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CIMA Gallary

Starved govt hits the bottle
- Bars can stay open till 1am during festival season after paying a fee

Calcutta, Oct. 12: The cash-starved Bengal government has extended the closing time of bars by an hour for a price, tapping the festival season on the time-tested premise that more empty bottles will make the state’s coffers less empty.

Each establishment will have to pay Rs 10,000 for every night it keeps the liquor flowing for the additional hour, according to an excise department notification signed by finance secretary H.K. Dwivedi.

The decision extending the official closing time from midnight to 1am came into effect yesterday and will be in place till the end of the festive season that will stretch beyond the New Year.

“A circular will be issued on Tuesday stating that this will stay effective till January 10 next year. This is something we thought was necessary during the festive season,” said a senior official this evening amid loud cheers from several hotels and restaurants that serve liquor.

In consultation with police, the state excise department determines the closing time for bars, which has been revised several times in the past few years.

Since March 2012, all bars have been told to serve the last drinks by 11.30 and shut shop by midnight. The directive followed the alleged gang-rape of a lady who had stepped out of Park Hotel in February.

Earlier, the official closing time was midnight, extendable to 2am with a late-night licence. Most nightclubs used this extension every Wednesday, Friday and Saturday.

“We are extremely grateful to the authorities for considering this long-pending request from hotels, restaurants and bars,” said a representative of Park Hotel, which runs three night clubs and a 24-hour coffee shop.

“We do feel that keeping the high investments and business viability of star deluxe hotels in mind, it is critical that they are granted a 24-hour licence to serve liquor as in the states of Tamil Nadu, Andhra Pradesh, Delhi and others,” added the spokesperson.

Delhi has a staggered system in which bar licences are issued to stay open till 11pm, midnight, 1am and round the clock (usually for hotels) — the fee going up along with the duration.

Pub-city Bangalore closes shop at 11.30pm but the last drinks have to be served at 11pm. Bars in cities in Kerala, the per-capita tipple topper, can stay open till midnight. In Mumbai, the bar owners’ association has succeeded in persuading the government to extend the closing time from 12.30am to 1.30am on all days.

Governments are known to drown their revenue sorrows in more liquor licences and longer tippler hours. But Bengal has lagged behind some other states in excise collection. (See chart)

If the trend points to a society that sticks to abstinence, it is a healthy sign — Bengal does have a strong tradition of protests against liquor vending units.

However, if the regulations are driving people to illicit liquor, it will mean that their lives are being imperilled and the state is losing revenue.

In an attempt to emulate the southern states that follow a liberal licence policy, former finance minister Asim Dasgupta had tried to forge a political consensus towards the end of the Left rule. But he failed to convince Trinamul leaders, who were against granting fresh licences.

“Across the state, there are several licensees who cannot open off-shops (outlets) because of opposition from Trinamul leaders,” said a finance department official.

Against this backdrop, the excise department’s latest notification stands out.

A finance department official, however, linked the decision to the dire economic needs of Bengal, reeling under a debt of over Rs 2.2 lakh crore.

The government has already exhausted nearly half of its market borrowing limit of Rs 20,528 crore midway through the financial year and is looking for avenues to augment its income at a time its leverage with the Centre has diminished.

“Excise collection can easily be stepped up by granting more licences to off-shops or allowing bars to operate for longer hours. In view of opposition at the grassroots, the government is not issuing fresh licences but it is trying to step up revenue by extending bar timing,” said an official.

In his budget speech for 2012-13, finance minister Amit Mitra had set an excise collection target of Rs 2,786.47 crore. “Roughly, we have collected over Rs 1,200 crore till September 30. Our target is Rs 2,700 crore. We are positive about meeting, if not bettering, the target,” state excise commissioner Deb Kumar Chakraborty told The Telegraph.

Chakraborty did not link the confidence to the excise notification.

But a source said: “There are no definite projections yet but this could make a difference of at least 10 per cent this financial year, which means extra earnings of around Rs 270 crore.”