On government table: A Presidential reference to Supreme Court on liquor sale ban order

Revenue loss, pleas by hotel industry forcing states to turn to Centre

Written by Maneesh Chhibber | New Delhi | Updated: April 5, 2017 10:52 am
Liquor ban, highway liquor sale ban, liquor sale ban, supreme court order, states divided, india news, indian express news 62 liquor outlets and bars dot a 9 sqkm stretch in Mahe

With many state governments seeking its intervention in making the Supreme Court reconsider its order banning sale of liquor within 500 metres of state and national highways, including at bars, hotels and restaurants that serve alcohol, the Centre is open to the idea of “considering” making a Presidential Reference to the Supreme Court on the issue. As an alternative, the Centre is also open to the idea of supporting a review petition filed by hotels and tourism industry bodies, seeking a review of the Supreme Court judgment on the limited issue of allowing hotels and licensed bars to serve liquor.

The Centre’s inclination to seek a Presidential Reference comes with a caveat though: a group of state governments will have to make a request in writing, seeking a Presidential Reference under Article 143 of the Constitution to the Supreme Court.

This, sources told The Indian Express, view has developed within top echelons of the Central government in view of the possibility of state governments suffering heavy loss of revenue due to closure of majority of the liquor vends and bars inside the hotels and outside. For most states, excise revenue from annual auction of liquor vends is one of the biggest sources of revenue. The negative impact that the Supreme Court order is likely to have on the tourism sector is another reason for the changed mindset.

The Centre will also seek the opinion of Attorney General Mukul Rohatgi who appeared for Tamil Nadu government in the matter and who has earlier opined that the court-ordered ban on liquor vends within 500 metres of state and national highways would not apply to pubs, bars, hotels and restaurants that serve alcohol.

“We are open to the idea of seeking a Presidential Reference on the issue since the issue assumes significance due to its public importance, especially since a lot of revenue and job loss will happen if the Supreme Court order is implemented as it is. But, we will do it only if some of the aggrieved states approach us,” a source said.

A senior functionary of the Ministry of Tourism told The Indian Express, “We are concerned that hotels have also come under the ambit of the judgment along with liquor vends. If the industry goes for a limited review we may implead ourselves to endorse their position.” Incidentally, during the hearing of the case before the Supreme Court bench headed by Chief Justice of India (CJI) J S Khehar, the Central government’s counsel had supported the court’s decision.

Under Article 143, the Centre can request the President to make a reference to the Supreme Court, asking it to give its opinion if there is a “question of law or fact” that has arisen or is likely to arise, “which is of such a nature and of such public importance that it is expedient to obtain the opinion of the Supreme Court”. The Supreme Court can, however, refuse to answer all or any of the queries raised in the Reference.

Advocates General of two states, including a BJP-ruled state, as well as a senior law officer for Congress-ruled Karnataka told The Indian Express that they were also mulling sending a request to the Centre to send a Presidential Reference under Article 143 to the Supreme Court.

When contacted, advocate Dev Dutt Kamat, Additional Advocate General, Government of Karnataka, who appeared for the the state before the CJI-led bench on the issue, said, “The Presidential Reference, in my opinion, is the most feasible option. With lakhs of direct and indirect jobs on the line and state governments staring at revenue losses to the tune of lakhs of crores, the Centre should go for this option. I have advised the Government of Karnataka to make a request in this regard to the Central government and I am told many other state governments have also received similar advice.”

Asked if the measure by some state governments to negate the impact of the Supreme Court ruling by renaming some state roads as district roads or urban roads wasn’t enough, Kamat said, “This can’t be an everlasting solution.”

The Advocate General of a state, who did not wish to be named, said, “It is not just an issue of deaths due to drunken driving. The revenue to the states from excise and growth of tourism sector are also to be considered. The final decision will be taken by the government but I have suggested making a request to the Centre to seek Presidential Reference.”

Incidentally, Union Tourism Minister Mahesh Sharma also indicated Monday that the Centre was seeking legal suggestions to explore a “middle path” to solve problems being faced by hoteliers and restaurant owners following the apex court’s order banning liquor sale along highways.

He had, however, added that the government would work within the framework of the directives of the Supreme Court in the matter.

The Centre, it may be recalled, had taken recourse to a Presidential Reference after the 2G spectrum scam judgment. In that case, the President had sought the Court’s opinion on whether it could interfere with policy decisions.

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