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Excise Officials work overtime to ensure Bengaluru doesn’t go dry

eNarada, Bengaluru, September 4, 2016

It was a long weekend for Bengalureans and many were planning to go out of the city. However, the officials working in Karnataka State Beverages Corporation Limited (KSBCL) were asked to cut down their holidays and report to work immediately on Sunday! Reason, the officials were asked to disperse the liquor stocks pending at their Depots immediately failing which Bengaluru could have gone dry in the next few days!

Wine store 1

Sources in the KSBCL said the daily wage labourers who are responsible for Loading and unloading liquor cartons at KSBCL Depots  had gone on a strike. Their grouse was that they were paid Rs 2.5 per carton from the manufacturers/ importers and a meagre Rs 1.5 per carton from the outlets owners. Citing examples of neighbouring Tamil Nadu where labourers were paid Rs 6 per carton, the labourers working in KSBCL too demanded a hike. However, the outlet owners refuse to increase the wages and as a result, the stocks were not lifted for the last few days. The labourers were rallying around Magadi MLA HC Balakrishna to press for their demands. However, last minute parleys convinced the labourers to report to work as they didn’t want to lose out revenue during the festive season.

Excise revenue is the second largest source of revenue in the state. Despite various administrative measures from time to time a general perception prevailed prior to 2003 that the State has not been able to maximise revenue collections from this source due to evasion of duty. Such a view has also been voiced in the report of the tax reforms commission. Considering the potentiality of garnering additional revenue, Karnataka Government initiated a set of reforms in June 2003, which broadly consisted of reduction and rationalisation of excise duty structure, simplification of procedures and establishment of a State Government-owned distribution company for canalisation of IML, beer and spirit.

Thus, Karnataka Chief Minister SM Krishna’s pet project of KSBCL emerged as a private limited company of the Government of Karnataka on June 2, 2003 for the purpose of canalising sale of liquor in the State and commenced operations from July 1, 2003. It was a decisive step to curb evasion of excise duty and the menace of non-duty-paid second or third sales.

As a canalizing route, the manufacturers, both within and outside the state, keep their stocks in the corporation’s godowns across the State for distribution to wholesale licensees till the end of June 30, 2006 and effective from July 1, 2006 the distribution is made to the retail and other licensees subsequent to abolition of wholesale business. To self-sustain its activity, the Corporation is collecting a margin on the goods transacted as prescribed by the Government of Karnataka. Initially the distribution was confined only to IML and beer and later the government entrusted the partial canalisation of rectified spirit with effect November 1, 2003 and subsequently a total canalization of spirit was implemented with effect from September 1, 2004.

The corporation operates its activity through 66 liquor depots located in all districts and for handling spirit operations, 38 depots have been established in all the functioning primary distilleries. Spirit depots obtain delivery from the primary distillery for delivery to the buyers. All depots are equipped with suitable IT infrastructure which enables data transfer between depot and head office through electronic mode and all critical activities are automated. The activities of the corporation are managed by 411 employees drawn from certain state PSU’s, and 52 contract employees.

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