Chapter IV CONTROL, REGULATION AND EXEMPTION

The State Government may, by notification, exempt any person or any class of persons from any of the provisions of this Act. (1) The State Government may, by notification and subject to such conditions as it thinks fit, direct that,-

(a) any preparation containing alcohol not exceeding a specified percentage by volume, or

(b) any liquor or intoxicating drug or preparation containing such liquor or drug, and required for medicinal, scientific, industrial or such like purpose, or

(c) members of the Armed Forces of the Union or of any other Armed Forces raised or maintained by the Union or attached to or operating with any of its Armed Forces:

shall be exempt from any of the provisions of this Act or rules, regulations or orders made thereunder.

(2) When issuing a notification under sub-section (1), the State Government shall have power to provide that a breach of any of the conditions subject to which the exemption is notified, shall be punished with imprisonment which may extend to six months or with fine which may extend to Rs. 1,000, or with both.

The Commissioner may,-

(a) establish a distillery in which spirit may be manufactured in accordance with a licence issued under this Act on such conditions as the State Government deems fit to impose;

(b) discontinue any distillery established;

(c) license, on such conditions as the State Government deems fit to impose, the construction and working of a distillery or brewery;

(d) establish or license a warehouse wherein any liquor, intoxicating drug, hemp, mhowra flowers or molasses may be deposited and kept without payment of duty; and

(e) discontinue any warehouse so established.

(f) license on such conditions as the State Government deems fit to impose the manufacture of liquor or any intoxicating drug by any person.

No liquor, intoxicating drug, hemp, mhowra flowers or molasses shall be removed from any distillery, warehouse or other place of storage established or licensed under this Act, except under a pass and unless the duty, if any, imposed under the provisions of this Act, has been paid or a bond has been executed for the payment thereof.

No person shall import, export or transport any intoxicant except under a pass. (1) The Commissioner, or a Deputy Commissioner, or any other officer authorised by the State Government may grant passes for the import, export or transport of any liquor, intoxicating drug or hemp.

(2) Such passes may be either general for definite periods of time and definite kinds of liquor, intoxicating drug or hemp, or special for specified occasions and particular consignments only.

(3) Every such pass shall specify—

(a) the name of the person authorised to import, export or transport liquor, intoxicating drug or hemp;

(b) the period for which the pass is to be in force;

(c) the quantity and description of liquor, intoxicating drug or hemp for which it is granted; and

(d) the places from and to which liquor, intoxicating drug or hemp are to be imported, exported or transported, and in the case of places more than ten miles apart, the route by which they are to be conveyed.

No person shall import or export any through consignment except under a pass. The through transport of any consignment of any intoxicant, hemp, mhowra flowers or molasses by a railway

The State Government, or, subject to its control, the Deputy Commissioner, may grant licences for the possession of denatured spirit, rectified spirit, and alcohol for industrial or medicinal purposes, if such spirit or alcohol is, in the opinion of the State Government or the Deputy Commissioner, as the case may be, necessary for scientific, industrial, medicinal or similar purposes: Provided that no licence shall be necessary for the possession of denatured spirit to the extent of such quantity as may be prescribed by rules. (2) When a licence is cancelled under sub-section (1), a part of the licence fee proportionate to the unexpired portion of the term of such licence and the deposit made by the licensee in respect of such licence shall be refunded to him after deducting the amount due from him to the State Government.

Licences may be issued to persons for bona fide medicinal, scientific or industrial purposes. The State Government, or, subject to its control, the Deputy Commissioner, may grant licence to any person or in respect of any institution, whether under the management of Government or not, for the manufacture, export, import, transport, sale, possession, consumption or use of liquor, any intoxicating drug or hemp or any article containing liquor, intoxicating drug or hemp on the ground that such liquor, intoxicating drug, hemp or article is required by such person or in respect of such institution for a bona fide medicinal, scientific, industrial or such like purpose, or for sale, for any of the aforesaid purposes: Provided that when any liquor, intoxicating drug, or hemp has been obtained by any person for a bona fide medicinal purpose from any person or institution, licensed to sell the same under this section, it shall not be necessary for such person to obtain a licence for the possession, consumption or use of the same.

A licence is required for the purchase of liquor for the manufacture of medicinal or other preparations under section 16. The State Government, or, subject to its control, the Deputy Commissioner, may grant licences for the purchase, possession or use of any liquor or alcohol for the manufacture of any article mentioned in section 16.

Subject to the control of the State Government, the Deputy Commissioner or any officer empowered by him, may grant,- (a) licences for tapping of, or drawing juice from, any palm tree for the purpose of sale or consumption as sweet toddy or neera or for the manufacture of jaggery or any other article which is not an intoxicant; or (b) permits for the possession, transport or sale of such sweet toddy or neera.

(1) The State Government, or, subject to its control, the Deputy Commissioner, may issue licences to any person for tapping of trees for toddy in any area specified in such licence and for the possession, manufacture, transport and export of such toddy. (2) The provisions of the Mysore Excise Act, 1901, or any corresponding law in force in any area of the State, and the rules made thereunder, shall, notwithstanding anything contained in this Act, apply to the tapping of trees for toddy and the possession, manufacture, transport and export of toddy licensed under sub-section (1).

Licences for the trade in alcoholic preparations may be issued. The State Government, or, subject to its control, the Deputy Commissioner, may grant trade and import licences to persons intending to import and to sell by wholesale any liquor, intoxicant drug or hemp.

Licences may be granted to vendors for the sale of alcohol for approved purposes. The State Government, or, subject to its control, the Deputy Commissioner, may grant a vendor’s licence subject to the following conditions:— (i) the stock of foreign liquor with the licensee (except what is permitted for disposal in the shop) shall be kept by him at a warehouse approved by Government; (ii) the licensee shall be allowed to select his own warehouse and fix its rent with the owner: Provided that on failure to select such warehouse, the warehouse shall be selected by the licensing authority; (iii) the licensee shall pay all rents, costs, charges and expenses incidental to warehousing and supervision; (iv) the licensee may sell any part of the stock of foreign liquor to licensees in the State or to any persons outside the State, subject to such conditions as the Commissioner may prescribe; (v) the licensee may sell only to holders of permits or authorisations; (vi) the licensee shall be entitled to keep in his shop such quantities of liquor as may be permitted by the licensing authority from time to time for retail sale; (vii) the licensee shall keep account and shall dispose of the goods according to such instructions as may be given by the Commissioner or any officer authorised in this behalf by the Commissioner.

Ships may be issued licences to possess and serve foreign liquor. The State Government, or, subject to its control, the Deputy Commissioner or any other officer authorised by rules or an order in writing by the State Government, may grant licences to any shipping company for each ship or to the master of any ship to sell foreign liquor and permit the use and consumption of foreign liquor on such ship on such conditions as may be prescribed.

The State Government may, on such conditions as may be specified by a general or special order, permit,- (i) the sale of foreign liquor to, or (ii) the purchase, use or consumption of such liquor by,- (a) the members of the Armed Forces in messes and canteens, (b) the crew of war ships or troop ships and the members of the Armed Forces thereon.

Permits may be granted to foreigners residing temporarily in India. (1) The State Government, or, subject to its control, the Commissioner, the Deputy Commissioner or a Committee appointed for the purpose, may grant permits to persons for the use or consumption of foreign liquors for such quantities as may be prescribed subject to the following conditions:— (a) that such person is not a minor, and (b) that such person was either born and brought up or domiciled in any country outside India, where such liquor is being used or consumed or such person is on the Register of Foreigners, maintained under the Registration of Foreigners’ Act, 1939, and is not domiciled in India: Provided that, in the case of any person falling under clause (b), such person has been residing and intends to reside in India temporarily and that such person has a fixed and settled purpose of making his sole and permanent home in any country outside India and that such person has been ordinarily using or consuming such liquor. (2) If any question arises whether the conditions imposed by clause (a) or (b) of sub-section (1) are satisfied or not, in any case, the State Government shall decide the question and its decision shall be final.

(1) The State Government, or, subject to its control, the Deputy Commissioner, may grant a health permit for the use or consumption of liquor to any person who requires such liquor for the preservation or maintenance of his health: Provided that no such permit shall be granted to a minor. (2) Such permits shall be granted for such quantity and shall be subject to such further conditions as may be prescribed.

(1) The State Government, or, subject to its control, the Deputy Commissioner, may grant emergency permits for the use or consumption of brandy, rum or champagne, or any other kind of liquor to any head of a household for the use of his household for medicinal use on emergent occasions: Provided that the person to whom a permit is granted under this section may allow the use or consumption of liquor in respect of which the permit has been granted by any other person, who requires the use thereof for medicinal purposes on emergent occasions: Provided further that no permit shall be granted to more than one member of a household at any one time. (2) When a person to whom an emergency permit is granted allows the use or consumption of liquor held by him under the said permit by any other person on the occasion referred to in the first proviso to sub-section (1), the person holding the emergency permit shall intimate the said fact, in such manner and at such time as may be prescribed, to the authority granting the permit or to an officer appointed by the State Government in this behalf. (3) Such a permit shall be granted for such quantities and shall be subject to such further conditions as may be prescribed. Explanation.—For the purposes of this section, a household shall mean a group of persons residing and messing jointly as members of one domestic unit.

The State Government may grant special permits for the use or consumption of foreign liquor to any person, who is,- (a) a sovereign or head of a foreign State; (b) an Ambassador, diplomatic envoy or Consul, Honorary Consul or Trade, Commerce or other Representative of a foreign State; (c) a member of the staff appointed by, or serving under, any person specified in clause (a) or (b), provided that such member is a national of a foreign State; and (d) the Consort of any person specified in clause (a), clause (b) or clause (c) or any relation of such person dependent upon him.

All permits issued under this Act are non-transferable. Permits granted under section 31, section 32, section 33 or section 34 shall be non-transferable.

Authorisation may be granted for the use of liquor for religious or sacramental purposes. (1) The State Government, or subject to its control, the Deputy Commissioner, may grant any authorisation to

(1) The State Government, or subject to its control, the Deputy Commissioner may grant tourists’ permits to consume, use or buy foreign liquor to a person who is a tourist. (2) A tourist’s permit may be granted for the period of the tourist’s intended stay in the State, but shall in no case be granted for a period exceeding three months. (3) Such permits shall be available at such places as may be notified by the Commissioner in this behalf.

Interim permits may be granted pending final decision on applications. (1) Notwithstanding anything contained in section 31, section 32 and section 34, the State Government or, subject to its control, the Deputy Commissioner may grant interim permits to persons applying for permits under any of the said provisions. (2) Such interim permits shall not be granted for any period exceeding one month.

The consumption of foreign liquor by permit holders is strictly regulated. (1) No holder of a permit granted under any of the provisions of this Act, other than section 33, shall drink in a public place, in any vehicle parked in a public place or in any room in a hotel or any institution provided the public have access to such room. (2) No holder of a permit granted under section 32 shall allow the use or consumption of any part of the quantity of liquor held by him by any other person. (3) No holder of a permit granted under section 31, section 34, section 37 or section 38, shall allow the use or consumption of any part of the quantity of liquor held by him under the permit by any other person who is not the holder of any such permit.

The State Government, or subject to its control the Deputy Commissioner, may grant licences, on the certificate of the Medical Board, for the consumption or use of intoxicating drugs in such quantities as may be prescribed.

Sale of warehoused articles shall be governed by prescribed rules. The State Government may by rules made in this behalf, regulate the sale, custody or removal of ware-housed intoxicants or hemp.

Import and export of mhowra flowers are subject to regulation. (1) No person shall export, or import, mhowra flowers, except under a pass granted by the Deputy Commissioner or an officer authorised in this behalf. (2) No person or head of a household on his behalf or on behalf of the members of his household, shall in the aggregate collect or transport or sell or buy or have in his possession mhowra flowers exceeding the prescribed limit in weight, except under the authority and subject to the conditions of a licence, permit or pass granted by the Deputy Commissioner or an officer authorised in this behalf: Provided that no licence, permit or pass shall be necessary for the collection, transport, sale, purchase or possession within such area and during such period (hereinafter called “vocation period”) as the State Government may, by notification, notify, of any quantity of mhowra flowers, which shall be the produce of that year and of that area: Provided further that unless the State Government by a notification, otherwise directs, no licence, permit or pass shall be necessary for the transport by rail of any quantity of mhowra flowers through an area which has no vocation period or the vocation period for which has expired at the time when the transport takes place, provided that,- (i) the said flowers are not unloaded in transit, and (ii) there is a vocation period at the place from which and to which the said flowers are transported at the time when the said flowers are despatched or arrive, as the case may be. Explanation.—For the purposes of this sub-section, a household shall mean a group of persons residing and messing jointly as members of one domestic unit.

Molasses exports and movement are subject to State control. (1) Except as otherwise provided in sub-section (2), no person shall export, import, transport, sell or have in his possession any quantity of molasses: Provided that no manufacturer of jaggery from sugarcane shall be liable for possession of molasses which is the by product of the process and is not in excess of such quantity as may be prescribed. (2) The State Government or, subject to its control, the Deputy Commissioner may grant,- (a) licences for the export, import, sale or possession of molasses, or (b) permits for the transport of molasses.

(1) All licences, permits, passes or authorisations granted under this Act shall be in such form and shall, be subject to such conditions as may be prescribed and shall be granted on payment of the prescribed fee: (2) The conditions prescribed under sub-section (1) may include provisions of accommodation by the licensee to Prohibition Officers at the licensed premises or the payment of rent or other charges for such accommodation at or near the licensed premises, and the payment of the costs, charges and expenses (including the salaries and allowances of the Prohibition Officers) which the State Government may incur in connection with supervision to ensure compliance with the provisions of the licence and the provisions of this Act, the rules, regulations and orders made thereunder. Provided that every licence, permit, pass or authorisation shall be granted only on the condition that the holder thereof undertakes, and in the opinion of the officer authorised to grant the licence, permit, pass or authorisation, is likely to abide by all the conditions of the licence, permit, pass or authorisation and the provisions of this Act.

Licensing authorities have the power to suspend or cancel licences for breach of conditions. (1) The Commissioner or any officer authorised in this behalf, may cancel or suspend any licence, permit, pass or authorisation granted under this Act,- (a) if any fee or duty payable by the holder thereof is not duly paid; (b) if the purposes for which the licence, permit, pass or authorisation was granted ceases to exist; (c) in the event of any breach by the holder of such licence, permit, pass or authorisation or by his servants or by any one acting with his express or implied permission on his behalf of any of the terms and conditions of such licence, permit, pass or authorisation or of any licence, permit, pass or authorisation previously held by the holder; (d) if the holder thereof or any person in the employ of such holder or any person acting with his express or implied permission on his behalf, is convicted of any offence under this Act, or if the holder of the licence, pass, permit or authorisation is convicted of any cognizable and non-bailable offence or of any offence under the Dangerous Drugs Act, 1930 (Central Act II of 1930), or under the Trade and Merchandise Marks Act, 1958 (Central Act 43 of 1958), or any offence punishable under sections 482 to 489 (both inclusive) of the Indian Penal Code, or any offence punishable under Article 8 of the Schedule to section 167 of the Sea Customs Act, 1878 (Central Act VIII of 1878). (2) Where a licence, permit, pass or authorisation held by any person is cancelled under sub-section (1), the authority aforesaid may cancel any other licence, permit, pass or authorisation granted or deemed to have been granted to such person under this Act.

The holder of a cancelled or suspended licence has no right to refund or compensation. No holder of a licence, permit, pass or authorisation shall be entitled to any compensation for the cancellation or suspension of the licence, permit, pass or authorisation under section 45, nor to refund of any fee or deposit made in respect thereof.

Licences may be cancelled if the licensee dies or becomes insolvent or for other reasons determined by the government. (1) Whenever the authority granting the licence considers that it should be cancelled for any cause other than those specified in section 45, he may cancel the licence either,— (a) on the expiration of not less than fifteen days’ notice in writing of his intention to do so; or (b) forthwith without notice after recording his reasons in writing for doing so.

The rights conferred by a licence cannot be attached or sold in execution of a decree. Notwithstanding anything contained in any law for the time being in force, no right, title or interest in any licence, permit, pass or authorisation granted under this Act, shall be liable to be sold, transferred or attached in execution of any process of any Civil or any other Court.

The State government shall control and regulate the preparation and use of articles meant for medicinal use to ensure they are not misused. (1) No manufacturer of any of the articles mentioned in section 16 shall sell, use or dispose of any liquor produced or processed for the purpose of such manufacture under the provisions of this Act, otherwise than as an ingredient of the articles authorised to be manufactured therefrom. No more alcohol shall be used in the manufacture of any of the articles mentioned in section 16 other than the quantity necessary for extraction or solution of the elements contained therein and for the preservation of the articles: Provided that in the case of manufacture of any of the articles mentioned in section 16 in which the alcohol is generated by a process of fermentation, the amount of such alcohol shall not exceed twelve per cent. (2) No person shall,- (a) knowingly sell any article mentioned in section 16 for being used as an intoxicating drink; or (b) sell any such article under circumstances from which he might reasonably deduce the intention of the purchaser to use them for such purposes.

Samples of medicinal preparations may be taken for analysis. (1) Whenever the Commissioner has reason to believe that any of the articles mentioned in section 16 does not correspond with the description and limitations provided in section 49, he shall cause an analysis of the said article to be made and if upon such analysis, the Commissioner shall find that the said article does not so correspond, he shall give not less than fifteen days’ notice, in writing, to the person who is the manufacturer thereof or is known or believed to have imported such article, to show cause why the said article should not be dealt with as an intoxicating liquor, such notice to be served personally or by registered post, as the Commissioner may determine, and shall specify the time when, the place where, and the name of the officer before whom, such person is required to appear. (2) Whenever the Commissioner causes an analysis of an article mentioned in section 16 to be made under sub-section (1), he may require the person who is the manufacturer thereof or who is known or believed to have imported such article not to sell, distribute, or otherwise deal with such article or to remove it from any place without the previous permission of the Commissioner for any period not exceeding three months from the date of such requisition or till the result of the analysis is known and communicated to him, whichever is earlier; and thereupon such manufacturer or person shall comply with such request during the said period.