Following the easing of some lockdown restrictions, the most striking images in the news have been of long queues outside liquor shops. State excise duty on alcohol being among the largest contributors to the tax revenue of states, it is undeniable that the sale of liquor is fundamental to the financial health of state governments.
An analysis of the template being followed in Delhi demonstrates that allowing home delivery of liquor is a better way to ensure social distancing — as opposed to following the present framework of restricting sales by exclusively permitting only neighbourhood stores, imposing limits by prescribing time, and increasing taxation —which will inevitably encourage ‘arbitrage’, once inter-state movement resumes.
The Problem With Allowing Only Stand-Alone Shops to Sell Alcohol
The Excise Department of the Delhi Government has allowed the sale of liquor by passing the order dated 3 May 2020. The order permits liquor licensees running stand-alone and neighbourhood stores to resume operations from 7 AM to 6:30 PM. It may be worth noting that owing to political, and societal resistance — most ‘thekas’ are, in fact, not situated in neighbourhoods. By continuing to ban the liquor shops situated in market complexes, not only does the order severely put pressure on a few stand-alone shops — but also unfairly ignores the fact that such neighbourhood shops are often smaller, and hence, inadequately equipped to undertake the requisite social distancing measures.
Further, the decision to impose a time limitation is also inadequate, in as much as it fails to take into account that last-minute rush by office-goers will prove to be a significant challenge to lockdown management and physical distancing amid coronavirus.
By an order dated 4 May 2020, the Delhi Government further sought to impose a 70 percent additional tax on the sale of liquor, under the head ‘Special Corona Fee’. Given that this will lead to widespread disparity in prices across borders, the decision is likely to encourage ‘arbitrage’, as consumers may look to flock to other states in the National Capital Region, once inter-state movement is fully resumed.
Perks of Developing Online Market-Place for Liquor Vends
The need to generate revenue, has to be balanced against the object of ensuring the success of social distancing measures. The easiest way to ensure the safety of consumers and retailers is to permit liquor stores to deliver alcohol to the doorstep. This can be done by allowing licensed vends to accept orders on the phone, and further by permitting them to register at an online platform, where such deliveries can be facilitated. A market-place model can be created, where delivery can be facilitated, upon age verification. Government can regulate the amount delivered, or control its frequency—and provide Curfew passes, to enable the movement of delivery agents.
Roadmap for Allowing Home Delivery
At the outset, it is important to note that selling or buying liquor online, is considered to be an offence under the Delhi Excise Act, 2009, and the Delhi Excise Rules 2010. Rule 32 therein, enumerates the various classes for which a license can be issued; and Rule 33 provides the classes of permits. Neither of them explicitly contemplate the award of a license which extends to online sale.
The first interpretation of the written word will therefore, suggest that there is a need to amend the Delhi Excise Act, 2009, or the Rules therein — to provide for the creation of such a home delivery-based model. The government has, however, previously asserted that there is no need for an amendment, and that enabling provisions to permit online sale, in fact, already exist.
How Delhi Govt Can Navigate Laws for Home Delivery of Liquor
A closer look at the licensing mechanism suggests that there is no bar on an individual, to either consumer, or serve liquor at his residence. The only roadblock, therefore, is the process of delivery.
There can be some logic in treating the process of delivery to be on par, with say, the grant of a ‘P-10’ license which allows temporary service of liquor — so long as it is procured from an authorised source in Delhi, is served to adults above 25 years of age, and served in an area which is screened off from public view.
The Delhi government can invoke its powers under the provisions of The Epidemic Diseases Act, 1897, and The Delhi Epidemic Diseases, COVID-19 Regulations, 2020.
Political Optics of Liquor Home Delivery Could Be Disastrous – But There’s a Silver Lining
The optics of facilitating home delivery can be politically disastrous. But it is important to note that the resultant transparency in the process of consumption, will, in fact, help the masses.
The pandemic-induced lockdown has given the state an opportunity to develop a more wholesome approach, which can achieve the twin objects of achieving revenue targets, and maintaining social distancing — in the least restrictive way possible.
(The author is an advocate, and practises before various courts and tribunals in Delhi. He can be reached over e-mail at firstname.lastname@example.org, and on Twitter at @GSansanwal. This is an opinion piece, and the views expressed are the author’s own. The Quint neither endorses nor is responsible for them.)