Highway liquor ban: Punjab Assembly Amends Definition Of ‘Sale’ And ‘Supply’ Of Liquor To Circumvent SC Order [Read The Bill]

The Punjab Assembly on Friday passed the Punjab Excise (Amendment) Bill, 2017, to allow the sale of liquor at hotels, clubs and restaurants, located within 500 metres of state and national highways. The Bill changes the definition of ‘sale’ of liquor, therefore exploiting a loophole to sidestep the Supreme Court ban.

“Punjab had decided to amend the Punjab Excise Act, 1914, to ensure that the hotels, restaurants, clubs and other notified places are allowed the supply of alcohol only for consumption within their premises to secure livelihood of a large segment of the state’s population. However, there shall be restriction on the opening of liquor vends on or within 500 metres of highways,” the Bill reportedly states.

The Punjab Excise Amendment Bill, 2017 introduces two clauses – 18 (a) and 19 (a) – to differentiate between ‘sale’ and ‘supply’ of liquor. While the first clause defines sale of liquor as “transfer of consideration by a liquor vend for consumption by a purchaser at a place other than its premises”, clause 19 (a) defines supply of liquor as “provision of liquor for consideration at clubs, restaurants, hotels and other places on the basis of licences issued on the condition that it shall be consumed within their premises”.

The Bill, therefore, permits catering establishments to provide liquor to customers as long as it is consumed on their premises. The legislation adds that licensed hotels, clubs and restaurants will be entitled to continue supplying liquor even if they are located on state and national highways – notwithstanding any judgment or decree passed by a Court or Tribunal in that regard.

Punjab Health and Parliamentary Affairs Minister Brahm Mohindra, who tabled the Bill, reasoned that the ban had the potential to cause large-scale unemployment and financial losses. “Hotels, clubs and restaurants are part of the hospitality industry, and they generate thousands of jobs. Even their partial closure can create substantial unemployment. One can shift liquor vends, but not hotels and clubs. Their closure can also impact the state’s future excise revenue. This amendment has been brought in view of the serious implications the ban can have on state revenue and jobs,” he was quoted as saying.

The Supreme Court had, in the case of State of Tamil Nadu Rep. By Its Secretary Home, Prohibition & Excise Dept & Ors v. K. Balu, banned the sale of liquor within 500 metres of State and National Highways, including at bars, hotels and restaurants that serve alcohol. The judgment had justified its stand through the alarming statistics on the occurrence of road accidents. The order was subsequently modified on March 31, to provide the following reliefs:

1. In the case of areas comprised in local bodies with a population of 20000 people or less, the requirement of maintaining a distance of 500 metres from the outer edge of the highway or service lane, for the location of the liquor shop, shall stand reduced to 220 metres. This was because of the grievance that the entire local area may fall within the prohibited distance. The entire Himachal Pradesh would qualify for this relaxation;


2. The existing licence shall continue until the term of the licence expires but in any event not later than 30 September 2017;


3. Meghalaya and Sikkim, on account of their hilly and forest terrains, are exempted from the application of the 500 metre distance requirement.