Excise the World of Intoxication

REVENUE EARNING DEPARTMENTS - EXCISE THE WORLD OF INTOXICATION

Alcoholic Drinks: Previous Era Alcoholic Drinks: History

Alcoholic drinks made from fermented food stuffs have been in used from ancient times. Fermented drinks antedate distilled spirits, though the process of distillation was known to the ancient Assyrians, Chinese, Greeks and Hindus. The manufacture, sale and consumption of intoxicating liquor have been subject to state control from very early times in India.

Alcoholic Drinks - in India

Drinks were known in India in Vedik and Post Vedik times. The celestial drink of Vedik period is known as Soma. • Sura is fermented beverage during Athavana Veda period. Alcoholic Drinks – Making in different periods

• Pulasty’s • Kautilya’s Alcohol making : Pulasty’s Period

• Panasa( Liquor from Jack fruit) • Madhvika (Mohowa Liquor) • Draksha (Liquor from Grape) • Saira (Long pepper Liquor) • Madhuka (Honey Liquor) • Arishta (Soap Berry Liquor) • Khajura (Date Liquor) • Maireya (Rum) • Tala (Palm Liquor) • Narikelaja (Coconut Liquor) • Sikhshava (Cane Liquor) • Sura / Arrack.

Alcohol making : Kautilya’s Period

• Medaka • Prasanna • Asava • Arisha • Maireya • Madhu

Indian Alcoholic Beverages Indian Alcoholic Beverages : Types

• Traditional Alcoholic Beverages • Non- Traditional Alcoholic Beverages Traditional Alcoholic Beverages

• Feni • Hudamaba • Palm Wine • Handia • Hariya • Kaidum • Desidaru • Sonti • Kodo Kojaanr • Apo / Apung • Sulai • Laopani • Arrack • Sundakanji • Luqdi • Bangla • Sura • Mahua • Bitchi • Tati Kallu • Mahuli • Chhaang • Tharra • Mandia Pej • Cholai • Zawlaidi • Manri • Chuak • Zutho • Pendha • Sekmai

Non - Traditional Alcoholic Beverages

• Indian Beer • Indian Brandy • Indian made Foreign Liquor • Indian Rum • Indian Vodka • Indian Wine Alcoholic Beverages Alcohol Beverages : as a source of Revenue

Alcoholic beverages received to distinctions with the advent of the British Rule in India. It acquired the social status and it also received recognition as a source of Revenue. Alcohol Beverages : as a source of Revenue

The East India Company introduced the Abkari Excise System in 1790, completely disregarding the attitude traditions, Heritage, custom or religion of the people. The Company introduced the Excise system whereby the right to manufacture and sell alcohol was given to the highest bidder without any restriction as to the price quality, or no. of shops. This was known as out still system. Alcohol Beverages : as a source of Revenue

Later the Government countered the above system by introducing central Distillery system it began in the united provinces in 1862. Distilleries were established in large cities after adding Excise duty to it was supplied to the retailers. It was called Still Head duty. Alcohol Beverages : Laws and Acts

• In 1871, the Government ordered auction of Licenses for liquor shops under central distillery system. • In 1879, the practice underwent a change in favour of Outstill system. • In 1884, Bengal Commission was appointed; the Commission recommended the introduction of Central Distillery System in several large towns. They also proposed the price of the liquor should be increased by raising the prices of the shops at auction and that a minimum price of a liquor should fixed in each District.

Alcohol Beverages : Laws and Acts

• The next stage the Excise Policy was Evolved after the report of Indian Excise Committee in 1905. The Government of India laid down the general policy. • On achieving freedom the policy of Prohibition was incorporated in Article: 47 of the constitution of India as a directive principle of State Policy. Alcohol Beverages : Laws and Acts

• In Southern India the first legislation in British India so far as Abkari Revenue is concerned appears to be Madras Act – XIX of 1852 for better securing the Abkari revenue of the town and sub- urbans of Madras. A systematic condification appears to have been attempted by Act- III of 1964 Madras. Alcohol Beverages : Laws and Acts

• Prior to 1st November 1956, Hyderabad Abkari Act was in force erstwhile Hyderabad State and the same enactment continued to be in force in Telangana Region of Andhra Pradesh till 1968 and the state derived its Excise income under the provisions of this Act. • In 1968, the A.P Excise Act brought into force in Telangana region on 30th August 1968 repealing the earlier Abkari Act. Alcohol Beverages : Laws and Acts

• The erstwhile Andhra State consisting of 11 Districts and Telangana from erstwhile Hyderabad State comprising of 9 districts were merged on 1st November 1956 and the State of Andhra Pradesh came in to existence. • Prohibition was first enforced in 8 districts of the then composite Madras State including Ananthapur, Kadapa, Kurnool and Chittor districts in 1946 it was extended to Nellore and Guntur Districts with w.e.f 01.10.1947.

Alcohol Beverages : Laws and Acts

• The district of Krishna, West Godavari, East Godavari, Visakhapatnam and Srikakulam were brought under Prohibition in October 1948. By 1948 the entire Andhra region with the exception of scheduled area was completely brought under total Prohibition. Alcohol Beverages : Laws and Acts

• The Enforcement of Prohibition was entrusted to the Police Department in the districts of Chittoor , Nellore and Guntur and to Excise and prohibition Department in remaining 8 districts. These districts were also transferred to the Police department for Enforcement work w.e.f 15.01.1956 by GO.M.S.No:69, dt:10.01.1956. however the residuary Excise work of all the 11 districts was retained with the Excise department. the above position continued till 31.01.1961. Alcohol Beverages : Laws and Acts

• The work of Enforcement of Prohibition was transferred from Police Department entrusted to Excise Department by GO.M.S.No:42, dt:06.01.1963. Till 1963 there was total prohibition in Andhra State.

• In 1963the Sweet Toddy Scheme was introduced in Andhra region under the Sweet Toddy (Neera) Rules framed under Prohibition Act,1937 in force in Andhra region Neera shops were auctioned on the pattern of Toddy shops. Alcohol Beverages : Laws and Acts

• Prohibition was enforced in Andhra area till 31st October 1969. On 1st November 1969 Prohibition was repealed by GO.m.S.No:1000, dt:14.10.1969 in Andhra region and the provisions of the Andhra Pradesh Excise Act 1968 already in force in Telangana region was extended to the Andhra region also w.e.f 1st November 1969. Alcohol Beverages : Laws and Acts

• The Excise Department is responsible for implementing the provisions of A.P. Excise Act,1968, A.P Intoxicating Liquors(Prohibition of Advertisements) Act,1979, A.P Spirituous preparation (inter State trade and commerce) control Act,1955 and the rules framed under each of the above statute. • Prohibition was lifted in Andhra area w.e.f 1st November 1969 from the date onwards there has been no prohibition and the sale and consumption of alcoholic drinks in the state of Andhra Pradesh.

Alcohol Beverages : Laws and Acts

• The sale of Arrack was banned by the Government w.e.f 1st October 1993 but there is no ban on the sale and consumption of IMFL. Hence total Prohibition laws came into existence from 16.01.1995.(AP prohibition Act, 1995 came in to force). • From 01.04.1997 introduced partial Prohibition in the State of Andhra Pradesh. PROHIBITION & EXCISE DEPARTMENT Acts and Rules Important statutes and Acts that are administered

• The A.P. Excise Act, 1968 • The A.P. Prohibition Act, 1995 • The Narcotic Drugs and psychotropic substances Act, 1985 • The A.P. Intoxicating liquors ( Prohibition of Advertisements ) Act 1978 • The A.P. (Regulation of wholesale trade and distribution and retail trade in Indian Liquor and Foreign liquor Wine and Beer) Act 1993 (amended in 2019) • The A.P. Excise (Issue of Duplicate Licenses and permits) Rules, 1969 • The A.P. Chloral Hydrate Rules, 1973 • The A.P. Excise (Mohwa Flowers) Rules, 1973 • The A.P. Excise (Compounding of Offences) Rules, 1973 • Excise (Appeal and Revision) Rules, 1969 Important statutes and Acts that are administered

• The A.P. Excise (Disposal of confiscated and other Articles) Rules, 1969 • The A.P. Excise (Delegation of Powers) Rules, 1972 • The A.P. Excise (Levy of Interest on Government Dues) Rules, 1982 • The A.P. Prohibition (Compounding of Offences) Rules, 2000 • The A.P. Excise (Import, Export & Transport of IMFL – Permit) Rules 2005 • The A.P. Excise ( Grant of License of selling in-house and conditions of License) Rules, 2005 • The A.P. Excise ( Grant of License of selling by Bar and conditions of License) Rules, 2019 • The A.P. Excise ( Lease of right of selling by Shop and conditions of License) Rules, 2019 • The A.P. Excise ( Grant of License of selling in-house and conditions of License) Rules, 2005 • The A.P. Excise (Grant of License to sell toddy conditions of License and tapping of Excise trees ) Rules, 2007 DISTILLERY WING AT A GLANCE

Distillery

This is a wing of Prohibition & Excise department. This wing consists of units with various kinds of Licenses. Distillery Wing consists of primary units, bottling units, breweries wineries. Besides these units there are industrial units, L1 units, molasses units. The following are the units under different categories of Licenses which are being governed by AP Distillery Rules. Distillery - Classification

The units are classified into (8) types by virtue of their functionaries. They are :

• Primary units • IMFL Units • Breweries • Wineries • RS License Units • DS License Units • Pharma Units • Molasses units.

Distillery - Classification

• Primary Units functions will be governed by AP Distillery (Manufacture of Spirits) Rules, 2006. • IMFL units will function under the rules framed as AP Distillery (Manufacture of IMFL other than beer and Wine) Rules,2006. • Breweries functions will be governed by AP Brewery Rules,2006 • Wineries functions will be governed by AP Winery Rules,2006 Distillery - Classification

• RS License Units will function under the rules AP Rectified Spirit Rules 1971 • DS License Units will function Under AP Denatured Spirits and spirituous preparations Rules,1971 • Pharma Units will function under Medicinal& Toilet preparations (Excise Duties) Rules,1956 (at present it is repealed) • Molasses units will function under AP Excise (Possession, Import, Export, Transport of Molasses conditions of License and permits ) Rules,2008. I) Primary unit Licenses

• Under AP Distillery Rules ,2006 the Distillery was defined as a manufactory where spirits are manufactured from fermenting sugars or carbohydrates by distillation for potable purpose or for industrial purpose or for both and includes re-distillation of spirits. • The Licenses under these rules were classified in to (10) types basing on their mode of function as follows.

Primary unit - Classification Sl.N Type of Purpose of which License is required o License License to Manufacture Spirits from Molasses as fermentative base 1 D2(PM) for portable purpose License to Manufacture Spirits from Grains as a fermentative base for 2 D2(PG) portable purpose. License to Manufacture Spirits from Molasses and Grain or from any 3 D2(PMGO) other fermentative base for portable purpose License to Manufacture Malt Spirits from fermenting Malt for 4 D2(MS) portable purpose either for commercial or capital needs. License to Manufacture Spirits from Molasses as fermentative base 5 D2(RM) for Industrial purpose wholly or partly. Primary unit - Classification

Sl.N Type of Purpose of which License is required o License License to Manufacture Spirits from Grains as fermentative base for 6 D2(RG) Industrial purpose wholly or partly. License to Manufacture Spirits from Molasses and Grain or from any other 7 D2(RMGO) fermentative base for Industrial purpose wholly or partly. License for Manufacturing ENA by re-distilling Molasses based rectified 8 D2(EM) Spirit for portable purpose License for Manufacturing ENA by re-distilling Grain based Molasses 9 D2(EG) based rectified Spirit for portable purpose License for Manufacturing ENA by re-Distillation of Molasses based and 10 D2(EMGO) Grain based rectified Spirit or RS obtained from any other fermentative based for portable purpose either for commercial or captive needs. II) Secondary unit licenses

These units functions will be governed by AP Distillery (Manufacture of IMFL other than Beer and Wine ) Rules,2006 in which the unit was defined as a manufactory where spirits are compounded, blended, processed, fortified and or diluted to produce Indian Made Foreign Liquor other than Beer and Wine and includes an operation for bottling of such liquor.

II) Secondary unit - Classification • The licenses under these rules were classified into 3 types as follows basing on the mode of function. • At present there only DM 2 (MGO) units existing in the State. S.No IMFL Licenses Mode of function License for manufacturing IMFL by utilising Molasses based 1 DM-2(M) ENA . License for manufacturing IMFL by utilising Molasses based 2 DM-2(G) Grain bases ENA. License for manufacturing IMFL by utilising both molasses and Grain based ENA or ENA obtained from any other 3 DM-2(MGO) fermentative base as notified by the Government from time to time Brewery Licenses

These licenses will be governed by AP Brewery Rules,2006 and the amendments vide GO.Ms.No 40 Revenue (Excise-II) Dept,Dt:30-01-2016. The definition of Brewery under these Rules is A manufactory where beer is manufactured and includes every place where beer is stored or issued. And for Micro Brewery “A small brewery where the draught Beer is manufactured and served for consumption in glass or pitchers within the premises whose capacity shall not exceed 1000 Bls per day and shall be permitted in Municipal Corporations only. Brewery - Classification

• The licenses under these rules are of two types as follows basing on the mode of production.

S.No Licenses Mode of function 1 B2 License License for Manufacture of Beers. License for Micro Brewery ( Production Capacity :1000 2 MBL1 License BLs per day) IV) Winery License

These units will be governed by AP Winery Rules,2006 in which it is defined as a manufactory where wine is made. The following is the license that will be issued under these rules.

S.No Licenses Mode of function 1 Form –W2 License for Manufacture of Wines V) R S Licenses

These licenses will be governed by AP Rectified Spirit Rules,1971. They are in the following forms basing on utilization purposes. S.No Licenses Mode of function License for Possession and use of R.S.I (up to 10 Ltrs by Private 1 R.S. I Medical Practitioners) License for Possession and use of R.S by Medical Scientific 2 R.S. II Educational and research Institutions and Laboratories License for Possession and use of R.S in the Manufacture of 3 R.S. III Industrial preparations VI) D.S Licenses:

These licenses will be issued under AP Denatured Spirits and Denatured spirituous preparations Rules, 1971.They were classified into (5) Forms basing on the utilization. VI) D.S Licenses - Classification

S.No Licenses Mode of function License for retail sale of Denatured Spirit / Methylated Spirit / Methyl 1 D.S.IX Alcohol License for possession and use of Denatured spirit in Manufacture of French 2 D.S.XI Polish, thinners, Metal Polish, Soaps, other denatured spirituous Preparations or for industrial purposes as re-agents or solvents etc., License for possession and use of Denatured Spirit for industrial purposes as 3. D.S.XI ( A) reagent or solvent and for manufacture of DS preparations other than those mentioned in Form DSXI. License for possession and use of Denatured spirit by Medical Practitioner, 4 D.S.XIII Non-Government Hospital, Educational, Scientific or research Institutions, Clinics and Laboratories License for possession and use of Denatured Spirit ,Methylated spirit or 5 DS XV Methyl Alcohol for Government Departments,Railways and Local bodies. VII) Licenses under M & T.P Act:

There are 5 types of licenses under State control under M&TP Act and the same M&TP Act was repealed from 1-07-2017 by section 174 of the CGST Act 2017.,and further rules to be made on this item. It may be considerable in state list i.e., SGST as there is utilization of Alcohol in the units by imposing regular duties. Licenses under M & T.P Act: S.No Licenses Mode of function

License to Manufacture Medicinal and Toilet preparations containing 1 L-1 Alcohol, Opium, Indian hemp and other narcotic Drugs and Narcotics under bond for payment of duty

License to Manufacture Medicinal and Toilet preparations containing 2 L-2 Alcohol, Opium, Indian hemp and other narcotic Drugs outside bond

License to Manufacture Ayurvedic,Unani preparations containing self- 3 L-3 generated Alcohol by Ayurvedic or Unani practitioner for dispensing and for trade purpose. 4 L-4 License for bonded Warehouse

A Loan License means a License which licensing authority may issue to an Loan License applicant who does not have his own arrangements for manufacture but 5 (Form – L1) intends to avail himself of the manufacturing facility owned by licensee in form-L1 VIII) Molasses Licenses:

There are (6) types of licenses as follows which will be governed by AP Excise (Possession, Import, Export, Transport of Molasses conditions of Licenses and permit) Rules,2008. Molasses Licenses - Types S.No Licenses Mode of function 1 M-I License for possession and sale of Molasses by a producer of molasses. 2 M-II License for possession of Molasses to persons other than producers of molasses. • License for any Government purpose or Educational, Scientific, Medicinal or sample purpose. • License for any Agricultural purpose. • License for Cattle Feed purpose. • License for any other purpose. 3 M-III License for sale of Molasses 4 M-III-A License for purchase possession or use of Bago Molasses for purpose of Cattle field. 5 M-IV License for Import of Molasses. 6 M-V License for Export of Molasses. Units & their Supervision

S.No Licenses Officer allocated with the duties of supervision 1 Primary & IMFL Units., Breweries and Wineries, Separate establishment for every such unit was M1, M2 Licenses of Captive appointed. i.e. D.O/B.O., and Staff units 2 Industrial Units, i.e. RS.III, Excise Officer, Industries attached to the Asst. L1, L2, L3 DSX1 units Commissioners of Distilleries 3 Other units i.e. RSII, other Concerned SHOs where the unit is existing and Excise DS Licenses Molasses units Unit officer. and Methonol units. Government of Andhra Pradesh Prohibition & Excise Department Overview of the Department • The Prohibition & Excise Department is a major regulatory department. The Department implements A.P. Excise Act, 1968, A.P. Intoxicating Liquors (Prohibition of Advertisements), 1978, NDPS Act, 1985, A.P. Regulation of Trade in IMFL & FL Act, 1993, A.P. Prohibition Act 1995 and Rules made there under. • Its major responsibilities are:  To regulate production, sale, transportation and usage of intoxicants and alcoholic preparations both for potable and industrial purposes.  To control crime such as illicit distillation, spurious liquor, non-duty paid liquor, adulteration of toddy and crime related to narcotic drugs & psychotropic substances.  To regulate drawl and sale of toddy and neera.  To undertake awareness campaigns against the evils of consumption of intoxicants and narcotic & psychotropic substances, in tune with Article 47 of the Constitution of India.  Revenue generation is incidental to such regulation and the department has the responsibility to ensure that there is no revenue pilferage. Organizational Structure Commissioner of Prohibition & Excise

DOE Addl. CPE JC (Admin) JC (Dist)

DC AS 5 teams AS (Enf) AO LAPP AS (HQ) AS (Dist) AS (Label) (Comp) (Ser)

Control Secs Sec Secs Sec D Secs G&H Room A & B E & F A, B, C

Depty. ACs (D) ACs (13) Comm (13) (3)

ESTF P&ESs Wholesale Depots DOs, BOs ESTF Teams (29) (28) EOs,

Check Posts SHOs Mobile Parties (18) (31) (208)

Enforcement Wing Executive Wing Distillery Wing

Note: - H.Q - Field Wings of the Department • Deputy Commissioner is the district head & responsible for the district administration. Executive • Within the revenue district, there are 2 to 3 excise units each headed by Prohibition and Wing Excise Superintendent. • There are 29 excise units and 208 Prohibition & Excise stations in AP

• Headed by an IPS officer of DIG cadre designated as Director of Enforcement (DOE) • One Assistant Commissioner of Prohibition & Excise represents the Enforcement Wing in each district. He/she has an enforcement team comprising of Assistant Prohibition & Excise Superintendent, 2 to 3 Prohibition & Excise Inspectors and Prohibition & Excise Sub- Enforcement Inspectors, Prohibition & Excise Head Constables and Prohibition & Excise Constables Wing • The State Task Force (STF) with 2 police teams and 3 excise teams works directly under DOE and is meant for detection and investigation of cases, particularly of those having inter-state ramifications. • The wing has a total working force of 302.

• CPE is assisted by JC (Dist), at the H.Q., in the administration of Distilleries & Breweries. • 3 Assistant Commissioners of Distilleries at Zonal level (Kakinada, Vijayawada and Tirupathi) supervise the functioning of distilleries, breweries & other alcohol consuming units. Distillery • 5 Regional Proh. & Excise Laboratories, one each at Visakhapatnam, Kakinada, Guntur, Wing Kurnool and Chittoor, ensure quality control and furnish reports which also serve as expert evidence. • The wing supervises the functioning of 20 IMFL manufactories, 14 primary distilleries and 3 breweries.

Department Work Force Details – Cadre Wise

S. No Cadre Sanctioned Working Vacant S. No Cadre Sanctioned Working Vacant 01 Cadre Posts 3 2 1 Proh. & Excise Sub 18 553 483 70 02 Addl. Commissioner 1 1 0 Inspector Senior Cooperative 03 Joint Commissioner 3 3 0 19 6 5 1 Inspector 04 Dy. Commissioner 16 12 4 20 Head Constable 697 667 30 05 Asst. Commissioner 21 21 0 21 Constable 3405 2472 933 Asst. Secretary (Ser) 06 1 1 0 Spl. Grade Dy. Collector 22 Senior Assistant 110 89 21 07 Joint Director (Tech) 1 0 1 23 Junior Assistant 460 272 188 08 LAPP 1 1 0 24 Accounts Officer 1 1 0 09 Proh. & Excise Supdts. 48 48 0 25 Auditor / Accountant 9 2 7 10 Asst. Secretary (Dist) 1 0 1 26 Typist/Steno 54 4 50 Asst. Excise 27 APPs 14 12 2 11 68 26 42 Superintendent 28 Police Personnel (DSPs) 2 2 0 12 Chemical Examiner 5 2 3 29 Police Personnel (CIs) 2 2 0 13 Asst. Chemical Examiner 16 13 3 30 SARCPL 83 46 37 14 Staff Officer 5 5 0 31 CDI/DI/ADI 4 1 3 15 Asst. Accounts Officer 13 11 2 32 Drivers 52 1 51 16 Proh. & Excise Inspector 400 391 9 33 Last Grade 97 32 65 17 Office Superintendent 26 25 1 34 Outsourcing 94 85 9 Total 6272 4736 1536 Shop Policy (2017-19)

• Govt. issued Shop Policy for 2017-19 vide G.O.Ms.No.113 Revenue (Ex-II) Dept. dated 22.03.2017.

• Number of Shops fixed is 4380; no change in the number of Shops since 2005-06.

• The license period is (2) years, which is coming to an end on 30.06.2019.

• Allotment of shops by drawl of lots in case of more than one applicant. A reserve applicant is also selected to meet the eventuality, if any, of failure by the applicant selected first to establish the Shop.

• For the first time, online filing of applications introduced to ensure transparency.

• One person-one Shop allotment only.

• Applications shall be accompanied by challan / DD of Rs.5000/- towards application fee and Rs.50000/- (Mandal Shops), Rs.75000/- (Nagar Panchayat & Municipality Shops) or Rs.1,00,000/- (Municipal Corporation Shops) towards non-refundable registration charge for participating in the selection process. Shop Policy (2017-19)

• Selected applicant can establish his Shop anywhere in the Mandal / Nagar Panchayat / Municipality / Corporation. This eases selection of premises and establishment of Shop.

• The Commissioner of Proh. & Excise may grant shops to Hybrid Hyper Malls and Cooperative societies and Govt. owned Corporations with a view to modernizing retailing of IMFL & FL.

• The Shop must be 100 Mts. away from educational institutions recognized by the Govt., registered places of worship like temple, mosque or church and 30 bedded hospitals.

• Shop premises shall not be situated within 500 Mts. from national / state highways except in Municipal areas. In case of areas comprised in local bodies with a population of 20000 or less the distance restriction in respect of highways is 220 Mts.

• Permit rooms are mandatory for all shops to prevent drinking in public. The license fee and the registration charge for a permit room are Rs.10,000/- and Rs.5 lakhs respectively. Shop Policy (2017-19) • The licensee has to pay Rs.5 lakhs towards non-refundable re-registration charge at the end of the first year. This is to recoup the revenue loss arising out of non notification of shops at the end of the 1st year.

• All the shops shall install HPFS (Hedonic Path Finder System) which enables “track and trace” of liquor bottles.

Population slab License fee p.a. (Rs. lakhs) Fixed license fee is

charged basing on Upto 5,000 7.50

populations slabs. The Above 5,000 upto 10,000 8.50

adjacent table shows Above 10,000 upto 25,000 9.25 the details: Above 25,000 upto 50,000 10.00

Above 50,000 upto 3,00,000 11.25 Above 3,00,000 upto 5,00,000 12.50 Above 5,00,000 16.25 • The license fees have been reduced to 25% of the previous year’s fee structure and the retailer margin has also been reduced from 21% (Avg.) to 10%. • A new levy by name Additional Excise Duty / Countervailing Duty @36% has been introduced w.e.f. 01.07.2017 so as to recoup the amount foregone due to reduction in license fee Bar Policy (2017-22)

• Bars are permitted in Municipal Corporations including their 5 KM belt, Municipalities including their 2 KM belt, Nagar Panchayats and tourism centers (other than religious tourism centers) and in tourism resorts and beach shacks registered with the Tourism Dept. • Beer and Wine parlors are permitted in Municipal Corporations, tourism centers (other than religious tourism centers) and in tourism resorts and beach shacks registered with the Tourism Dept. • License period of bars increased from 1 year to 5 years i.e. 01.07.2017 to 30.06.2022. • Bars existing as on 30.06.2017 are entitled for grant of licenses for 2017-22. • New bars (85) permitted in Urban Local Bodies including 2 KM belt of Municipalities and 5 KM belt of Corporations where there are no bars or number is inadequate. A population criteria of one bar for 30000 population has been adopted for grant of new bar licenses. • Allotment of bars by drawl of lots except in respect of star hotels, tourism centers and Micro Breweries which are granted bar licenses irrespective of population. • Application fee – Rs.2,00,000/-.

Bar Policy (2017-22)

Specifications / requirements for Bars / Beer & Wine parlours

• Premises with a minimum plinth area of 200 Sq. Mts.; minimum plinth area of beach shack is 100 Sq. Mts. • Kitchen with minimum plinth area of 15 Sq. Mts. • Air conditioning/Air cooling in consumption areas. • Adequate vehicle parking arrangement. • Wash basins / Wash rooms (ladies & gents separately).

Restrictions

• Premises not to be situated within 100 Mts. of educational institutions recognized by Government, places of public worship such as temples registered with Endowments Dept., Mosques registered with Wakf Board, Churches established and managed by registered Christian organization or society and (30) bedded hospitals. • Premises not to be situated within 500 Mts. from predominantly residential areas unless it is located on main road used for shopping purposes. • Premises shall not be situated within 500 Mts. from national / state highways except in Municipal areas. In case of areas comprised in local bodies with a population of 20000 or less the distance restriction in respect of highways is 220 Mts. Bar Policy – License Fees (2017-22)

Non-refundable registration License fee slab p.a. S.No Population charge slab p.a. (Rs.)* (Rs.)*

1 Upto 50,000 8,00,000/- 2,00,000/-

2 50,001 to 5,00,000 18,00,000/- 2,00,000/-

3 5,00,001 and above 28,00,000/- 2,00,000/-

(* Both non-refundable registration charge and license fee are subject to enhancement by 10% every year) Wholesale trade, export & import of IMFL and FL

APBCL Operation Jan ‘94 • From 01.01.1994 to 09.03.2015, the A.P. Beverages Corporation Limited, a State owned company to conducted wholesale trade of IMFL & FL including export and import. Mar ‘15

P&E Dept’s takeover • Due to the attachment orders and restraint orders issued by the Income Tax Dept., the APBCL was forced to stop all trading activities. Govt. authorized CPE to conduct wholesale trade, export and import of IMFL & FL vide • Mar ‘15 G.O.Ms.NO.93 Rev (Ex-II) Dept. dated 10.03.2015. • Accordingly, wholesale trade, export and import of IMFL & FL started by P&E Dept. from 12.03.2015. • APBCL stopped its operations w.e.f. 10.03.2015. Only liquor stocks seized by IT Dept. remained with APBCL.

APSBCL Formation • Govt. permitted for registration of new Corporation vide G.O.Ms.No.272 Rev (Ex-II) Dept. dated Jul ’15 16.07.2015. to • New Corporation, A.P. State Beverages Corporation Limited came into existence on 12.08.2015, Aug’ 15 with the objects of conducting wholesale trade, import, export and retail trade of IMFL & FL among other things. Wholesale trade, export & import of IMFL and FL

APSBCL Operations:

• APSBCL has been entrusted with the job of assisting the P&E Dept. in conducting wholesale trade etc. on a remuneration of 0.5% of issue price of wholesale Depots w.e.f 23.05.2016. • At present 28 wholesale Depots are operating all over State. • APBCL personnel are on deputation with the APSBCL. • Present e-Procurement policies are authorized by the Govt. vide the following GOs:

Policy G.O.

G.O.Ms.No.401 Rev(Ex-II) Dept. dated 14.09.2017 by accepting the IMFL recommendations of the three member Tender Committee constituted vide G.O.Ms.No.369 Rev(Ex-II) Dept. dated 30.09.2015.

Beer G.O.Ms.No.14 Rev(Ex-II) Dept. dated 24.01.2015.

FL G.O.Ms.No.15 Rev(Ex-II) Dept. dated 24.01.2015. IMFL / FL procurement Policy

• The liquor / beer is procured from the Distilleries and Breweries operating both within the State and outside the State on Rate Contract Basis.

• The Dept. issues notifications for procurement of liquor / beer through e-Procurement platform inviting applications for supply of liquor / beer.

• The suppliers will file applications duly quoting basic prices for their products which will be scrutinized and negotiated by a Tender Committee appointed by the Government.

• The recommendations of the Tender Committee will be submitted to the Govt. for approval. After obtaining orders from the Govt., the suppliers will enter into Rate Contract Agreements with the Dept. for supply of IMFL / FL / beer.

• Initially the Rate Contract Agreement period will be one year and extendable upto two years. It can be further extendable with mutual consent of the supplier and the Dept. Existing e-Procurement policies IMFL :

Government issued G.O.Ms.No.401 Rev(Ex-II) Dept. dated 14.09.2017 accepting the recommendations of the three member Tender Committee constituted vide G.O.Ms.No.369 Rev(Ex-II) Dept. dated 30.09.2015 in respect of IMFL.

Beer :

The existing e-Procurement policy of Beer is authorized by the Govt. vide G.O.Ms.No.14 Rev(Ex-II) Dept. dated 24.01.2015 and is under implementation from 25.01.2015. All the rate contract agreements are under extension as per the Government orders issued vide Memo No.25445/Ex-II(2)/2013 dated 08.02.2018. The Government have constituted 3-member Tender Committee vide G.O.Ms.No.369 Rev(Ex-II) Dept. dated 30.09.2015 with Hon’ble Justice (Rtd) Sri R.Ramanujam as Chairman. The Committee has scrutinized the offers conducted negotiations etc., and its report is awaited.

FL :

Present e-Procurement policy of FL is authorized by the Govt. vide G.O.Ms.No.15 Rev(Ex-II) Dept. dated 24.01.2015 and is under implementation from 25.01.2015. All the rate contract agreements are under extension as per the Government orders issued vide Memo No.25445/Ex-II(2)/2013 dated 08.02.2018.

The Government have constituted 3-member Tender Committee vide G.O.Ms.No.369 Rev(Ex-II) Dept. dated 30.09.2015 with Hon’ble Justice (Rtd) Sri R.Ramanujam as Chairman. The Committee has scrutinized the offers conducted negotiations etc., and its report is awaited. Existing Excise Duty Structure

IML Beer

Basic Price per Case ED Rate Basic Price per Case ED Rate Upto Rs.350 Rs.30 PPL* Upto Rs.200 Rs. 5 per BL** Above Rs 350 upto Rs.400 Rs.40 PPL Above Rs 200 upto Rs.250 Rs.9 per BL Above Rs 400 upto Rs.450 Rs.80 PPL Above Rs 250 upto Rs.350 Rs.11 per BL Above Rs 450 up to Rs.525 Rs.85 PPL Above Rs 350 Rs.13 per BL Above Rs 525 up to Rs.575 Rs.90 PPL Above Rs 575 up to Rs.700 Rs.95 PPL RTD Above Rs 700 to Rs.1000 Rs.100 PPL v/v concentration ED Rate Above Rs 1000 to Rs.2500 Rs.105 PPL Upto 5% v/v 9% of Basic Price Higher of Rs.110 PPL or Above Rs 2500 to Rs 3500 Above 5% v/v and upto Rs.1100 per case 12% of Basic Price 8% v/v alcohol Higher of Rs.110 PPL or Above Rs 3500 to Rs 5000 Rs.1100 per case Higher of Rs.110 PPL or Above Rs 5000 * Per Proof Litre Rs.1100 per case ** Bulk Litre Existing Excise Duty Structure Wine a) Fruit Wines/ Table Wines (Manufactured in AP)

Basic Price per Case ED Rate

All ranges 5% of Basic Price

a) Wines manufactured within AP other than Fruit Wines/ Table Wines and Imported Wines (from other states)

Basic Price per Case ED Rate Upto Rs.2000 15% of Basic Price Above Rs 2000 Higher of 10% of Basic Price or Rs 300 per case Existing VAT Structure

Basic Price per Case % on LC* Upto Rs.400 140% Above Rs 400 upto Rs.2500 190% IML Above Rs 2500 upto Rs.3500 160% Above Rs 3500 upto Rs 5000 140% Above Rs 5000 130%

Basic Price per Case % on LC Beer Upto Rs.200 150% Above Rs 200 175%

Basic Price per Case % on LC Wine All ranges 100%

Basic Price per Case % on LC RTD All ranges 150% * Landed Cost Distilleries, breweries and IMFL manufactories

Category Number Production Capacity Primary distilleries 32 5072 Lakh BL Breweries 3 2150 Lakh BL IMFL Manufactories 20 3876.4 Lakh PL

• While no new LOIs are granted for IMFL manufactories, the schemes of inviting applications for grant of LOIs for breweries, wineries & primary distilleries are still open. • 5 Regional Proh. & Excise Laboratories, one each at Visakhapatnam, Kakinada, Guntur, Kurnool, Chittoor ensure quality control & furnish reports which serve as expert evidence. • The laboratories will be modernized with the state of art technology with an outlay of Rs 10 Crores. • Allotment of molasses, RS and ENA, renewal of distillery licenses have been made online under Ease of Doing Business. Toddy Administration

Details of toddy shops and tappers:

Shops under Shops under Total shops Total tappers TCS TFT 2344 1980 4324 82622

Important features of Toddy Policy 2017-22:

• Establishment of Toddy shops permitted within 100 Kms of the availability of Excise trees. • Toddy rentals abolished, benefitting tappers to the tune of Rs 3.45 Crores. • Existing ex-gratia scheme dispensed with, all registered tappers to be covered under Chandranna Bhima Scheme. They shall be enrolled under State accident, death and disability scheme, Aam Aadmi Bhima Yojana & Pradhana Mantri Suraksha Bhima Yojana. • Benefits are – Death & total disability Rs.5,00,000/- (Rs.2.25 Lakh + Rs.75,000/- + Rs.2.00 Lakh from the above three Yojanas respectively). • Partial disability Rs.3,62,500/- (Rs.2.25 Lakh + Rs.1.00 Lakh + Rs.37,500/- from the above three Yojanas respectively). • Date/palm trees to be grown extensively under NREGA. Revenue (Component-wise) Rs. in Cr. 2020-21 Component 2017-18 2018-19 2019-20 (upto Feb’2021) License Fee 856.69 622.26 234.10 77.90 Excise Duty 2131.02 2220.37 2079.09 1203.36 Addl. Excise Duty 1260.47 2153.59 2003.18 1069.02 Privilege Fee 955.84 953.30 402.88 99.70 ARET 0.00 0.00 1698.20 7558.90 RET 0.00 0.00 403.80 418.66 Others 556.27 475.67 399.49 186.61 Excise Revenue 5760.30 6425.19 7220.74 10614.15 VAT by Excise 9590.27 10915.00 10405.39 5677.95 Total Revenue 15350.57 17340.19 17626.13 16292.10 Recent changes in the structure of P&E Dept.

• There is a sea change in the structure of P&E Dept. in the recent past.

• A new post Commissioner of Distilleries & Breweries (CDB) has been created with the powers of renewal, allotment of spirits, etc., subject to the overall control of Commissioner of Proh. & Excise.

• The CDB supervises the distillery wing including breweries and RS/DS/ENA utilising units.

• A new wing, Special Enforcement Bureau (SEB) has been created w.e.f. May, 2020 to control all illegal activities relating to sand and liquor. It is headed by an Inspector General of Police cadre officer and junior IPS officers working at District level.

• 70% of the Proh. & Excise personnel have been allotted to the SEB including (208) P&E Stations. Necessary amendments have been made to the Proh. & Excise Laws as well as NDPS Act.

Changes in the Excise policies & structure of P&E Dept.

• There is a sea change in the Excise policies w.e.f. 01.10.2019.

• Pursuant to Government’s policy decision of prohibition in phases, Government has done away with private retailing licenses and granted exclusive privilege to APSBCL to run retail shops and reduce the retail outlets from (4380) to (2934).

• Bars are under private sector, but number reduced from (840) to (530) and the matter is subjudice.

• The CDB supervises the distillery wing including breweries and RS/DS/ENA utilising units. Changes in the Excise policies & structure of P&E Dept. (Contd..)

Creation of Special Enforcement Bureau (SEB) : • A new wing, Special Enforcement Bureau (SEB) has been created w.e.f. May, 2020 to control all illegal activities relating to sand and liquor. Subsequently SEB has been entrusted with the control of crime relating to illegal gaming, betting, gutkha, etc.

• It is headed by an Inspector General of Police cadre officer with junior IPS officers working at District level.

• 70% of the Proh. & Excise personnel has been allotted to the SEB including (208) P&E Stations.

• The post of Director Of Enforcement (DOE) no longer continued in P&E Dept.

• All enforcement powers such as detection, investigation, prosecution, etc., relating to all excise and prohibition cases have been transferred to SEB. A notification has been issued empowering SEB to control crime relating to narcotic drugs and psychotropic substances. Changes in the Excise policies & structure of P&E Dept. (Contd..)

Creation of Special Enforcement Bureau (SEB) :

• Accordingly the excise, prohibition and NDPS laws amended.

• P&E Dept. shall be responsible for regulatory functions such as licensing, collection of revenue, etc., Revenue (Component-wise) Rs. in Cr.

Component 2015-16 2016-17 2017-18 2018-19 2019-20 2020-21 (upto Feb’2021) License Fee 2063 2159.63 856.69 622.26 234.10 77.90 Excise Duty 1860.3 1997.19 2131.02 2220.37 2079.09 1203.36 Addl. Excise Duty 0.00 0.00 1260.47 2153.59 2003.18 1069.02 Privilege Fee 114.77 406.80 955.84 953.30 402.88 99.70 ARET 0.00 0.00 0.00 0.00 1698.20 7558.90 RET 0.00 0.00 0.00 0.00 403.80 418.66 Others 348.16 381.04 556.27 475.67 399.49 186.61 Excise Revenue 4386.23 4944.66 5760.30 6425.19 7220.74 10614.15 VAT by Excise 8088.5 8649.1 9590.27 10915.00 10405.39 5677.95 Total Revenue 12474.73 13593.76 15350.57 17340.19 17626.13 16292.10 Changes in the Excise policies & structure of P&E Dept.

• There is a sea change in the Excise policies w.e.f. 01.10.2019.

• Bars are under private sector, but number reduced from (840) to (530) and the matter is subjudice.

• A new post, Commissioner of Distilleries & Breweries (CDB) has been created with the powers of renewal, allotment of spirits, etc., subject to the overall control of Commissioner of Proh. & Excise.

• The CDB supervises the distillery wing including breweries and RS/DS/ENA utilising units. Changes in the Excise policies & structure of P&E Dept. (Contd..)

• It is headed by an Inspector General of Police cadre officer with junior IPS officers working at District level.

• 70% of the Proh. & Excise personnel has been allotted to the SEB including all (208) P&E Stations.

• The post of Director Of Enforcement (DOE) no longer continued in P&E Dept.

• All enforcement powers such as prevention and detection of crime, investigation and prosecution, etc., of cases relating to all excise and prohibition have been transferred to SEB. A notification has also been issued empowering SEB to control crime relating to narcotic drugs and psychotropic substances. Changes in the Excise policies & structure of P&E Dept. (Contd..)

Creation of Special Enforcement Bureau (SEB) :

• Accordingly the excise, prohibition and NDPS laws amended.

• P&E Dept. is discharging regulatory functions such as licensing, supervision over functioning of bars, toddy shops, distilleries, breweries, collection of revenue, etc. Organogram - P&E Dept. Organogram – Special Enforcement Bureau THANK YOU