Chandigarh excise and taxation department to give liquor vend auction third go with reserve prices slashed by 3% to 5%

After tepid response to the first two rounds of liquor vend auctions, the UT excise and taxation department has slashed the reserve price of the unsold liquor vends in an attempt to attract more takers.

Through the first two auctions, held on March 15 and 21, the department had managed to auction only 54 of the 95 liquor vends in the city.

Now, inviting bids for the remaining 41 liquor vends, the department has reduced the reserve price by 3% to 5%. The bids can be placed on the department’s website — — till March 27, following which the bids will be opened the same day.

However, Darshan Singh Kler, owner of Kler Wines, who bought six liquor vends in the auction held on March 15, said, “The reduction in reserve price will not help, as it is very marginal. Unless the administration slashes the excise duty and VAT, the response will remain poor.”

A liquor contractor, who wished not to be named, said liquor rates were same across the tricity. So, unless Chandigarh administration offered perks better than the neighbouring states, contractors would not invest in Chandigarh.

In the auction held on March 15, only 43 of the 95 vends had found buyers, bringing in 221 crore against a reserve price of 202 crore.

Among the vends auctioned, the one in Palsora had raked in the highest bid of 11.65 crore against the reserve price of 9.60 crore. Surprisingly, the liquor vend in Dhanas, located near the Punjab border (Mullanpur), which had been receiving the highest bids for the past two years, failed to even find a buyer. Last year, it was auctioned for the highest-ever amount of 12.78 crore. Even, the Khuda Lahora vend went unsold.

The subsequent auction on March 21 saw only 11 of the remaining 52 vends getting auctioned, fetching the department 54.85 crore against the reserve price of 51.27 crore.

Here, the vend in Khuda Lahora received the highest bid of 7,56,90,000, only 5,000 more than the reserve price of 7,56,85,329.

UT staring at 553.6-crore revenue gap

For financial year 2023-24, the department has fixed a target of 830 crore for liquor vends’ licence fee. Having earned only 276.4 crore so far from two auctions, it is staring at a revenue gap of 553.6 crore.

Last year, the department had to hold seven auctions and still could not sell three of the total 96 vends. The total revenue earned was around 500 crore.

Notably, with a week left before the end of the financial year, the department has not been able to achieve even its liquor revenue target, set to further dent its excise earnings.

Against the target of 887 crore for 2022-23, the administration has collected a total revenue of 800 crore till date, translating into 90%.

In the previous 2021-22 financial year, UT had achieved 89% target by collecting 724 crore against annual target of 806 crore.


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