Uttar Pradesh implements revised excise policy

In a bid to check the evasion of excise duty by the wholesale dealers of Indian made Foreign Liquor (IMFL), Beer and country-made liquor, the Uttar Pradesh government has affected changes in the excise policy for the current fiscal.

The policy for the current fiscal was announced by the previous Samajwadi Party-led government in January last. This proposal was approved by the cabinet here today.

At present, the whole sale traders of spirits directly source the product from the distilleries for sale within UP. Some distilleries also export their product to other states if it fetches a better price. In both the cases, it was found that the whole sale traders and the distillery owners were evading excise duty.

With the change in policy the government has introduced a third party in the transaction thus banning the direct sale or export by the distilleries. The third party will be a public sector unit (PSU).

The distilleries can no longer sell their product to the whole sale trader and it will be routed through the PSU to be appointed by the state government soon.

Official sources said in many districts the distillery owners and whole sale traders were the same persons and were easily evading the excise duty.

Official sources said the PSU for the purpose is yet to be identified and this process will take few weeks time as the relevant rules like the payment of license fee by the PSU and other terms and conditions were yet to be framed.

The sources added that all the licencees of the IMFL, country liquor, beer bar and model shops won't be affected by the changes in the policy and they would continue to operate during the current fiscal according to the terms and conditions.

In last fiscal 2006-07, the state government, against the target of Rs 3,450 crore, mopped up Rs 3,552 crore as excise duty from tipplers.

The previous Samajwadi Party government had fixed the target of Rs 3,850 crore for the current fiscal. The present government has revised the target to Rs 4,100 crore for 2006-07.