Over the last two weeks, the state excise department has cracked down on close to 600 liquor shops in the state for not sticking to the prescribed maximum retail price (MRP). A penalty of Rs1 lakh was also slapped on each of them, excise officials said. These sudden raids followed a recent high court directive.

The court directed liquor shop owners to stick to the MRP and issue bills for every sale transaction. "We have let off erring shops only with a fine. If they are found flouting the norms next time, we will seal their outlets," said an official of the department, pointing out how the MRP violations are rampant in the coastal region. In Hyderabad, however, things are not that bad. "This is because stores in the city usually sell below MRP, thanks to stiff competition. There is also no cartel here, again helping keep the prices under check unlike in districts," the official added.

But while these sudden checks have helped the excise department earn some additional revenue, it has predictably left liquor dealers fuming. In fact, reacting to the raids, several shops in districts such as East and West Godavari, Warangal, Anantapur and Visakhapatnam on Monday pulled down their shutters and refused to open till the court order was revised. "It is an open secret that the excise department, at the time of auction (of licences) unofficially assures bidders that they can sell above MRP to recover costs. That's the reason why people make such huge bids. So, for the department to go back on that now is incorrect," said D Venkateshwar Rao, general secretary, Andhra Pradesh State Wine Dealers Association.
suggesting that the government do away with the auction system in order to control liquor prices in the state. "Unless that is done and the bidding limit is left undefined, this problem will persist," he added.