KARNATAKA STATE BEVERAGES CORPORATION LTD

LIQUOR SALES POLICY- 2013-14

CONTENTS

Clauses Particulars Page Nos

1 Submission of initial documents 01
 Details of organisation of the buyer
 Details of authorized signatories of the
buyer
 Certified copy of license
 Certificate u/s. 206C of IT Act
 Certified copies of GPA etc
2 Web/e-indenting 01

 e-indenting facility to CL-4 (Clubs), CL-

6A (Star Hotels) and CL-11C (MSIL
outlets)
 user ID and password
 availability of funds
 membership fee

3 Issue of stocks 02

 Deposit of DD/DT
 Ownership of stocks
 Responsibility of buyer
 Minimum purchase value
 Sale of loose bottles
 Sale on first-come-first serve basis
 Cold storage facility
4 Sale price 05
 Fixation of price
 Request for provisional ledger extract
 Details of transaction of previous years
 Furnishing of details
 Recovery of difference amount
5 Payment for stocks purchased 06
 Computation
 Issue of stocks through EFT
 Lifting of stocks
 Responsibility of buyer
 6 Tax collection at source 08

 Remittance
 Certificate for tax collection
 Refund
7 Jurisdiction 09
8 Review of the policy 09

Annexures Particulars Page Nos

I Details of organisation of the buyer 10
II Authorisation letter for dealing with 11
the depot of the Corporation
III Authorisation letter for 12
transporters/persons taking delivery
of stock
IV Undertaking to be given by licensees 13
(buyers)
V Format of maintenance charge for 14
storing wine in cold storage room
VI List of designated Banks/Banks 15
Accounts of KSBCL for direct transfer

*****
Karnataka State Beverages Corporation Limited Circular No. 217 dated 31-12-2013

KARNATAKA STATE BEVERAGES CORPORATION LIMITED

Circular No.217 Date: 31st December 2013

Liquor sales policy for the year 2013-14

A detailed procedure for disposal of liquor has been prescribed in various

circulars issued by the Corporation from time to time. This circular supercedes all
previous procedures, so far as it pertains to disposal of liquor. Buyers are requested to
take note of the procedure prescribed in this circular.

1. Submission of initial documents

1.01 Buyers desirous of procuring liquor from the Corporation shall submit the
following documents, before they can be allowed to transact with the Corporation.

(i) Details of the organization of the buyer to be given in its

letter head in the format in Annexure I.

(ii) Details of authorised signatories of the buyer, who would

deal with the depot of the Corporation, to be given in its
letter head as per the format in Annexure II. Details of
authorized transporter/person taking delivery of stock to be
given in Annexure-III. Undertaking to be given by the
Licensees in Annexure-IV.

(iii) A certified copy of the licence granted by the Excise

Commissioner under the Karnataka Excise (Sale of Indian
and Foreign Liquor) Rules, 1967 as may be applicable to
the buyer.

(iv) Certificate, if any, from the Income Tax Department for

collecting tax at a reduced rate under section 206C of the
Income Tax Act, 1961.

(v) 1 [Certified copies of GPA/Lease/Sub-lease/Appointment of

Agents etc., shall be made available to the Depot in cases
wherein the licensees have transferred their interest in the
license].

2. Web/e-indenting

2.01 2[The facility of Web/e-indenting is introduced to the licensees of

CL-4 (Clubs), CL-6A (Star Hotels) and CL-11C (MSIL outlets). This facility
enables the above licensees to request the stock from their respective KSBCL
depots based on the previous day’s closing stock. The Web/e-indenting module
will be enabled to the above licensees with the following terms and conditions:
1. Inserted by Circular No.143 dated 30.08.2007
2. Inserted by Circular No.210 dated 08.02.2013

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Karnataka State Beverages Corporation Limited Circular No. 217 dated 31-12-2013

(i) e-indenting is available at http://eindent.ksbcl.com/axpert8906/aspx/signin.aspx;

(ii) user ID and password will be shared by the respective Depot Managers;

(iii) only previous day’s closing stock is available for making indent and actual
servicing may vary depending upon the first come first serve basis;

(iv) conditions like, subject to availability of funds in the licensee’s credit,

actual availability of stocks etc., contained in the Sourcing Policy of the
Corporation would be applicable for converting the e-indent to invoice and
will be serviced at the respective KSBCL depots.

(v) at the time of servicing first e-indent Rs.100/- will be deducted as one time
membership fee].

3. Issue of stocks

3.01 Issue of stocks shall ordinarily be between 11 am and 6 pm. All buyers
shall ensure deposit of DD/DT before 3 pm of the day. The Depot Manager/authorized
person should record the time and date of receipt of DD/DT in the prescribed register.
The Depot Manager shall service all the buyers the same day, who deposit DD/DT before
2 pm, plus a maximum of 20 DD/DT, deposited during 2 pm to 3 pm. Such service shall
be only to those who fulfill the following conditions :

(i) authorized person is present

(ii) 1[Retailersshould transfer the required fund from their accounts to the
KSBCL depot account electronically and submit the proof to that effect to
the Depot Manager. Based on the proof, Depot Manager will check the
account and confirm the depositing / crediting the amount to the KSBCL
Depot account and arrangements made for issue of stock.]

(iii) Vehicle for taking delivery has been brought and is available in the Depot
premises.

Among those who fulfill all the above 3 conditions, service shall be on first come first
serve basis.

3.02 Ownership of stocks sold to buyers shall pass on to them immediately

upon delivery at the depot. Buyers shall verify the goods before accepting delivery. No
claims shall be admitted for shortages or breakages after delivery.

1. Inserted by Circular No.167/28.06.08

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Karnataka State Beverages Corporation Limited Circular No. 217 dated 31-12-2013

3.03 Buyers are responsible for loading the purchased goods into their vehicle
and transport the same to their destination at their risk and cost. Any damages arising
during handling of goods at this stage shall be their responsibility. Under no
circumstances, shall any claim for damages be entertained after handing over the goods
and no depot shall accept return of goods after issue.

1[3.04 Sale of goods shall be for a minimum value of Rs.50,000/- in Bangalore Urban
and Bangalore Rural District depots and Rs.30,000/- in other depots. However, 10% variation on
the lower side is permitted on the value (while the credit balance of the buyer including DD/DT
shall not be less than Rs.50,000/- and Rs.30,000/- respectively, the buyer’s invoice value could
be lower by 10% i.e. the minimum sale value shall be Rs.45,000/- and Rs.27,000/-
respectively, after TCS).

Further,

(a) If there is no stock or shortage of stock of goods indented by the licensee, to that extent the
value of the invoice could be less than the prescribed minimum of Rs 50,000 or Rs 30,000 , as
the case may be.

b) Within the above limit, sale of loose bottles of any particular brand shall be only to the extent
of loose bottles available in the depot. However, such restriction shall not apply to:

i. Premium brands costing Rs.4000/- & above per CB, subject to

minimum of 3 bottles of 750 ml. or 6 bottles of 375 ml and,

ii. Sale of inner cartons if provided in a CB. In case of Inner Carton Boxes
instructions in para 6.08 of Sourcing Policy apply.]

2[(iii) Brands costing between Rs.2500 and Rs.4000 per carton box, subject to
minimum of 6 bottles of 750 ml and 12 bottles of 375 ml. Such purchase is
allowed once in a month.]

3[(iv) Sale of Beer only shall be for a minimum value of Rs.20000/- (Rupees
Twenty thousand only)

[(v) Sale of Wine only shall be for a minimum value of Rs.10000/- (Rupees Ten
Thousand only).]

1. Substituted by Circular No.140 dated 31.07.2007

2. Inserted by Circular No.154 dated 7.12.2007
3. Inserted as per Circular No.158 dated 23.01.08)

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Karnataka State Beverages Corporation Limited Circular No. 217 dated 31-12-2013

1[(vi) Loose sale of 180 ml premium brands costing Rs.2500 and above per
carton box.
Size Inner carton to be provided
Loose bottles of
Issue of loose bottles also permitted (as per
60ml and 90 ml
Circular No.185 dated 12.10.2010)
bottles
For every 12 bottles i.e. 4 inner cartons for a
carton box containing 48 bottles.
180 ml bottles
For every 24 bottles, i.e. 2 inner cartons for a
carton box containing 48 bottles.

Each inner carton shall be superscribed with the relevant EAL nos., from and to
pertaining to 12 or 24 bottles in each inner carton. The outer carton shall contain the
entire details of EALs pertaining to 48 bottles.

EAL number in respect of inner and outer cartons shall be superscribed in the existing
format as given below :

Supplies to KSBCL
Manufacturer/Suppler Name and Address

Excise Adhesive Label No:

From _______ to _____________

Those manufacturers / suppliers who comply with the above requirements and products
packed accordingly will be offered for sale.

Manufacturers / Suppliers who proposes to introduce inner cartons shall obtain prior
approval from the Corporation before supply.

3.05 The depot shall sell stocks on first-cum-first serve basis.

3.06 The Sales Invoices raised on the Buyer shall be subject to the terms
stipulated in this policy.

1. Inserted by Circular No.180/22.01.10)

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Karnataka State Beverages Corporation Limited Circular No. 217 dated 31-12-2013

1[3.07 The manufacturers can made use of the cold storage facility arrangement
at the IML Depots at Plat Form Road and K.G.Halli, Bangalore, for which Corporation
will levy user charges at Re.0.50 (Fifty paisa only) per day per CB (inclusive of all
taxes). The amount of charges will be recovered weekly (Monday-Sunday) from
immediately forth coming weekly payment. The period of storage in each cycle shall be
calculated as per Annexure-V].

4.0 Sale price

4.01 The price to be charged for the stock issued shall be as fixed by the
Corporation periodically. The Corporation reserves its right to revise the sale price and
such revised prices shall be effective on such dates as may be specified.

4.02 The depot manager shall provide a provisional extract of the ledger
balance of the buyer as and when so requested which however, is subject to final
confirmation by the Head Office. The buyer may seek clarifications in the sales invoices
raised by the Corporation within one week of the sale. Corrective action as may be
necessary would be taken based on the buyer’s representation. Generally, the
Corporation would not entertain clarifications on the sales invoices raised after one week
of the sale.

4.03 [The details of transactions for previous years are available in the HO database. If
a request is received for such data, it has to be retrieved and provided to the concerned
retailers. This involves time and effort by the Corporation officials.

4.04 In view of this, a fee of Rs.100/- (by DD) is prescribed for providing the details of
transactions of one year or part thereof beyond the initial period of one week. The
retailers may be advised to remit the necessary fee and approach the KSBCL, HO
through the concerned depot for the information, if such data is requested by the
retailers.]

4.05 The Corporation is entitled to recover differences due to short billing,

excess dispatches, price differences, short collection of TCS or any other reason,
immediately after such instances are noticed by it. However, such balance amounts, if
any, un-paid within a week from demand shall carry an interest of 18 per cent per annum.
The Corporation is entitled to adjust such amounts immediately out of any payment
received or out of any other credit lying in favour of the buyer..

1. Inserted by Circular No.166 dated 23.05.2008

2. Inserted by Circular No.206 dated 27.08.2012

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Karnataka State Beverages Corporation Limited Circular No. 217 dated 31-12-2013

1[5. Payment for stocks purchased

5.01 Issue of stocks shall be either through Electronic Fund Transfer (EFT) or local
Demand Draft or Pay Order. Payment through Bank Challan stands discontinued and
therefore reference to Bank Challan if any in respect of payment by retailers to KSBCL
stands cancelled, wherever it occurs. The preferred mode of payment shall be EFT as it
results in immediate fund transfer to KSBCL account unlike DDs. EFTs may be effected
through any one of the 13 Banks detailed at Annexure-VI.

5.02 Electronic Fund Transfer works as follows :

i. The retailer may open an account with any of branch of the 13

Banks, and seek EFT facility. The Bank gives EFT facility
including account holder’s ID and Password. The retailer shall
inform KSBCL that he has designated this account as his account
for transfer of funds to KSBCL.
ii. Retailer shall transfer funds electronically to KsBCL Depot
account from the said designated account only. He gets a printout
of the transaction with unique transaction number (This is called
transaction slip).
iii. Retailer or his authorized representative goes to the Depot with the
said transaction slip and shows it to the Depot Manager.
iv. Depot Manager accesses his depot account on the Web, through
the password, and verified whether the credit has come to his
account as per the details in the transaction slip and whether it has
come from the designated account of the retailer.
v. If the credit has come and it is from the designated account, he
delivers the goods to the retailer.
vi. The system permits the retailer to transfer funds to KsBCL through
any Internet gateway, at their home office, cyber café, bank, depot
etc., at their convenience. The system also facilitates transfer of
funds at any hour of the day.

1. Substituted by Circular No.182 dated 20.04.2010

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Karnataka State Beverages Corporation Limited Circular No. 217 dated 31-12-2013

vii. The EFT facility may include Direct Debit mode of payment,
whereby the Retailer, Bank and KSBCL have a tripartite
agreement in terms of which the retailer can authorize the Depot
Manager to directly debit his account for the value of stocks to be
purchased by him. The Bank will allot a password to the Depot
Manager to carry out this transaction and the credit will only be to
KSBCL’s account and not others. Total limits for issue of debit
usages can also be fixed for added security.

5.03 Lifting the stocks for having transferred funds through Electronic Fund Transfer
(EFT) and such funds not credited to KSBCL current accounts with the banks by the
licensees or Dishonour or back reference of the demand draft/pay order/DT by the
Occasional licensees will lead to following action by HO/Depot Manager, whoever
notices the default earlier :-

i. Supplies to the buyer will be stopped forthwith.

ii. The Excise Officer in-charge of the depot shall be requested in writing to
seize all the stocks in the retailer’s shop and direct the retailers to return
the stock/s in the shop to KSBCL.

Further, Supplies to the retail licensee shall be resumed only with the prior permission of
the MD who shall :
a. Levy restoration charges of Rs.50,000/-
b. Recover interest @ 24% plus applicable taxes if any, on the value of stocks
not recovered by excise department, but limited to the value of sales invoice
covered by the impugned DD/DT/EFT.]

1[5.04 It is buyer’s responsibility that he takes delivery of goods only after making
payment thereof. He should verify at his end that all purchases made by him have duly
been paid. If during reconciliation or otherwise it is found that any retailer has taken
delivery of gods and has not taken reasonable care to verify or failed to verify from his

1. Substituted by per Circular No.167 dated 28.06.08)

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Karnataka State Beverages Corporation Limited Circular No. 217 dated 31-12-2013

account whether payment thereof has been made to KSBCL and has not pointed out any
discrepancy immediately to KSBCL, it shall be deemed as dishonest practice by the
retailer, unless proved otherwise and in such cases the following action shall follow :
i. Supplies to the retailer shall stop forthwith
ii. Retailer shall pay and KSBCL shall recover the short payment with interest at
24% for the period of delay in payment.
iii. The supplies to the retailer shall resume only after payment of restoration
charges of Rs.25,000/-

5.05 Buyer may deposit a fixed amount and lift stocks against such deposit. The
Corporation would not pay any interest for the deposit. They may replenish the deposit
periodically.]

1[5.06 Payment by way of Demand Drafts will also be accepted from all the CL-5
Licensees (Occasional Licensees) with immediate effect. The Demand Draft shall be
drawn in favour of Karnataka State Beverages Corporation Limited, payable at
Bangalore. The depot Manager shall issue stocks to the CL-5 licensees for the value of
the Demand Draft immediately. Such payments will be accounted in the respective
Depots and the DD shall be forwarded to HO by courier on the same day.]

6 Tax collection at source

6.01 The Income Tax Act 1961, under section 206C provides for tax collection
at source. Tax would be collected at the time of receipt of amount for sale of goods, at
1% of the sale price (inclusive of excise duty and other applicable taxes). A surcharge
and Education Cess is to be added as specified. However, these rates are subject to
change from time to time.

6.02 A part of the remittance made by the buyer shall be first appropriated
towards tax to be collected. The tax so collected would be remitted by the Head Office
and necessary certificates forwarded to concerned depots for onward transmission to
buyers. Certificates shall be issued at the end of the relevant financial year, on or before
May 31st.

6.03 The buyer is entitled to approach the Assessing Officer for issue of a
certificate for tax collection at a rate lower than the one prescribed. The buyer may
enclose the certificate from the Assessing Officer with a covering letter and authenticate
the certificate by affixing his signature on its reverse, after which the Corporation shall
act upon it. It may be noted that such certificate shall have to be in favour of the
licencee.

1. Amended by Circular No.178 dated 22.07.2009

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Karnataka State Beverages Corporation Limited Circular No. 217 dated 31-12-2013

Annexure - I
Details of the organization of the buyer
(To be given in the letter head of the organization)
Name of the organization

Type of the organization Company/Partnership/Sole Proprietorship

PAN No.
Particulars of the Chief
Executive/Managing
Partner/Owner
Address of the retail shop/bar

City/Town Pin Code

Phone No. STD Code Phone No.
Fax No. STD Code Phone No.
Email
Mobile No.
Name Address Phone No. Fax No.
(With STD (With STD
Code) Code)
(1)
(2)
(3)
(4)
(5)
Details of Excise Licence Licence No. Type of Validity of Validity of
Licence Licence Licence
- From - To
Particulars of the other Directors/
Partners, if any
Range Depot
TIN No.
PAN No.
Form 27G (Reference No.)
Validity of 27G From To
Applicable rate of rebate*
Total amount of Tax Collected at
Source as per Form 27G (TCS)
 Form No.27G enclosed.

Sd/-
Date: Chief Executive/Managing Partner/Owner
(Name/s)

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Karnataka State Beverages Corporation Limited Circular No. 217 dated 31-12-2013

Annexure - II

Authorization letter for dealing with the depot of the Corporation

(To be issued in the letter head of the retailer)

(Paste attested photograph of the person here)

We hereby authorize Sri. …………………………………………….. (name of the person)

whose signature is attested below to deal on our behalf with the depot of the Corporation.

We also certify that action of the authorized signatory/ies is binding on the buyer.

Place: Date:

Authorized signatory
Name
Licence No/Date:
Address:

Signature of Sri. …………………………… (name of the person)

Attested

Authorised signatory
(Name)

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Karnataka State Beverages Corporation Limited Circular No. 217 dated 31-12-2013

Annexure - III

Authorization letter for transporters/persons taking delivery of stock

(to be issued in the letter head of the buyer)

We hereby authorize Sri. …………. ……………………….(name of the person)/transporter

whose signature is attested below to take delivery of the stock on our behalf from the depot of
the Corporation.

We also certify that action of the authorized signatory/ies is binding on the buyer.

Place: Date:

Authorized signatory
Name
Licence No/Date:
Address:

Signature of Sri. …………………………. (name of the person)

Attested

Authorized signatory
(Name)

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Karnataka State Beverages Corporation Limited Circular No. 217 dated 31-12-2013

Annexure – IV

UNDERTAKING TO BE GIVEN BY LICENSEES (Buyers)

(To be given in the letter head of the organization)

To,

The Managing Director,

Karnataka State Beverages Corporation Limited
Seethalakshmi Towers,
No. 78, Mission Road,
BANGALORE – 560 027

Dear Sir,

Sub: Purchase of Liquor – Reg

Ref: Sales Policy of the Corporation for the year 2013-14
***

Please refer to the above.

We are in receipt of the Corporation’s Sales Policy for liquor relating to the year 2013-14 and
have gone through the same in detail.

In this connection, we hereby undertake to purchase liquor from the Corporation in accordance
with the Corporation’s Sales Policy.

Tanking You,

Yours faithfully,

Signature of the Licensee.

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 Karnataka State Beverages Corporation Limited Circular No. 217 dated 31-12-2013

Annexure -V

Format of maintenance charge for storing Wine in the Cold Storage Room

LEDGER NO.
SUPPLIER NAME:
SUPPLIER CODE:

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Karnataka State Beverages Corporation Limited Circular No. 217 dated 31-12-2013

Annexure - VI

LIST OF DESIGNATED BANKS / BANK ACCOUNTS OF KSBCL

FOR DIRECT TRANSFER

Direct Transfer is permissible as per para 4.01 of the Liquor Sales Policy, through any of the
branches of the following Banks. However, such branches should have Core banking facility
(i.e. any where banking facility). The bank accounts of the KSBCL, to which Direct Transfer
should be made is indicated against the concerned bank.

Sl. No. Name of the Bank Branch

1 State Bank of India J.C.Road
2 UTI Bank M.G.Road
3 ING Vysya Bank K.G.Road
4 ICICI Bank M.G.Road
5 Syndicate Bank Avenue Road
6 State Bank of Mysore Wilson Garden
7 HDFC Bank Ltd Bannerghatta Road
8 HDFC Bank Ltd Richmond Road
9 Canara Bank S.R.Nagar
10 Vijaya Bank Indiranagar
11 State Bank of Hyderabad J.C.Road
12 Corporation Bank N.T.Road
13 Union Bank of India Avenue Road
14 Bank of India St. Marks Road

All branches in Karnataka are having core banking facility

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