State excise department may lose Rs 5,000 crore when city pubs close
- The state excise department, which makes Rs 500 to Rs 600 crore in licence fee may incur a loss of Rs 50 to Rs 100 crore as pubs' licences haven't been renewed.
- The department said they will renew licences if pubs relocate but lack of space and confusion over what constitute a highway is bothering pub owners.
- The state government is sending a team to convince the Centre that highways within city should be denotified,
- However, closure notices have already been sent to various pubs in the city
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The state excise department is looking at a loss of Rs 5,000 crore in revenue for the year 2017. This dip in profits is due to the closure of city’s pubs from July 1 following a Supreme Court order. The directive states that liquor cannot be served within 500 metres of a highway.
The department had a target of Rs 18,050 crore for 2017. It expected to earn Rs 7,220 crore from Bengaluru alone. However, the department may now experience a revenue loss of Rs 5,000 crore.
The excise department’s losses also result from its refusal to renew licences. Excise commissioner Rajendra Prasad said Rs 500 to Rs 600 crore is earned through licence fee alone. With the closure of pubs and a hiatus on licence renewal, the department stands to lose Rs 500 to Rs 100 crore.
Officials in the excise department say that they are instructed to shut down pubs serving alcohol near the highway. A few days ago, closure notices were sent to pubs. The department’s directive noted, “The relaxation (under Karnataka Excise Act) that liquor could be served in these areas given that they are within the city and have a population of more than 20,000 has also been struck down,” according to Times of India.
This means that pubs on MG Road, Brigade Road, Church Street, Indiranagar and some areas near Hosur Road will pull down its shutters on July 1. These pubs could have their license renewed if they relocate to places far away from the six highways in Bengaluru.
However, lack of space and confusion over what is a highway is adding to the worries of pub owners in Bengaluru. “We are in talks with NHAI and the state government. We hope to remain operational,” Times of India quoted a general manager of a five-star hotel as saying.
On its part, the state government is sending a team to convince the Centre that the highways should be denotified. According to sources, the Chief Minister has sought legal options to file a review petition in Supreme Court. The government may make this move if the Centre refuses to denotify highways.
However, G Honnagiri Gowda, President of Karnataka Wine Merchants' Association said they will approach the court if the state government isn’t successful in representing its case to the Centre.
“We feel we are not being represented correctly. If no solution emerges, we will approach the court, explaining how these stretches of the roads are not highways and the ban around them must be relaxed,” Gowda said.
