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Delhi High Court to hear plea of liquor traders against Delhi govt’s New Excise Policy 2021

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The Delhi High Court will on Thursday take up the petition filed by liquor traders, challenging the New Excise Policy for year 2021-22, announced by the Delhi Government in June this year. 

The plea has been filed by the Delhi Liquor Traders Association, an unregistered body of 143 liquor traders in Delhi, through Kashish Electricity Services Pvt Ltd, a private limited company having a retail liquor vend in Delhi and one Harish Chauhan, a retail liquor vendor.

The petitioners, through Advocates Arvind Bhatt and Siddharth Sharma, held retail/wholesale licences issued by the Excise Commissioner in accordance with the Delhi Excise Act, 2009. 

The plea contended that the Delhi Government constituted a committee of Group of Ministers (GoM) under the Chairmanship of Deputy Chief Minister Manish Sisodia, and comprising Ministers Kailash Gehlot and Satyendra Jain, to finalize a new excise policy for Delhi for the year 2021-22. The GoM made an announcement on March 22, 2021 on formulation of new excise policy. Pursuant to the report, the new Excise Policy was introduced by the Delhi Government in June this year; however, the policy was released in public domain on July 5, 2021, after direction of the Court.

On June 28, the Delhi Government floated a tender, inviting e-bids for grant of 32 zonal retail licenses for the year 2021-22 through e-tendering process in the form of L-7Z/L-7V for sale of Indian and Foreign Liquor in the region of NCT of Delhi, on the basis of the newly approved policy. The tender regime, however, failed to publish criteria for fixation of maximum retail price.  

The plea averred that the policy facilitated monopolistic cartel, while debarring the non-super-rich from entering into the competition. It enabled the licensee to recover taxes from the public and non-payment of the same to the Government. “Taxing is an essential legislative function. It cannot be delegated to its subordinate (executive). Excise Commissioner not empowered under the Act to impose fresh tax,” it added.

Also Read: Feel ‘ashamed’ over esteemed High Court not being able to render justice due to connectivity issues: Justice Sabyasachi Bhattacharyya

The plea sought quashing of the New Excise Policy as being ultravires of Article 14 of the Constitution, and a direction to the Delhi Government to frame an Excise Policy in compliance with law, so as to prevent monopoly and cartelization. Till such policy is formulated, the plea sought direction for continuation of existing L-7/L-1 licences issued by the Excise Commissioner. In addition, the plea also sought quashing of tender dated June 28, including all consequential action taken in furtherance of the said tender.

Furthermore, the plea is seeking a declaration that the sovereign right to collect taxes cannot be auctioned by a State by way of the new excise policy. 

The Single-Judge Bench of Justice Rekha Palli of Delhi High Court, on July 5, had discarded the plea by Delhi Liquor Traders Association, seeking direction to make the New Excise Policy for the year 2021-22 available in public domain, after the Government undertook to upload the said policy on the website by the end of that day.

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