxation department is yet to recover Rs 50 lakh as ground rent from the owners of 10 liquor vends that were operating from pre-fabricated structures on roadsides.

There were 28 such liquor vends in the city until they were forced to close shop on May 1 this year on the directions of the Punjab and Haryana high court (HC), which were issued in 2012. While owners of 18 of the liquor vends have paid the rent, the remaining 10 are yet to pay some or all installments of the nearly Rs 70,000-a-month rent to the UT.

UT assistant excise and taxation commissioner Naresh Dubey confirmed this: "Notices have been issued to all the defaulters. We will ensure that the outstanding rent is recovered."

The HC direction on liquor vends functioning from pre-fabricated structures had come as a blow to the UT administration. Pre-fabricated vends have been a major source of revenue and with the decision of their closure, the department is expected to lose around Rs 80 crore in revenue.

Last year, the site for a pre-fabricated vend in Sector 52 had fetched a bid of whopping Rs 4.25 crore against the reserved price of Rs 3.3 crore. Another such site at Behlana village was also auctioned for Rs 4.25 crore.

The land for the pre-fabricated structures was provided by the UT engineering department on the roadside near roundabouts and red lights in various sectors of the city, which was earmarked for future expansion of roads.

The court, in its judgment, had observed that the UT administration had not floated a scheme under its excise policy to reserve a specific market for liquor vends. Therefore, the court ruled, allotment of the land to successful bidders of liquor vends by private negotiation was in violation of Section 3 of the Excise Act and also in violation of Article 14 of the Constitution.

Closure of vends operating from pre-fabricated structures and the hike in excise duty and other taxes have hit liquor business this year.

Of the 217 vends put under the hammer on April 23, only 103 were sold. The second auction on April 30 attracted only 21 buyers, while only 12 vends were sold in the third auction on May 14.

The fourth auction for the remaining liquor vends on May 29 again evoked poor response - only six vends were sold. Now, the department plans to auction the liquor vends for the fifth time -a first because the department has never conducted more than three auctions.

For attracting bidders, the department had reduced the reserve price by 5%. Interestingly, pre-fabricated vends are galore in Panchkula and SAS Nagar. Sources say these vends will affect the sale of liquor shops on the borders of Panchkula and SAS Nagar.

The Union ministry of home affairs (MHA) had recently asked the UT administration to explain the reasons behind exorbitant excise duty hike. This year, excise duty had been hiked from 20% to 300% and the assessment fee by 33%. The new excise policy came into effect from May 1. Explaining the reasons for the steep hike to MHA, the authorities said they wanted to bring the price of liquor on a par with Punjab.