Date:23/02/2006 URL: http://www.thehindubusinessline.com/2006/02/23/stories/2006022301991900.htm

Back AP to amend Excise Act

Our Bureau

The move is aimed at plugging loopholes in the tax collection mechanism and categorising different varieties of liquors.

Hyderabad , Feb. 22

THE Andhra Pradesh Government is set to amend the State Excise Act, 1968 and related enactments, which would mean redefining liquor.

The move is aimed at plugging loopholes in the tax collection mechanism and categorising different varieties of liquors.

The amendment, which was moved in the State Legislative Assembly here on Wednesday, by the State Minister for Commercial Taxes, Prohibition and Excise, Mr Konathala Ramakrishna, seeks to redefine Indian Liquor and broaden its scope in applicability by introducing a new definition in the form of Indian-made foreign liquor (IMFL).

According to statement of objects and reasons, Indian liquor in terms of the State enactment means a liquor produced, manufactured or compounded in India.

This is similar to the manner in which gin, brandy, whisky, rum imported from foreign countries and includes milk punch and other liquors consisting of or containing any such spirits, but does not include foreign liquor.

To this, wine and beer were included through the amended Andhra Pradesh Act 35 of 2005.

The definition indicates that Indian liquor is that which is not country liquor or liquor manufactured and imported from foreign countries.

It meant that liquors like gin, brandy and whisky or rum are not native to this country and that they originated in other countries and hence are popularly known as Indian-made foreign liquor.

Even though beer is not native to this country, it is manufactured and sold and consumed is a form of fermented liquor usually made from malt and includes other ingredients.

Therefore, it was felt appropriate to change the definition of Indian liquor to that of Indian-made foreign liquor and to include all liquor manufactured or compounded in India that are not native to this country.

Interestingly, this is assuming the role of a retrospective effect from November 1, 1969, to give it a greater clarity.

The move is aimed at safeguarding and ensuring proper collection of this source of revenues, and it is proposed to bring clarity by declaring all amounts to be collected as margin money.