What’s in today’s article?
- Why in news?
- Delhi Excise Policy 2021-22
- What is Delhi Excise Policy 2021-22?
- What are the key features of the Delhi Excise Policy 2021-22?
- How did the controversy surrounding Delhi Excise Policy 2021-22 erupt?
- What were the main allegations in the Vigilance Department’s report — on the basis of which the CBI has built its case?
Why in news?
Delhi’s Deputy CM Manish Sisodia was arrested by the Central Bureau of Investigation (CBI) regarding the alleged irregularities in the now-scrapped Delhi excise policy.
What is Delhi Excise Policy 2021-22?
- Also known as the new liquor policy, the Delhi Excise Policy 2021-22 was implemented on November 17, 2021.
- It changed how liquor was sold in the city — with the government withdrawing from the business and allowing only private operators to run liquor shops.
- The main aim was to improve customer experience and stop black marketing.
- However, after the whole controversy around the new excise policy, Delhi reverted to the old excise regime.
What are the key features of the Delhi Excise Policy 2021-22?
- Under the new liquor policy, the city was divided into 32 zones inviting firms to bid on the zones.
- Instead of individual licences, bidding was done zone-by-zone.
- Also, licenses for 849 retail vends were issued through open bidding by the Excise department in 2021.
- Under the old liquor policy, Delhi had 864 liquor shops, including 475 run by the four government agencies, and 389 were private.
- For the first time, shops were allowed to offer discounts to retail customers and reduced the number of dry days to three from 21.
- The new policy also had a provision for home delivery of liquor. It even proposed lowering the drinking age from 25 to 21.
- It also suggested the opening of shops till 3 am. However, these were not implemented.
How did the controversy surrounding Delhi Excise Policy 2021-22 erupt?
- Before the implementation, the policy had first to be examined by the Chief Secretary (CS) of Delhi Naresh Kumar
- The CS allegedly found procedural lapses and irregularities in the new policy.
- In the report, Delhi Deputy CM Sisodia, who heads the excise department, was accused of making changes to the excise policy without the approval of the L-G.
- Based on the Chief Secretary’s note, the LG asked for a detailed report by the Vigilance Department.
- After reviewing the report by the Vigilance Department, the L-G suggested a CBI probe into the matter.
What were the main allegations in the Vigilance Department’s report — on the basis of which the CBI has built its case.
- Delhi liquor policy: Discounts, ‘1+1’ schemes
- Hefty discounts being offered by liquor retailers were causing severe market distortions.
- Licensees were issuing advertisements and promoting liquor and their shops through various means in violation of Delhi Excise Rules 2010.
- The government failed to take penal action against licensees for this.
- Undue benefits were given to liquor licensees by revising the rates of foreign liquor and removing the import pass fee of Rs 50 per case of beer.
- This made foreign liquor and beer cheaper for retail, leading to a loss of revenue for the state exchequer.
- Number of dry days
- The new excise policy reduced the number of dry days from 21 in the 2021 calendar year to three in 2022.
- This was done without approval from the Council of Ministers, and without seeking the LG’s opinion.
- Extension of licences
- The licences issued to liquor retailers were extended from April 1, 2022 to May 31, 2022, and then from June 1, 2022 to July 31, 2022.
- Such extensions were allegedly given by Excise officials on their own, without any increase in the tendered licence fee.
- This contravened an earlier proposal approved by the Council of Ministers, which said that the licence fee may be increased at the end of 2021-22 after considering the real time-based actual sale data.
- No such exercise was undertaken by the officers of the department.
- The extension of the licence period without an increase in fee prima facie led to undue benefit to the licensees without any justification.
- Waivers, licence fees
- The report flagged the blanket relaxation given by the Excise Department in case of default in the payment of licence fees.
- It said licence fees worth Rs 144.36 crore were waived in January 2022 on pretext of COVID restrictions as relief to the Liquor Cartel.
- This was done despite the Accounts Branch of the Excise Department having specifically recommended that no compensation should be allowed to licensees.
- The link to Goa Election
- The Enforcement Directorate (ED) accused the government in Delhi of using a part of the kickbacks from the liquor scam to fund the party’s campaign for Goa assembly election.
Q1) What is the role of Central Bureau of Investigation (CBI)?
The Central Bureau of Investigation (CBI) is the primary investigation agency of India. It handles bribery, corruption case, organized crimes, and other economic crimes. Since the organization also has ties with Interpol, it has the jurisdiction of international crimes.
Q2) What are the functions of excise Department?
The customs and excise division has multiple roles that includes: collection of government revenue (customs and excise duties, import value added tax and other levies), facilitation of legitimate imports and exports, protection of Botswana society against cross-border crime and combating unfair and harmful trade practices.