HC orders status quo on Chandigarh liquor vends, puts UT on notice

The Punjab and Haryana High Court on Wednesday issued a notice of motion to the Union Territory of Chandigarh for April 3 while ordering the maintenance of status quo on a bunch of three petitions challenging the liquor vends tendering process in Chandigarh.

As the matter came up for preliminary hearing, the Bench of Justice Sureshwar Thakur and Justice Vikas Suri orally observed that allocation of even 10 vends to a single entity was against the provisions of the Competition Act, which aims to prevent practices that harm competition, promote fair trade, and protect consumer interests.

The observations followed submission that a single family and their associates had secured 87 out of 97 vends. One of the petitions was filed through advocate Bikramjit Singh Patwalia, while senior advocates Chetan Mittal and Puneet Bali argued the matter before the court. The development is significant as the existing vends will continue till March 31, but the allocation of vends through the tendering process will not be given effect to.

The Chandigarh liquor vends tendering process for 2025-26 came under judicial scrutiny after a contractor alleged cartelisation and non-compliance with the excise policy. One of the petitions contended that the tendering results revealed that over 87 out of 97 vends had been allocated to just two or three individuals operating under different firm names or through their relatives, associates, and employees.

Challenging the notice inviting tender (NIT) dated March 13, petitioners M/S Kler Wines and another, through counsel Patwalia, argued that the entire process had been conducted in contravention of prescribed rules. Seeking the quashing of the NIT, he asserted that the flawed process violated the Excise Policy 2025-26 and the Punjab Liquor Licence (Chandigarh Amendment) Rules, 2020.

Patwalia emphasised that policy restrictions clearly prohibited any individual, firm, or company from acquiring more than 10 liquor vends to prevent cartelization and monopolization. However, the respondents had allowed certain individuals, through their family, associates, and employees—forming a group of nearly 11 members—to bypass the restriction and gain disproportionate control over the liquor trade in the city.

Going into the legality of the issue, Patwalia pointed out that Clause 14 of the Excise Policy explicitly mandated that any entity forming a monopoly or cartel to dominate the liquor trade must be treated as a single entity and subjected to the maximum allocation limit of 10 vends. The Chandigarh Administration’s failure to enforce this provision had enabled private respondents to accumulate excessive control over liquor distribution.

It was further submitted that the tendering process had lacked transparency and was not conducted in accordance with the law. The Excise Policy was framed to ensure fair distribution of liquor vends and prevent monopolization. However, the tendering process allegedly allowed select individuals or entities to bid in proxy, defeating the very purpose of the policy.