The recent lottery system for liquor shop licenses in Telangana has turned out be a big money-spinning racket, as winners, many of them ordinary applicants, are selling or leasing their licenses for crores to established liquor syndicates.
According to reports in a section of media, those who won the bids in the liquor shop actions by paying Rs 3 lakh deposit, are selling their licences to the liquor syndicates at a premium, ranging from lakhs to even a few crores of rupees.
For example, a housewife who applied for a liquor license by paying Rs 3 lakh became an overnight millionaire after winning the draw in Greater Hyderabad.
A major liquor trader allegedly struck a deal to buy the license for Rs 1.5 crore, leaving her with a windfall profit.
In Mancherial district, a group of seven friends applied for 15 shops. The syndicate bagged five licenses and sold two of them for Rs 85 lakh each and three for Rs 3 crore each.
Similarly, a family in Nalgonda district that secured two shops reportedly sold both for Rs 2 crore.
Officials admit privately that though transferring or renting licenses violates excise norms, the practice has become rampant.
The excise department recently completed its lottery process for new licenses valid from December 1, when the previous two-year term ends.
Many applicants, including housewives, retired employees, and jobless youth, are applying with the sole aim of flipping the licenses for a profit.
With just a Rs 3 lakh non-refundable application fee, they hope for a “life-changing lottery win.”
Across Greater Hyderabad, hundreds of licenses have been leased for Rs 1 crore to Rs 1.5 crore each, while in district headquarters and towns, deals range between Rs 80 lakh and Rs 1 crore.
In Khammam, a shop clerk who borrowed Rs 3 lakh for the application hit the jackpot, selling his license for Rs 1.10 crore.
In Suryapet, a trader swapped his allocated shop with another due to better business prospects, paying an extra Rs 50 lakh as part of the deal.
Excise rules clearly prohibit anyone other than the license holder from operating a liquor outlet. However, the system has become a shadow market, with authorities allegedly turning a blind eye.
Analysts warn that if any untoward incident occurs in these outlets, the legal responsibility will still lie with the original license holder.
