In this article, Ayushi Sunder discusses how to get a license to set up a liquor store in Noida. 

INTRODUCTION

Licensing of liquor, in general, refers to legal authorisation of sale and/or consumption of liquor quantities. However, on a closer look, one can identify the intricacies involved in this domain. Not only the licensing authority enshrines specific laws relating to issuance, suspension and cancellation of licenses that are exclusive to every state but the license itself is not general in its application but is highly context specific in its purpose. There exist licenses for:

• Setting up of liquor business
• Payment of duties
• Installing new stores
• Consumption of large quantities of alcohol in a private party

The aim of these licenses is to keep alcohol sale/consumption under check and mandates government approval in this regard to ensure strict monitoring.

THE LEGAL PROCESS

AWARD, ISSUE AND CANCELLATION OF LICENCES

• Licenses for wholesale and retail vend of intoxicant are to be granted for excise year, extending from April 1 to March 31.
• In special cases, licensees may be given with the sanction of the Excise Commissioner for special period.
• In the event of loss of original license, a duplicate license can be issued for a fee of Re. 1

Persons to whom licences may be granted 

• To person approved as suitable vendors.
• Any person may be granted licence for vending country liquor or foreign liquor or both

Persons to whom licenses shall not be granted

• Persons who have been convicted by a criminal court of a non-bilabial offence;
• Former licensees who are in arrears to Government, or whose conduct has been found to be unsatisfactory, or who have been found guilty of any serious breach of the condition of their licences
• Persons below the age of eighteen years
• S. 34 and 35 provide for cancellation of licenses and grants the authority to cancel the license of any shop. However, in case it is desired that license may be continued, then it can be resettled under para 357, 359 and 375.
• It is required by the holder of license for vend of intoxicant, that upon termination of license, he reports the remaining stock in his possession, to the collector. It is for the collector to prescribe the time limit within which the vendor shall dispose of his remaining stock.
• Any intoxicant that, detected on the premises of the vendor, is found unfit for human consumption, shall be destroyed in accordance with the orders of the collector.

THE UTTAR PRADESH EXCISE LICENCE (TENDER-CUM-AUCTION) RULES, 1991

• These rules apply and regulate the grant of licenses for sale of country liquor and foreign liquor under tender cum auction methodology.
• A licence for retail sale of country liquor or foreign liquor shall be settled by tender-cum-auction system subject to the payment of bid -money for the shop or group of shops as consideration under section 30.
• Settlement of licenses can be for lesser periods.
• The licences will be granted in Form F.L. 5-A for retail sale of foreign liquor.
• The power to fix number of shops and groups of shops shall lie with the Licensing authority.
• The settlement of shops is to be made on date that is published under proclamation of auction issued by Excise commissioner in Form G-35-D.
• The date and the time and place of auction, so fixed shall be notified by the Excise Commissioner in prominent newspapers to ensure effective communication.

Following are the requirements that need to be satisfied in order to be eligible to bid:

• Production of Solvency certificate
• Inclusion of name in consolidated list of solvency certificate holders
• He shall not be a defaulter of excise revenue
• He shall not be debarred from bidding in auction
• Production of affidavit containing the particulars of his immovable and movable property along with the copies of documents of title to establish the ownership of property
• A prospective bidder from outside the State will be allowed to participate in the auction subject to his production of a certificate from the Collector of the district in which he resides certifying that he is not a person convicted by a criminal court of a non- bailable offence and that he is not in arrears of Government revenues.
• Excise Manual 374(4) – Before the auction proceedings for the day commence, the general conditions governing the auction shall be read out and explained to all present , so that competitors may clearly understand the conditions on which they bid.

Auction of shops

• The licensing of retail sale of country liquor, foreign liquor and Bhang shall be done in separate segments of auction. Auctioning of licences shall be shop-wise. The shops may be auctioned in form of groups as may be decided by the licensing authority.
• Submission of tenders-(1) The tender shall contain the following particulars and shall be submitted in a closed cover addressed to the Auctioning Authority:
  • Name of the tenderer or tenderers along with fathers name and address
  • Name of location of shop group or shops and kind of shops for which he has offered his tender
  • The basic licence fee, if any, for the shop or the group of shops in figures as well as in words

The tender shall be accompanied by the demand draft for a sum not less than ten percent of the entire sum offered including basic licence fee.

Auction procedure

• The auction shall be presided over by the Licensing Authority.
• Such proceedings shall be witnessed by the Excise Inspectors on Preventive Duty and by Tehsildar.
• The officer conducting the auction may withdraw any licence or licences from the auction before the auction is commenced under instructions of the Excise Commissioner along with reasons for such action.
• Bids shall not be accepted in amounts smaller than Rs. 100 upto Rs. 10,000 and all bids above Rs. 10,000 shall be accepted in multiples of Rs. 1,000.
• The name of the person making the bid and the amount bid shall be recorder by the officer conducting the auction.
• The signatures of the highest bidders along with this elf the two lowest bidders has to be obtained on the noise sheet.
• Once the tender submissions are over, it is for licensing authority to consider bids and take decisions regarding them. Once finalised, no further negotiations or auctions can be reopened by the authority.
• The final acceptance of any bid is subject to the sanction of Excise Commissioner which in its turn is subject to the decision of the State Government in appeal or revision, if any.
• Every bid shall be deemed valid till the excise commissioner declares his final decision.
• The license awarded in favour of auction purchaser shall take effect from April 1 and shall bind such purchaser to pay bid-money even though he might not have received the license.
• Minimum guaranteed quantity (to be lifted by auction purchase) shall be declared by excise commissioner, in auction proclamation.
• The licensee, apart from paying the bid-money is also required to pay the price of the intoxicants as fixed by Excise Commissioner or as prevalent at that time.
• It is for licensee to ensure that sale is organised within minimum guaranteed quantity of the intoxicant for the excise year, before the expiration of the term of licence. In case of any balance quantity left, the same shall be declared by the licensee to the Licensing Authority on the next day.
• In event of delay in the supplement of intoxicant, the licensee shall have no authority to claim damages or refund of bid-money. He cannot claim remission either.
• A list of all sanctioned shops that are potential to effectuate a settlement shall be sent, in form of G-33A, to excise commissioner with a proposal of action.
• For all settled shops, a statement has to be sent in form D-12 to excise commissioner within 30 days of auction and final decision shall be taken by him within a month’s time.

UTTAR PRADESH HOURS OF RETAIL SALE OF FOREIGN LIQUOR RULES, 1973

• As prescribed by aforementioned piece of legislation, the timings for a licensed shop shall be From 10.00 a.m. to 10.00 p.m. “off” the premises in accordance with F.L.5.
• A note is also appended towards the end stating that consumption of liquor by any person beyond half an hour after the closing hour, shall not be permitted under any given set of circumstances.

Conditions essential for maintenance of license

Following the procedure to obtain license does not put an end to the workload of the licensee. One has to ensure that all conditions essential for maintenance of license are met. For this purpose UP Excise Act, under s. 41, enshrines the general conditions that are to be observed after the issuance of license:

• No substance shall be mixed with liquor in an attempt to increase its intoxicating impact.
• The admixture with intoxicating drug of any other substance whatever by licensed drug vendors is strictly prohibited.
• Reducing the strength of spirit by licensed vendors (of foreign spirit vendors) is strictly prohibited.
• Licensed vendors be it wholesale or retail have to bear in mind that if the business is conducted under contract agreement, then they shall not diminish the strength of the liquor below prescribed limits.

Denatured alcohol, also called methylated spirits or denatured rectified spirit, is ethanol that has additives to make it poisonous, bad tasting, foul smelling or nauseating, to discourage recreational consumption’

• No licensed vendor shall sell denatured alcohol below a strength of 50 degrees.
• It is for a retail vendor to ensure that he is not in possession of denatured spirit that amounts to excess in accordance with the limits fixed by the collector.

• In the event of retail liquor shops lying on or near the march line, the shops shale closed if the marching of troops so requires. Such closing of shops has to be arranged by tehsildar.

The shops as aforementioned are inclusive of 

• Country spirit
• Tari
• Foreign liquor for consumption “on ” and “off” the premises
• Foreign liquor for “off ” the premises

It is to be ensured that such shops are not to be opened on,

• Republic day (January 26)
• Independence day (August 15)
• Gandhi Jayanti (October 2)
• The first day of every month
• Any other three days of a year as declared by the Collector in his district

In case of general or bye-elections being conducted in a territorial constituency, shops falling within the boundaries of such constituency or within a span of 8 km shall remain closed,

• On the day of the poll
• On two days immediately preceding the day of the poll.
• All wholesale and retail vendors are required to maintain daily account of the ordinary limit of retail.
• The collector may, if satisfied that representative of the deceased is fit to hold the deceased’s license, on the condition that any arrears due from the deceased licensee are recovered before the licence is so transferred, in the event of a licensee’s death, may continue the licence on the same terms to a representative of the deceased.
• Wholesale vendors of country spirit under the contract system shall maintain accounts in the form prescribed in their licenses and shall submit to the Collector on the first of each month a copy of the account so maintained.
• Retail vendors under the contract system shall maintain accounts in the form prescribed in their licenses.

LATEST VERSION

When it comes to nightlife and happening party scenes, in the NCR trio of Delhi-Gurgaon-Noida, the latter is often the less preferred place, partly due to safety issues and partly due to comparatively higher concentration of elite and party-loving masses of population in former two places.

• With issuance of liquor licenses to 5 popular and much-frequented eateries in Noida, the hangout and entertainment quotient of the city will soon witness a great boost.
• These licenses, issued in accordance with UP Excise Act permits serving of alcohol only from 12 noon to 12 midnight and allows the serving of ‘for sale in UP’ liquor only. Additionally, these permits tend to prohibit the sale of liquor that are marked for sale in areas that lie outside the prescribed territorial boundaries.
• April 1 witnessed the hike in licensing fee and duty on country-made alcohol, beer and Indian made Foreign Liquor (IMFL)in accordance with the new excise policy of the Uttar Pradesh Government, approved by the state cabinet.
• As per the amendments brought about, licensing fee on foreign liquor has been increased resulting in a hike of Rs26 per litre and the duty on cheap to premium category IMFL has not witnessed an increment technically but the premium to scotch categories has been raised by Rs 20 per litre.
• Another latest policy change brought in this regard is that bars in Noida and other municipal corporation areas are now permitted to serve alcohol till 1in night as against the older timing of serving till 12 midnight.

Liquor is a commodity that demands extreme care and caution in its dealings, be it sale or consumption. License is a government approval that keeps this controversial commodity under check. Hence, it is always recommendatory that license issuance and maintenance shall be adopted as regulatory mechanisms for it not only ensures the legality of the dealings but also maintains efficient transactions, which contributes to the smooth operation of commercial sector.