Wine-by-the-glass off the Lists in Kolkata

Wine-by-the glass is a basic concept where the consumer can order only a glass of wine instead of the full bottle that may not be practical. In fact, it is a common practice in most parts of India and delWine strongly recommends service by the glass with wine, stored properly once the bottle is opened. However, it appears that due to inexplicable reasons, Kolkata has its own laws that say wine, beer and RTD by the glass may not be served.  Whiskey and other hard liquors are allowed, however. Interestingly, no importer or retailer has confirmed receiving the order in writing.

If the question were of weights and measures, it would be quite understandable. But why only on wine and beer and not liquor, one wonders. It’s so easy to define the standard pour (125 mL or 150 mL as a standard practice) and issue orders to have a peg measure as is being done for whisky etc.

According to an erstwhile distributor in Kolkata, now a promoter (distributors were eliminated last April 1 when alcohol distribution model was changed into a state monopoly in the form of West Bengal State Beverages Corporation Ltd., commonly known as Alcobev Corporation), the whole of West Bengal is not affected. There was a clause in the earlier licenses issued decades ago that stipulated this requirement. In practice, the licenses were simply renewed. It was never followed but recently the anomaly was spotted by the excise department which warned the licensees about fines to be imposed for breaking of this law. In fact, one licensee has been already fined Rs. 50,000 or at least a warning has been given, according to our sources. 

However, our sources have confirmed that there has been a meeting with the Commissioner last week and he has offered to look at the issue pragmatically. Till that time the Sword of Damocles is hanging over their head. 

This is not the only problem currently faced by the wine importers and promoters (a relatively new entity that invests money in the business and thus become a promoter who is allowed to deal with the State Monopoly).  Since the system was incorporated last year, there have been many other irritants that cause procedural delays. For example some of the depots have a lack of resources to handle the work load of processing orders and there are frequent backlogs. A temporary solution has been found by allowing only one consolidated order a day. Besides, no orders may be punched two days in a row. This implies that if there is a sudden requirement, you may not be able to execute the order; and this includes big retailers like Spencer’s.

The merchants are still suffering from the losses because of Label Registration charges increased to Rs. 50,000 last year on BIO wines. When the trade created a furore, it was later brought down to Rs. 15,000 during the mid-season.

In West Bengal, the government took charge as distributor of wine and alcohol with 4.5% margin on the MRP last year in April. It might be recalled that Karnataka which started the monopoly distribution as a State, used to charge 8% initially but it has been brought down to 0.5% now. Incidentally, Karnataka is considered the best model in India from the point of view of distribution for the government, importers and customer alike as it is practically corruption free and is smooth running. In Kolkata, the Retailers are also unhappy as their earlier margins of 9% have been brought down to less than 7%.

Sales tax and excise duty have also been merged at a total of  increased amount at 32%. Add to that the alcobev corporation’s  margin of 4.5%, and the amount of 36.5% levied by the Corporation has to be deposited with the government before selling a single bottle-thanks to these charges being shifted to first-point.

Hopefully, the Commissioner understands the hardship this step is causing to the industry. Till then the importers have to suffer in Kolkata, like Delhi has to suffer the heat.

Subhash Arora

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