The Delhi High Court recently granted much-needed interim relief to Hauz Khas Social, a popular restaurant-cum-bar in the capital, by allowing it to continue serving liquor despite pending renewal of its Eating House License. The case was heard by Justice Sachin Datta, who passed the order while addressing a petition filed by Epiphany Hospitality Pvt Ltd, the company operating Hauz Khas Social.
Read also: Writ Petition Not an “Earlier Application” Under Section 42 of Arbitration Act: Delhi High Court
Background of the Case
Epiphany Hospitality Pvt Ltd approached the court after its liquor sales were abruptly halted on April 3, 2025. The Excise Department had instructed the restaurant's manager to stop the sale of alcohol due to the non-availability of a valid Eating House License. The petitioner, however, argued that the delay in renewal was due to administrative bottlenecks and not their own fault.
It is undisputed that the petitioner holds a valid L-17 and L-17F license for the service of Indian and Foreign liquor, which has been extended till June 30, 2025, as per a circular dated March 26, 2025. The only issue cited was the absence of a currently valid Eating House License, pending renewal.
The petitioner submitted that they have held an Eating House License since 1994, which had been regularly renewed without issues. The latest license was valid till March 31, 2024, and a renewal request was duly submitted. However, the Delhi Police Licensing Unit had not processed the renewal due to a missing ‘area suitability report’, which was supposed to be obtained by the concerned department—not by the petitioner.
“In case there is any delay on account of the same, the responsibility and consequences thereof cannot be fastened upon the petitioner,” the court observed.
Furthermore, the Excise Department’s order stopping liquor sales was seen as premature and unjustified. The petitioner’s counsel also emphasized that Delhi Eating House Regulations, 2023, under Paragraph 6(ii), clearly state:
“Where an application is made in accordance with sub-regulation (i), the premises in respect of which the Registration Certificate is to be renewed, shall be deemed to be duly registered until such Registration Certificate is renewed and delivered… or till an intimation that the renewal… has been refused.”
This provision was central to the case.
Justice Sachin Datta acknowledged that the application for renewal had not been declined and therefore the restaurant should continue to be deemed registered.
The court also noted that a Show Cause Notice (SCN) was issued earlier by the Delhi Police alleging that the restaurant was serving alcohol within 100 meters of a government school and village temples. However, this issue was already responded to in detail by the petitioner on February 19, 2025, and no further action was taken since then. The petitioner had clarified that the Delhi Fire Service (DFS) had re-inspected the premises on February 3, 2025, and found everything in compliance with fire safety norms.
“There is admittedly no change in circumstances from earlier to now vis-à-vis the serving of alcohol on the premises and distance to a Govt. School and Village Temples,” stated the reply.
A Show Cause Notice-cum-Order dated April 8, 2025, was issued by the Excise Department alleging that the restaurant did not possess a valid Eating House License, which is a mandatory linked license under Rule 51(10) of the Delhi Excise Rules, 2010. The SCN demanded a reply within 15 days, asking why the excise license should not be suspended.
However, the court found this action misconceived and stayed the directive that asked the restaurant to “cease the operation of service of liquor”.
“The direction… requiring the petitioner to cease the Operation of Service of Liquor, is ex-facie misconceived,” stated the Court.
After hearing both sides, the Delhi High Court issued the following directions:
- Deemed Registration: “The petitioner’s premises shall be deemed to be duly registered… until its registration certificate is duly renewed and delivered OR till an intimation is sent… that renewal has been refused.”
- Renewal Processing Deadline: The Delhi Police (Licensing Unit) must process the renewal application and take a decision within two weeks.
- Stay on Liquor Ban Order: The Excise Department’s order directing stoppage of liquor service is stayed until the Show Cause Notice is fully adjudicated.
- Petitioner’s Responsibility: The restaurant is expected to file a detailed reply to the SCN within the given time frame, and the licensing authority must consider the applicable laws and the outcome of the renewal process before making any decision.
Appearance: Ms. Shyel Trehan (Sr. Adv) along with Mr. Raghav Anand, Mr. Shubham Kathuria, Ms. Vidhi Jain, Mr. Suhail Ahmed, Advs for Petitioner; Mr. Satender Sangwan (ACP) along with Mr. Mukesh Rana (Inspector) and Mr. M. Singh (SI) for Delhi Police for Respondents
Case title: Epiphany Hospitality Pvt Ltd v. The Commissioner Excise Entertainment And Luxury Tax Department Govt Of Nct Of Delhi & Anr.
Case no.: W.P.(C) 4518/2025
