Excise department issues notice to DSOI Palam Vihar over lack of liquor licence

Following the notice, the club has suspended liquor service with immediate effect and informed its members that only non-alcoholic beverages will be served until the matter is resolved, the people cited above said.

The Haryana government’s excise department has issued a show-cause notice to the Defence Services Officers’ Institute (DSOI) in Palam Vihar seeking an explanation within three days for the alleged unauthorised serving of liquor without a valid licence, officials said on Thursday.

The Defence Services Officers’ Institute (DSOI) located at Sector 23 in Palam Vihar in Gurugram. (Parveen Kumar/HT)

Following the notice, the club has suspended liquor service with immediate effect and informed its members that only non-alcoholic beverages will be served until the matter is resolved, the people cited above said.

Officials said the notice under the Haryana Excise Act was issued after it came to the department’s attention after an HT report that liquor was being served at the bar at DSOI without the mandatory L-12C licence.

“We have served a notice to the club secretary and asked for a reply within three days explaining why liquor was served without authorisation,” said Ashok Panchal, deputy excise and taxation commissioner (DETC), West. “DSOI will have to apply for an L-12C licence as per the excise policy. Further action will be decided after examining their response.”

Under the current excise policy (2025–27), the L-12C licence applies to districts with metropolitan development authorities. Officials said the licence fee for such clubs in Gurugram is ₹42 lakh for the policy period.

In cases where an L-12C licence is granted to an army-sponsored club defence members may utilise liquor procured through their Canteen Stores Department (CSD) quota, while civilian members are not entitled to CSD-supplied liquor. For such army-sponsored clubs, the licence fee is ₹10 lakh for the policy period, officials added. Other applicable taxes would be levied separately.

A senior excise official, asking not to be identified, said that the issue pertains to compliance with the excise policy, irrespective of the institution’s character.

“This is about entry into the licensing framework. Once licensed, other taxes and conditions apply. Any dispensation, if available, is governed strictly by policy,” the official said, adding that non-compliance could have wider implications given the presence of similar institutions across the country.

A club official, requesting anonymity as he was not authorised to speak to the media, said DSOI Palam Vihar was established in 2007 as a repository of the Defence Services Officers Welfare Fund (DSOWF) to serve the welfare needs of serving and retired tri-services officers and their families in Gurugram. “The institute was built using DSOWF funds on land leased by HUDA (now HSVP) and has long functioned as a welfare-oriented, non-commercial space for defence families,” he said, adding that similar defence institutes operate pan-India with certain dispensations as a mark of gratitude for service personnel.

However, excise officials maintained that welfare status does not exempt an establishment from licensing requirements if liquor is served. The department said it will decide the next course of action after the club submits its reply within the stipulated time.

The complainant, Supreme Court advocate Rajeev Yadav, said that liquor would be cheap now in DSOI because profit won’t be charged, they charge 10% profit on it. “While private clubs, hotels and bars are compelled to pay hefty excise licence fees and VAT, Defence Clubs and Messes have been allegedly running unauthorised bars by procuring liquor in bulk from the Canteen Stores Department (CSD)—without any licence or tax compliance,” he said.