Odisha govt withdraws liquor shop e-auction notice

The state govt to come out with a comprehensive procedure of e-auction

The state government on Tuesday has withdrawn its notification for e-auctioning of liquor shops before the Odisha High Court (HC).

"The government notification dated February 28, 2013 for e-auctioning of liquor shops has been withdrawn. We will come out with a comprehensive procedure of e-auction," said Ashok Mohanty, Advocate General, Odisha. A division bench comprising Justice Indrajit Mahanty and Justice Raghubir Dash was hearing the cases filed in the HC, challenging the newly introduced system. As many as 30 dealers across the state had moved the HC, opposing the notification.

The last allotment of country and foreign liquor shop licenses, through the prevalent lottery system, took place in 2005 and every year, they were getting renewed with average 10 per cent increase in the license fee.

There are about 1,131 Indian Made Foreign Liquor (IMFL) and more than 500 country liquor shops in the state. The state cabinet, chaired by chief minister Naveen Patnaik, had recently approved the e-auction system, replacing the seven-year-old lottery system. The state had gone ahead with the proposal despite submission of reports by its excise officials highlighting the poor experience of other states which had adopted such a system in the past. The state government last year had sent three deputy excise commissioner rank officials to Andhra Pradesh (AP), Tamil Nadu and Karnataka to study the e-auction system in practice there and report back their findings. DK Nag, the then deputy commissioner-excise who visited Andhra Pradesh to study the system had reported that auction sale of liquor shops had given rise to a scam of Rs 7,000 crore in AP, leading to detention of many officers behind bars. Dealers in the state have been complaining that the auctioning will open the doors for big and unscrupulous players from other states and push the local vendors out of business.