The Hindu : Andhra Pradesh News : Agonising wait for liquor outlet applicants

Online edition of India's National Newspaper
Tuesday, Mar 22, 2005

Andhra Pradesh

Andhra Pradesh

Agonising wait for liquor outlet applicants

By R. Jagadeeswara Rao

SRIKAKULAM, MARCH 21. Nearly 7,300 applicants who wanted to make a fast buck by opening bars have been sitting with their fingers crossed, with no knowledge of what is in store for them.

These applicants are the persons who have applied for licence for opening bars under the new excise policy. Each had paid a non-refundable deposit of Rs. 5,000 per shop and a deposit, in the form of DD, of one third of annual licence fee which varied from shop to shop.

The maximum annual fee, which is decided according to the population of the town or village, in the district is Rs. 8.25 lakhs (this is for Srikakulam town).

According to officials nearly Rs. 85 crores which had been paid by the applicants in the district had been locked up in the treasury for over a month.

Selection process

According to the new excise policy, licence for opening a bar would be given for every town or village with a population of more than 25,000 and selection of licensees would be made through draw of lots.

There are more than 7,300 applications for the 250-odd bars for which licence could be granted in the district.

The irony is that most of the applicants had borrowed the amount at exorbitant interest rates.

The logic was: If they get the licence in the lots it is good, if they fail to get the licence, they would lose only the non-refundable deposit of Rs. 5,000 for which they are prepared, but would get back the one third annual licence fee.

Stay order obtained

The last date for submitting application for licence was February 18 and it was expected that within a week licences would be finalised by draw of lots.

Now the licence fees running into Rs. 85 crores had been locked up.

The DDs were lying idle because the Government could not encash them without finalising the licensees. Previous owners of bars went to court and obtained a stay order.

The result was, draw of lots had to be suspended till a final judgement is passed.

Now the excise office here is flooded with phone calls and enquiries as to the fate of the issue.

Some were requesting for the return of the one third annual fee, stating that they are prepared to forfeit the non-refundable amount of Rs. 5,000, because of fear of their interest getting compounded.

But officials expressed their inability to return the DDs because rules do not permit such a step.

It is a case of paying in haste and rueing in leisure, commented a senior official of the Excise Department here.

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