However, the court allowed the hotels in the four-star and heritage categories to run bars though the state government had banned bars in all hotels below the five-star status. Pronouncing the judgement on a batch of petitions filed by Kerala Bar Owners against the state government's decision to close down bars in hotels, Justice K Surendra Mohan held that "the challenge made against the policy by hotels classified as two-star and three-star fails."
The bar owners had contended that the government decision was taken in 'haste' and would be counter productive as it would lose substantial revenue from Abkari (excise) business, besides impacting tourism. A substantial revenue of the government is augmented from taxes, duties and rentals collected from Abkari business.
At a time when the state is running on overdraft, the government had not examined the impact of prohibiting vending liqour in hotels other than those classified as five-star hotels, they said. The Kerala government's stand was it was its 'avowed' policy to reduce liquor consumption in the state stage by stage and to achieve the goal of total prohibition within a 10-year span.
The government had been directed by the Supreme Court to file the affidavit on a batch of appeals filed by 300 odd bar owners challenging the decision to close down all bars, except those in the five-star category. The government had earlier declined to renew the licences of 418 sub-standard bars and later decided to close down 312 bar hotels, except those in the five-star category.