Delhi govt has power to implement its new excise policy, says high court

The court, while hearing an application by an L7 licence holder — Rattan Singh — asking for a stay on the closure of 260 retail vends with L7 and L10 licenses out of 849 private vends, said “change is inevitable” and the new excise policy is no exception to this rule.

Observing that the state government has the power, jurisdiction and authority to float a new excise policy, the Delhi high court on Wednesday refused to stay the closure of retail vends with L7 licenses, which are valid till September 30.

Delhi has 849 liquor stores, of which 276 are privately run. The rest are run by the Delhi government. (Sonu Mehta/HT archive)

“Prima facie, the respondent (Delhi government) has all the powers and jurisdiction to float a new excise policy under the Delhi Excise Act, 2009 and its rules,” a bench of chief justice DN Patel and justice Jyoti Singh said.

The court, while hearing an application by an L7 licence holder — Rattan Singh — asking for a stay on the closure of 260 retail vends with L7 and L10 licenses out of 849 private vends, said “change is inevitable” and the new excise policy is no exception to this rule.

The application was part of a petition seeking to extend the license in parity with other categories under the provisions of the Delhi Excise Act. There are a total 35 categories of licenses for liquor traders.

“Something is being stopped so that new things are created in a systematic manner as per the policy. Whenever, any new policy comes, there is bound to be changes…It is never the intention of the government that 260 places in malls or commercial places, will be closed but they will be restarted as per new policy.

“Temporarily you may feel that you have been closed down but it’s a policy decision. Today you are closed down, but immediately somebody will open. The person may not be important, but the place is..,” the bench remarked during the hearing.

Delhi has 849 liquor stores, of which 276 are privately run. The rest are run by the Delhi government. The private vends have to shut shop from October 1 to ensure a smooth transition to the new excise regime, which kicks in from November 17.

The state government is trying to pave the way for a range of sweeping reforms to boost the city’s revenue, crack down on the liquor mafia and improve user experience under the new state excise policy.

The city has been divided into 32 zones and allotment of licenses is now being done on a zonal basis.

Only about 408 liquor vends in Delhi will be operational for 46 days starting Friday, as the city transitions to a new excise regime from November 17.

The court noted, “It ought to be kept in mind that change is inevitable. The excise policy is no exception to this rule. New experiments are always being permitted as a matter of a policy. Prima facie we do not want to prejudge the resultant effect of the new policy.”

The bench, in an interim order, said that the new mechanism did not violate any of the petitioner’s rights.

Senior counsels Abhishek Manu Singhvi and Rahul Mehra, appearing for the Delhi government, informed the court that with effect from November 16, even the government vends will shut, and so it is important that the transition to the new policy is “peaceful and harmonious”.

Supply shortage forces customers to Noida, Ggm

However, the closure of private liquor vends for 46 days from Friday, however, has led to a severe supply shortage in the city, with shelves in Delhi stores nearly empty, forcing customers to head to neighbouring Noida and Gurugram to procure their stock.

Animesh Sinha, a resident of Ashok Vihar Phase 4 in North Delhi, wrapped up his work early at around 5pm on Wednesday so he could go to Madhushala, a private liquor vend in the area, to stock up for the next few weeks. On reaching the shop, he was welcomed by a board stuck on the store’s shutter that read “permanently closed”. “This is heartbreaking. This shop was just walking distance from my house. It has been my go-to place for buying alcohol for about five years now,” he said.

The ongoing transition phase has also forced manufacturers to postpone their supply schedules. For instance, American spirits major Brown-Forman, the maker of popular liquor brand Jack Daniel’s, has pushed the Delhi launch of its new Tennessee Apple flavoured whiskey by about three months.

“We launched Jack Daniel’s Tennessee Apple in Gurugram last month... But, we will be able to launch the product in the Delhi market only by late November or early December, once the city’s new excise policy comes into effect and new retail stores become operational,” said Siddharth Wadia, Director and general manager, IMENA, Brown-Forman.

(With inputs from Sweta Goswami)