Online trading of alcoholic liquors in India
Sir, I want to build an online beer store with a simple business plan: Users will come to my website, choose the products they want to buy, opt for cash on delivery. As per the user’s delivery address the nearest beer store would get a notification of the order details and the store would take the responsibility of delivering the order along with verifying the legal drinking age of the recipient at the time of delivery.
So the online platform won’t do anything except taking orders on behalf of a real beer store and passing the information to it, and charge the store for some commission for it’s service. Now suppose this website will only serve Pune in the beginning. Would this whole thing be legal?
According to entry number 51, seventh schedule of our constitution state has right to collect excise duties on liquor. Entry no 51 read as : Duties of excise on the following goods manufactured or produced in the State and countervailing duties at the same or lower rates on similar goods manufactured or produced elsewhere in India:-
- Alcoholic liquors for human consumption;
- Opium, Indian hemp and other narcotic drugs and narcotics, but not including medicinal and toilet preparations containing alcohol or any substance included in sub-paragraph (b) of this entry.
So when you start online trading of liquor product then you have to get license from each states. Some states have syndicate and some have separate contract with each licensee. When product moves from your site (payment made) then excise duty should be levied on the initiation of movement.
But in your case payment will be done on your site and product will be delivered from different locations of India so at which place duties shall be levied ? This is the main hurdle in your business. If duties are levied on your portal then you need license for this business (trading of liquor without license is an offence) and right now there is no rule to issue license for online trading of alcoholic liquor.
Shivendra Pratap Singh
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