Unregulated discount lure consumers to purchase liquor beyond their consuming capacity: Delhi Govt in HC
Mar 04, 2022
New Delhi [India], March 4 : The Delhi government on Friday said that the intent of the government to allow discounting was not being fulfilled by the licensees and the unregulated discounting was leading to luring consumers to purchase liquor beyond their consuming capacity.
Delhi Government in its affidavit filed in Delhi High Court further stated that there is a possibility of hoarding and future black marketing cannot be ruled out in the instant case. Further, according to the revealed data on the sale in the month of February vis-a-vis the sale of December, there is a huge jump in the cases sold by the L-7Z licensees, the Delhi government said.
However, the consumption rate could not have increased so fast as the number of people consuming liquor cannot increase manifold immediately and it was due to the discounting factor that people started buying liquor in bulk and irresponsibly. There was no intent on the part of the Government to make discounting a tool of encouraging unhealthy competition and distortions in the market, stated the Delhi Government affidavit.
The affidavit also states that the licensees have misconceived the discounting clause and have started giving freebies to the consumer in form of offers being floated to achieve short term monetary gains while compromising the ill effects of heavy drinking and consumption of liquor. Ensuring responsible drinking and also prohibiting the illicit trade of liquor is the primary objective of the Delhi government.
On the last date of hearing the Bench of Justice V Kameshwar Rao had issued notice to the Government of NCT Delhi over the petitions moved by several liquor vendors challenging order by which the Excise Department of the national capital, has prohibited the issuance or grant of discounts, rebate, concessions by the retail licensees on alcohol brands in view of reports of overcrowding outside vends and the existing threat of COVID-19.
Earlier, lawyers appeared for petitioners submitted that vendors here are valid L 7Z license holders stated that in June 2021, the Delhi government has approved the new Delhi Excise policy for 2021-2022 and the policy and the tender expressly permit grant of discounts by the retail licensees. Clause 4.1.9 (viii) of the policy in its last line states "The licensee is free to give concession, rebate or discount on the MRP."
Similarly, Clause 3.5 .1 of the tender in its last line stated, "The licensee is free to give concession, rebate or discount on the MRP", the plea stated. Advocates Sanjay Abbot, Tanmaya Mehta and Honey Uppal for the petitioner stated that the actions of the respondent are arbitrary, manifestly, arbitrary, disproportionate, discriminatory and violative of the petitioner's fundamental rights under Article 14 of the Constitution of India. And no opportunity of being heard was given before withdrawing commercial clauses having an impact on the civil rights of licensees. There has been a total breach of natural justice, said the petition.
The impugned decision of the respondent completely takes away the petitioner's right to make business decisions with regards to discounts, concessions, rebates which the petitioners were otherwise empowered to take under the new Excise policy and tender documents. 'Clauses' such as giving discounts formed an essential part of the new Excise policy scheme.
Hence, the impugned to discontinue or withdraw an important clause is in complete contradiction to the letter and spirit of the Excise Policy, the plea added. Further, the decision of the respondent of passing the impugned order after taking huge license fees leaves the petitioners high and dry because the petitioners had decided to participate in the bidding process only after relying on the clauses of the tender.
Therefore, prohibition of discounts contrary to clauses of the tender and of the excise policy amounts to impermissibly changing the essential nature of the policy by the respondent and it would cause huge losses to the petitioners, the plea read.
