The alcoholic beverage industry has requested the intervention of the Delhi government for the removal of leftover stock of around 70 lakh unsold liquor bottles – a situation brought on by the switch of excise policy.
The Confederation of Indian Alcoholic Beverage Companies (CIABC) has written to the excise department of the Delhi government for urgent attention to the disposal of the unsold supplies.
The Delhi government had enacted the 2021-22 excise tax policy on November 17, 2021, which ended the government’s near-absolute monopoly on liquor sales, opening the tightly-guarded revenue stream to private players, leaving the city for saw the opening of the enthusiast for a short period. liquor stores.
This policy was repealed in July after the lieutenant governor recommended a CBI investigation into its implementation, accusing the government of committing irregularities.
The old excise policy, operational before November 17, 2021, has been reduced from September 1.
“The issue of the remaining inventories in corporate L1 warehouses as of November 17, 2021, when the policy was changed, has yet to be resolved.
“The excise department had allowed companies to transfer these shares to their new L1 licensees, but despite this assurance, no permission was granted to sell them,” said Vinod Giri, director general of CIABC.
“Both remaining stocks are due in part to the fact that the companies at both policy shifts have heeded the government’s call to ensure adequate product supplies during the transition periods and so it is only fair that the government gives priority to addressing this issue. resolves,” Mr Giri said in his letter to the Excise Commissioner.
A senior Delhi government official said the case was pending and no decision had yet been made on the remaining stock.
“The stock was about 70 lakh bottles of spirits. The Excise Department was found to be in favor of selling stock brands of liquor registered under the excise policy introduced from September 1.
“A decision has yet to be made about the stock of those brands that have not yet been re-registered,” the officer said.
If the stock is not allowed to be sold, it must be destroyed, as liquor cannot be sold without a legitimate license, officials said.
The CIABC said that under the policy effective from September 1, 2022, the brand licensing fee is Rs 25 lakh and beyond per brand per year for Indian-made whiskey brands, while under the policy in effect before that, it was only Rs 1 lakh.
The brand license fees that are intended for a whole year are charged in total, despite the fact that there are less than seven months left in this excise year.
“Many brands, especially in the premium and niche segments where volumes are low, cannot expect these high fees and are therefore forced not to re-register. This has resulted in unsold stocks of these brands being on the market on 1 Sep 2022.” said Mr Giri.
He also referred to a provision that gives licensees a period of 15 days to sell these inventories, with a further extension of another 15 days.
Mr Giri urged the government to allow licensees to sell the remaining stock for at least two months or until stocks run out.
The excise duty that will be paid on these stocks will contribute to government revenues and help manage the shortage of premium spirits in the city, Mr Giri argued.
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