A Bench comprising Justice Arun Kumar and Justice A KSikri directed the Delhi government to file its reply by February 19 to a writ petition by CDBL challenging its January 24 show cause notice to the company. The government, in its show cause notice, had asked the company why it should not reduce the prices of the liquor from the existing Rs 340 to Rs 280 per bottle.

Senior advocate DD Thakur and Jayant Nath appearing for CDBL said it was not possible for the company to reduce the rates as it was paying excise duty as high as 220 per cent and the supply licence would otherwise expire on March 31.

Thakur said the company was forced to move the court as the government declined to hear its appeal before March 31 and gave it a date in the month of May. The company was paying Rs 2.6 crore excise duty every month, CDBL counsel said.

They said the CDBL was challenging the notification on three counts - that it would affect its customers, there was a threat of suspension and cancellation of the licence and recovery of the Rs 1.91 crore.