High Court rejects AB InBev's plea to lift New Delhi liquor ban
04 Sep 2019
The Delhi High Court on Tuesday rejected a request from Anheuser-Busch, the world’s largest brewer, to stay a three-year ban on its beer sales imposed in New Delhi Municipal Corporation, dealing another setback for the brewer in a key market.
The Delhi city authorities in July barred the Leuven, Belgium-based AB InBev from selling its beer in the New Delhi market on allegations of evading local state taxes. The company has denied the allegations.
The Delhi excise commissioner, who is already hearing an appeal against the ban order, had rejected a request from the company to hold off implementing the ban, according to a Reuters report.
Hearing the company’s plea against the Delhi government’s decision, Justice Navin Chawla of the Delhi High Court on Tuesday declined to give any immediate relief and said the appeals process before the state authorities must first be completed.
“Why have two parallel proceedings,” said Chawla.
The Delhi government banned AB InBev’s beer sales after a three-year investigation which found that beer maker SABMiller, which was acquired by AB InBev in 2016 for around $100 billion, used duplicate barcodes on its beer bottles supplied to city retailers that year, thereby reducing its tax burden.
AB InBev, which produces popular beer brands such as Budweiser, Hoegaarden and Stella Artois, said it was contesting the allegations which were dated back to 2016, before its takeover of SABMiller.
The Delhi government’s counsel said the case involved “clandestine” dealings, adding that the brewer had not completed its appeals proceedings with the state which will next be heard on 9 September.
AB InBev’s counsel Rajiv Nayar sought immediate relief, saying the brewer was suffering due to the ban as it could not apply for state licences for the next year.
Justice Chawla, however, felt the case is one in which the city government acted beyond its authority in banning AB InBev. He will start hearing the case again on 16 September.
AB InBev, the second biggest player in India’s $7 billion beer market, has a 17.5 per cent market share, according to analysts.
AB InBev is also facing a separate antitrust probe concerning alleged beer price fixing by SABMiller and other companies in India.