Karnataka High Court declared that online sale or home delivery of liquor either for oneself or as an agent is not permissible in the state under the Karnataka Excise Act, 1965.
The verdict of banning the online sale or home delivery of alcoholic beverages in the state was delivered by HC Justice S Sujatha. Justice Sujatha also dismissed a petition filed by a Chennai-based company HipBar Pvt Ltd.
The Reserve Bank of India (RBI) had granted wallet licence to HipBar in 2017 under the Payment and Settlement Systems Act, 2007 to the company to sell only booze online. The company was using a semi-closed payment system (mobile wallet) and the issued license is valid till September 2021.
But after a news channel report on the company, the Karnataka government had withdrawn the Letter of Authority (LoA) granted to HipBar for online order and delivery of Indian and foreign liquor without issuing show-cause notice on November 2018.
According to the reports, HipBar had sought a declaration from the court that online ordering and liquor delivery to the consumers does not require a licence under the state Excise Act as the company is not engaged in liquor sale. Rather it is acting as a medium between a licensed merchant and consumer through a digital wallet payment.
Justice Sujatha observed that "Indisputably, liquor is deleterious to the health of mankind. The social stigma attached to it as far as the family and society are concerned cannot be lost sight of. Younger generation including children below the permissible age succumbing to this temptation of liquor consumption may not be stringently regulated through online orders. The eligibility of age and sound mind to receive and consume liquor is difficult to monitor with the trade carried out by the petitioner-company," reports Live Law.
The HC also noted that there are various types of licences one needs to have to store, manufacture, sell, possess and transport liquor. "Hence, it is illegal if any sale or purchase is made through any other mode than prescribed under the Act, 1965, in Karnataka. It is only the licence holders who are entitled to sell the liquor," the court observed.
Another retailer in Bengaluru Madhuloka liquor boutique also used to operate online sale of alcoholic beverages. They own several stores across the city but has stopped selling liquor through their online portal.
However, it is alleged that several illegal portals still continues to sell liquor online and there several stores across the city which provide home delivery.
