Liquor Laws In India

Every business comes with a set of challenges that requires an ample amount of planning and preparation in order to set it correctly. An Entrepreneur with a vision should always be bucked up to face high uncertainties of the internal and external environment that affect the business. Long working hours, financial management, and pressure are some of the complimentary stuff that comes handy to an entrepreneur. And believe us, when you decide to get into a business that involves Liquor, the challenges just keep on multiplying. Besides the regular norms and regulations of business, an entrepreneur has to abide by various drinking laws and compliances in order to start a liquor business in India. So here are the ground rules that need to be followed in case your business has any involvement of liquor in it.

Some Information Nuggets:

• You need to seek permission from your respective State Government in order to sell any form of Consumable Liquor.
• Alternatively, permission is also to be sought while selling or consume liquor at any other public place, wedding, or social gathering.
• Every state has its own set of rules and conditions that need to be followed in order to get the permission
• The excise department of each state grants different licenses for different types of liquor shops.
• Be prepared to pay a hefty amount as a bribe to different departments to expedite the process.

Why is the liquor license required?

A liquor license is a permit given by the state excise department to those who wish to sell alcoholic beverages at a certain place. It is unlawful for any person to manufacture, distribute, or selling toxic ting liquor without a state license issued by the state supervisor of the division alcohol and tobacco control. Therefore, to maintain the health and the state of peace & order in the country, there is a requirement to regulate the selling of liquor and hence a liquor license is necessary.

What are the liquor laws in India?

The constitution of India under Article 47 clearly directs the states to improve public health and in particular, bring about prohibition in the intoxicating drinks and drugs which are injurious to health. Apart from this, the subject of alcohol is included in the state list under the seventh schedule of the constitution of India. Thus, the law which governs the sale and consumption of alcohol varies from state to state. A person above the age of 21 years only can obtain a liquor license and the process to obtain such a license is quite long and challenging.

Types of liquor

There are two types of liquor available in the Indian market.

• Indian made foreign liquor (IMFL): It refers to ‘Hard Liquor’ manufactured in the country.
• Imported foreign liquor (IFL): This refers to the liquors which are produced outside of India and later on imported to India. IFL is usually expensive than IMFL.

Types of liquor license

Different types of licenses are issued by each state government. An individual or company can seek the grant of the following licenses:

1. Grant of L-1 license: For the wholesale supply of Indian Liquor

The government of India every year formulates policies for grant of this license in pursuance of which it is granted to the wholesale supply of Indian liquor. It is granted to Company or a society or a partnership firm or proprietorship firm having licensed manufacturing units (distillery/brewery /winery/bottling plant).

Procedure for application of this license:

The govt. invites applications by issuing a public notice in a leading newspaper and on the official website of the government. The prime job of L-1 Licensee is to supply liquor to the holders of Licenses of L-6, L-7, L-9, L-10, L-12, L-13, L-14, L-15, L-16, L-17, L-18, L-19, L-20, L-21, L-28, L-29 and other liquor licenses in the Country. The holder of an L-1 license has to comply with all the terms and conditions mentioned in the license contract.

2. Grant of L-6 License: For retail vendors

L-6 License is issued to the retail vendors of Indian liquor/beer which is granted to selected undertakings of the government. In regard to premises for such liquor shops, proposals are invited by selected and approved corporations. The grant of this license by the excise commissioner is given only after looking into the suitability of such premises.

3. Grant of L-3/L-5 Licences: For hotels

The govt. grants these licenses to hotels that are holding star classification and also the approval from the Tourism Department of Govt. of India which is considered necessary for the grant of License in form L-3. L-3 license empowers the hotel for the service of foreign liquor to the residents in their rooms. These hotels can also seek separate Licenses in form L-5 for serving the liquor in exclusive bars and the restaurants in the hotel premises.

4. Grant of L-19 License: For clubs

The L-19 license is granted to a club registered with the Registrar of Firms/Registrar of Cooperative Societies for service of foreign liquor to its members. It is subject to the provisions of the Punjab Excise Act, 1914 as extended to different parts of the country.

5. Grant of L-49A license: Marriages, Parties, etc.

This license can be obtained on payment of a certain amount for service of liquor in any party, function, marriage, etc. at a specific premise excluding public parks subject to the following conditions: –

• The area should be away from the public view.
• Liquor should be served to adults above 25 years of age.
• Liquor should be procured from an authorized source in the State.

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