Thiruvananthpuram: The Kerala High Court on Thursday upheld the state government's decision to put a ban on serving liquor in over 700 small bars across the coastal state.
The high court, however, allowed five and four star and heritage hotels to serve liquor in compliance with the state government's earlier directive in this regard.
The decision is likely to force over 700 small bars in the state to shut down in a phased manner.
The Kerala small bars association is completely dissatisfied with the ruling and has announced to challenge the order in the higher court.
The high court passed its order while responding to a bunch of petitions challenging the state government's decision to close own over 700 bars across the coastal state.
State's Chief Minister Oommen Chandy had announced a 10-year plan in August that calls for liquor ban in Kerala and shutting down of over 700 bars across the state.
The state government, however, allowed the five-star hotels to serve booze but with a condition that they will observe a dry day on Sundays.
The bar owners had challenged that order in court, contending that the decision was taken in 'haste' and would be counter-productive as it would lose substantial revenue, besides impacting tourism.
Earlier, the Supreme Court, which was also approached by an association of bar owners, had stayed the government's decision till September 30 and said that the exemption to five-stars appeared illogical.
According to the government's plans, state-run liquor stores, where men queue up for their daily fix, will be phased out at a rate of ten per cent a year for the next decade, leaving a big hole in the state coffers after alcohol taxes and fees generated more than $1 billion or Rs. 6,000 crore in the 2012-13 financial year.
Bar owners who have taken the government to court say if there is an alcohol ban, tourists will start opting for other regional destinations - perhaps the beaches of nearby Goa or Sri Lanka. A recent survey from travel portal Holiday IQ.com, which polled 5,000 Indians, showed 58 percent of the respondents will change their travel plans because of the new no-boozing policy.
Interestingly, Kerala has the highest liquor consumption levels in India.