Tippler’s paradise—the City Beautiful—seems to have lost its edge over the neighboring states of Punjab and Haryana in selling cheap liquor.

From May 1 onwards, the liquor prices would soar up by upto 30 percent making prices in Chandigarh on par with neighboring Punjab and expensive than Haryana.  As of now, the liquor rates in Chandigarh have been cheaper than Haryana and Punjab.

Given the lukewarm response during liquor vends auction organized on Tuesday and dwindling liquor consumption in the city, the UT Administration is now paying dearly for the ill-conceived excise policy.

Chandigarh, which was earlier seen in the league of top liquor guzzling cities, has witnessed a surprising fall in liquor consumption in the previous two years.

This has largely been for the fact that people living in neighbouring towns of Punjab and Haryana used to buy liquor from here as this used to be cheaper. They no longer do it.

The higher cost of liquor, higer excise duty, higher license fee for allotment of liquor vends…remains the major factors resulting in declining liquor consumption and also affecting excise revenue generation.

The excise policy adopted by the UT Administration in the fiscal year 2011-12, has completely  Chandigarh’s liquor culture. After this, the liquor prices climbed up and auction process was adopted for the allotment of liquor vends.  In the last two fiscal years, the licence fee, excise duty, permit fee, import fee, assessment fee on liquor was enhanced in Chandigarh.

As per the records with the UT Excise and Taxation Department, the boozers gulped up about 4.8 crore bottles of liquor in fiscal 2011-12 which came down to around 4.3 crore liquor bottles in financial year 2012-13.

Prior to this, the small city of Chandigarh with a population of only 10.54 lakh people was guzzling over 5.50 crore liquor bottles on an average every year.  With escalating liquor prices in last two years,

The UT also managed to keep check on inter-state smuggling of liquor from Chandigarh which reduced the profit margins of the sellers in Chandigarh.

Over the years, the UT excise policy was encouraging liquor smuggling from Chandigarh due to low prices of liquor as compared to Punjab and Haryana. But, now with substantial hike in liquor prices and high license fee of liquor vends, the entire burden has been put on consumers and the small dealers.

The union territory of Chandigarh has 217 liquor vends including 152 Indian made foreign liquor vends and 65 country liquor vends. Come May 1, the decked up and well lit pre-fabricated roadside liquor vends, which was the highest revenue generating vends would also be removed.

These 32 pre-fabricated structures were well-known for attracting hundreds of boozers from adjoining states of Punjab and Haryana.

The UT had invited bids for the same on the condition that the Excise and Taxation Department will not be responsible for providing space for opening the liquor vends and owner will have to shift the vend at other places. Not a single bid was received for the same.

Due to higher license fee of liquor vends, the auction of vends held on Tuesday sprung up a number of surprises for the UT Excise Department.

It was for the first time that the UT could not auction over 52 percent (114) out of the total 217 liquor vends during the opening of financial bids for the allotment of liquor vends under the Excise Policy 2013-14.

According to the UT senior officials, the UT Administration would bear huge financial loss due to the removal of pre-fabricated liquor vends.

Also, with half of the liquor vends yet to be auctioned, UT officials apprehend that the projected revenue can be less as compared to last year’s projections of Rs 250 crore.

A UT official said, “Due to the higher license fee of liquor vends, the auction witnessed poor response. In last two years, the liquor consumption has declined significantly in Chandigarh.

And, the small dealers have faced losses due to the high license fee and declining sale of liquor.