24-03-2021: Jammu Chamber of Commerce & Industry urged the government to protect and safeguard the interests of the JKEL-2 license holders while implementing the Excise Policy 2021-22. These licenses should continue to be renewed on terms of the Jammu and Kashmir Liquor License and Sale Rules, 1984 governed by the J&K Excise Act SVT 1958.
The Chamber President Sh. Arun Gupta said that recent Draft Policy 2021-22 published has been framed totally in conflict with J&K Excise act SVAT-1958 as amended and finance department notification under SRO 679 dated 13-12-1984, as amended till date. It is a settled position of law as elaborated in related judgment of Hon’ble High Court dated 28-12-2020, that no policy can supersede act and rules for regulations in any trade. Act and Rules are crystal clear and defining these JKEL-2 license holders as a separate class is licensees on fixed fees i.e regular licensees.
The basic structure of grant and renewal of JKEL-2 license has been changed in the new draft policy for JKEL-2 trade through e-auction mode. While hon’ble high court judgment dated 28-12-2020 clearly provided for framing of policy strictly in accordance with act and rules. The draft excise policy is not only in violation of the Excise Act and rules but is also in total disregard to the judgment of the Hon’ble High Court. The Hon’ble High Court Judgement in terms of para90(vii) clearly states that for the purpose of renewal of licenses for trade in liquor, if permissible in law, all conditions applicable for grant of new license shall also be applicable. This does not mean that renewal of the earlier license is also to be done by way of auction. The licenses which have been granted by way of fixed fee per annum and are in operations for the last more than 5-6 decades are a class apart. In terms of rule 35 which clearly envisages a provision that government can grant a license in any other manner. This provision has to be read in reference to rule 4, as well as the other relevant rules with respect to the grant of license by way of renewal. The grant of license is a well-recognized condition which is permissible under law and a number of courts have upheld the policy decision of the government by the way for which licensees already in existence on a fixed fee as a separate class apart.
It is not understood, why normative practice is not being adopted for trader involved in liquor who has served the department with his sweat and blood and is tested ground level worker of the department and has never defaulted on account of any type of dues and binding imposed by department prescribed in section 22 of the act. The renewal is very much permissible under law but shockingly the government has not dealt with said issues which are a well-established policy in different states.
We have strong reservations about the issues proposed in the draft policy. It has also been proposed that no obviate possibility of cartelization and monopolistic approach allotment is made to only one bidder. We may bring on record that most regular licensee are having one license and are earning bread and butter for their families as the only source of livelihood. All of them are working with sincerity, accountability, and honesty and serving as a collection agent of the government.
E-auction individual will be granted a license at only one location but the persons having muscle and money power will bid in name of all of their family members and also bid in name of proxies, who will be paid a meager amount for the required purpose. The fact remains e-auction will bring big players and shall lead to cartelization and a monopolistic approach.
Auction has been tested earlier in the year 2000 with the country liquor in the erstwhile state of J&K and results are well known with the department. A related case and FIR, losses incurred on account of that amounting Rs. 100 crores are still pending adjudication. It is to bring on record that ever since accord of license, they have never defaulted on account of dues and persistently helping the department in achieving its objectives besides helping to increase the revenue.
We request the government that no systematic change be brought in the grant of renewal of the license of JKEL-2 Regular/Fixed Licensees which are a separate class, contrary to the excise act and rules against the spirit of the law. These may be allowed to run their licensed premises on fixed fees as per approved blueprints plans available with the department and same locations notified in draft policy in a normative manner as per spirit of Hon’ble High Court order and settled position of law. JKEL-2 fixed licensee be renewed as per rules position and settled principle of law. The aforesaid draft excise policy to the extent of the JKEL-2 Regular / Fixed Licensee shall not be acted upon, as it is in disregard to the judgment of the Hon’ble High Court.