The Government of Kerala, through the Taxes (G) Department, issued “The Kerala (Serving of Toddy in Hotels and Resorts) Rules, 2024” on February 2, 2024, under sections 24 and 29 of the Abkari Act, I of 1077. These rules, published as S.R.O. No. 115/2024, were framed to implement the Abkari policy for 2023-2024.
Key provisions of the 2024 Rules include:
Purpose: To grant licenses for the drawing and serving of toddy in eligible hotels and resorts.
Eligibility: Licenses (Form T1) are issued by the Deputy Excise Commissioner to hotels with three-star or above classification granted by the Ministry of Tourism, Government of India, and resorts of equivalent standard situated in tourism centres approved by the Government of Kerala.
Source of Toddy (Original Provision): The right conferred by the license initially extended only to drawing and selling fermented or unfermented toddy from coconut trees located within their licensed premises. Licensees must remit tree tax as per Tree Tax Rules, 1959.
Sale Conditions: Toddy must be natural and conform to specifications, with nothing added to increase its intoxicating quality or alter its composition. It is prohibited to manufacture vinegar or distill spirits from toddy. Sale is primarily to residents of the hotel/resort and their guests for consumption on the premises specifically approved. Exceptions allow serving in restaurants where families partake food, and by swimming pools, lawns, and roof gardens.
Operational Requirements: Licensed premises are generally kept open from 11 O’ clock in the morning to 11 O’ clock in the night, with an extension to 10 O’clock in the morning to 12 O’ clock in the midnight in approved tourist centers. Premises must remain closed on specific days, including birthdays/commemoration days of Mahatma Gandhi and Sree Narayana Guru, Good Friday, International Day Against Drug Abuse, and during election periods.
Distance Restrictions: No license shall be issued to three-star hotels/resorts if located within 200 meters, and to hotels with four-star, five-star, five-star deluxe, or heritage classification if located within 50 meters, from any educational institution, temple, church, mosque, burial ground, or Scheduled Caste/Scheduled Tribe colony. Distance is measured from the gate based on the shortest public pathway.
Penalties: Infraction of rules or conditions may result in a fine of ₹50,000 or cancellation of the license, or both. Excise officers have authority to inspect premises, test measures, check accounts, and seize/destroy unfit toddy.
Subsequently, the “Kerala (Serving of Toddy in Hotels and Resorts) Amendment Rules, 2025” were issued on August 5, 2025, published as S.R.O. No. 891/2025, to amend the 2024 rules. This amendment aligns with the Abkari policy for 2025-2026.
Key amendment in the 2025 Rules:
Expanded Toddy Sourcing: Rule 5 of the 2024 rules was amended by omitting the word “only” regarding the source of toddy. This allows licensees to procure toddy from licensed toddy shops situated in the excise range where the hotel or resort is located.
Procurement Permit: A permit for this purpose must be obtained from the Deputy Excise Commissioner, and the licensee is required to remit a permit fee of ₹2 per litre for the toddy transported from toddy shops.
The Form T1 for the license was also updated to include the privilege to “procure” toddy from licensed shops.
