UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10-Q


[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES  EXCHANGE
    ACT OF 1934


                  For the quarterly period ended March 31, 2007

                                       OR

[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
    ACT OF 1934

                For the transition period from ______ to ________

                         Commission File Number: 0-13181
                          CAPITAL BEVERAGE CORPORATION
             (Exact name of registrant as specified in its charter)

                      Delaware                              13-3878747
             (State or other jurisdiction of             (I.R.S. Employer
             incorporation or organization)             Identification No.)

     120 Rio Vista Drive, Norwood, New Jersey                   07648
     (Address of principal executive offices)                 (Zip Code)

                                 (201) 679-6752
              (Registrant's telephone number, including area code)

                                 Not Applicable
(Former  name,  former  address and former  fiscal year,  if changed  since last
report)

                               ___________________


Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes [X] No [ ]

Indicate by check mark whether the registrant is a large accelerated filer, an
accelerated filer, or a non-accelerated filer. See definition of "accelerated
filer and large accelerated filer" in Rule 12b-2 of the Exchange Act. (Check
one):

Large accelerated filer [ ]    Accelerated filer [ ]  Non-accelerated filer [X]

Indicate by check mark whether the registrant is a shell company (as defined in
Rule 12b-2 of the Act).
Yes [X]     No [ ]

The number of shares common stock, $.001 par value, outstanding as of May 11,
2007 was 3,792,045.

<PAGE>

                          CAPITAL BEVERAGE CORPORATION

                          QUARTERLY REPORT ON FORM 10-Q

                                TABLE OF CONTENTS
                                                                            Page
PART I  - FINANCIAL INFORMATION
Item 1.    Financial Statements (Unaudited)
           Balance Sheets......................................................1
           Statements of Operations............................................2
           Statements of Cash Flows............................................3
           Notes to Financial Statements.......................................4
Item 2.    Management's Discussion and Analysis of Financial Condition
                 and Results of Operations.....................................8
Item 3.    Quantitative and Qualitative Disclosures About Market Risks.........9
Item 4.    Controls and Procedures.............................................9

PART II - OTHER INFORMATION
Item 1.    Legal Proceedings..................................................10
Item 1A.   Risk Factors.......................................................10
Item 2     Unregistered Sales of Equity Securities and Use of  Proceeds.......10
Item 3     Defaults Upon Senior Securities....................................10
Item 4     Submission of Matters to Vote of Securities Holders................10
Item 5     Other Information..................................................10
Item 6.    Exhibits...........................................................10
Signatures....................................................................11








<PAGE>

PART I-FINANCIAL INFORMATION

Item 1. Financial Statements

                          CAPITAL BEVERAGE CORPORATION

                                 BALANCE SHEETS

                                     ASSETS

<TABLE>
<CAPTION>

                                                                                           March 31,         December 31,
                                                                                             2007                2006
                                                                                        ----------------    ---------------
                                                                                          (Unaudited)
CURRENT ASSETS:
<S>                                                                                   <C>                 <C>
     Cash                                                                             $           6,178   $         67,910
     Restricted cash                                                                            737,334            736,045
                                                                                        ----------------    ---------------
         TOTAL CURRENT ASSETS                                                                   743,512            803,955

OTHER ASSETS                                                                                      1,179              3,530
                                                                                        ----------------    ---------------

                                                                                      $         744,691   $        807,485
                                                                                        ================    ===============

                 LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)

CURRENT LIABILITIES:
     Accounts payable                                                                 $         847,155   $        768,166
     Accrued expenses and taxes                                                                       -             28,094
                                                                                        ----------------    ---------------
         TOTAL CURRENT LIABILITIES                                                              847,155            796,260
                                                                                        ----------------    ---------------

STOCKHOLDERS' EQUITY (DEFICIT):
     Preferred stock, no shares issued and outstanding                                                -                  -
     Common stock, $.001 par value; authorized 20,000,000 shares;
         issued and outstanding 3,792,045 shares                                                  3,793              3,793
     Additional paid-in capital                                                               5,986,249          5,986,249
     Accumulated deficit                                                                     (6,092,506)        (5,978,817)
                                                                                        ----------------    ---------------
         TOTAL STOCKHOLDERS' EQUITY (DEFICIT)                                                  (102,464)            11,225
                                                                                        ----------------    ---------------

                                                                                      $         744,691   $        807,485
                                                                                        ================    ===============
</TABLE>




                 See notes to consolidated financial statements.

                                       1

<PAGE>

                          CAPITAL BEVERAGE CORPORATION

                            STATEMENTS OF OPERATIONS


<TABLE>
<CAPTION>

                                                                                          Three Months Ended March 31,
                                                                                       ------------------------------------
                                                                                            2007                2006
                                                                                       ----------------   -----------------
                                                                                          (Unaudited)        (Unaudited)

<S>                                                                                  <C>                <C>
REVENUES                                                                             $               -  $                -
                                                                                       ----------------   -----------------

COSTS AND EXPENSES:
     General and administrative                                                                113,689              66,923
                                                                                       ----------------   -----------------
                                                                                               113,689              66,923
                                                                                       ----------------   -----------------

LOSS FROM CONTINUING OPERATIONS                                                               (113,689)            (66,923)
                                                                                       ----------------   -----------------

NET LOSS                                                                             $        (113,689) $          (66,923)
                                                                                       ================   =================

NET LOSS PER SHARE:
     Basic and diluted                                                               $           (0.03) $            (0.02)
                                                                                       ================   =================

WEIGHTED AVERAGE NUMBER OF SHARES:
     Basic and Diluted                                                                       3,792,045           3,792,045
                                                                                       ================   =================
</TABLE>











                 See notes to consolidated financial statements.

                                       2

<PAGE>

                          CAPITAL BEVERAGE CORPORATION

                            STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>

                                                                                           Three Months Ended March 31,
                                                                                        ------------------------------------
                                                                                             2007                2007
                                                                                        ----------------   -----------------
                                                                                           (Unaudited)        (Unaudited)

CASH FLOWS FROM OPERATING ACTIVITIES:
<S>                                                                                   <C>                <C>
     Net loss                                                                         $        (113,689) $          (66,923)
                                                                                        ----------------   -----------------
     Changes in assets and liabilities:
        Other assets                                                                              2,351                   -
        Accounts payable                                                                         78,989             215,042
        Accrued expenses and taxes                                                              (28,094)           (717,381)
        Federal tax payable                                                                           -             (25,000)
                                                                                        ----------------   -----------------
           Total adjustments                                                                     53,246            (527,339)
                                                                                        ----------------   -----------------

NET CASH USED IN OPERATING ACTIVITIES                                                           (60,443)           (594,262)
                                                                                        ----------------   -----------------

CASH FLOWS FROM FINANCING ACTIVITIES:
     Cash overdraft                                                                                   -                (681)
                                                                                        ----------------   -----------------
NET CASH USED IN FINANCING ACTIVITIES                                                                 -                (681)
                                                                                        ----------------   -----------------

DECREASE IN CASH                                                                                (60,443)           (594,943)

CASH - BEGINNING OF PERIOD                                                                      803,955           2,645,338
                                                                                        ----------------   -----------------

CASH - END OF PERIOD                                                                  $         743,512  $        2,050,395
                                                                                        ================   =================

SUPPLEMENTAL DISCLOSURE OF CASH FLOW
     INFORMATION:
        Cash paid for interest                                                        $               -  $                -
                                                                                        ================   =================
        Cash paid for taxes                                                           $               -  $           25,000
                                                                                        ================   =================
</TABLE>



                 See notes to consolidated financial statements.

                                       3

<PAGE>

                          CAPITAL BEVERAGE CORPORATION

                          NOTES TO FINANCIAL STATEMENTS

                   THREE MONTHS ENDED MARCH 31, 2007 AND 2006
                                   (Unaudited)


1.       BASIS OF PRESENTATION AND DESCRIPTION OF BUSINESS

         The accompanying unaudited financial statements of Capital Beverage
         Corporation (the "Company") have been prepared in accordance with
         generally accepted accounting principles for interim financial
         information. Accordingly, they do not include all the information and
         notes required by generally accepted accounting principles for complete
         financial statements. In the opinion of management, all adjustments
         necessary to present fairly the information set forth therein have been
         included. Operating results for the three months ended March 31, 2007
         are not necessarily indicative of the results that may be experienced
         for the fiscal year ending December 31, 2007.

         The accompanying financial statements should be read in conjunction
         with the Company's Form 10-K for the fiscal year ended December 31,
         2006, which was filed on April 2, 2007.

         Capital Beverage Corporation (the "Company" or "Capital") was formed in
         December 1995 to operate as a wholesale distributor of beer and other
         beverages in New York City. On December 16, 2005, the Company sold
         substantially all of its assets to Oak Beverages, Inc. In December
         1998, CAP Communications, Ltd. ("Cap Com"), a wholly-owned subsidiary,
         was organized to market domestic and long distance prepaid telephone
         calling cards to distributors and to the general public. In December
         2006, the Company dissolved Cap Com.

         The Company will continue to use the proceeds from the sale of the
         Assets for working capital purposes, including the payment of
         indebtedness, trade payables and other outstanding obligations.
         Following the full payment of its creditors, the Company may elect to
         acquire another entity, issue dividend(s) to its stockholders or invest
         the net proceeds at the discretion of the Board of Directors and
         management of the Company. Management currently anticipates that
         additional transactions may take the form of a dissolution of the
         corporation, the liquidation of its remaining assets, and the ultimate
         distribution to stockholders of any assets remaining after satisfaction
         of our liabilities, including personnel termination and related costs,
         sale transaction expenses and final liquidation costs. In event of such
         dissolution, the residual proceeds of the sale of the Assets would
         become part of a pool of assets governed by the plan of dissolution.
         Alternatively, management may elect to invest the net proceeds from the
         sale of the Assets in assets or operations acquired by the Company. In
         such an event, no assets will be distributed to the stockholders.

                                       4

<PAGE>

2.       GOING CONCERN

         The accompanying financial statements have been prepared on a
         going-concern basis, which presumes that the Company will be able to
         continue to meet its obligations and realize its assets in the normal
         course of business.

         The Company has not generated revenue since the sale of assets in
         December 2005. As a result, current operations are not an adequate
         source of cash to fund future operations. The report of the independent
         registered public accounting firm for the year ended December 31, 2006
         contains an explanatory paragraph regarding the Company's ability to
         continue as a going concern. The Company's ability to continue as a
         going concern is dependent on its ability to obtain necessary financing
         to meet obligations and repay its liabilities when they become due or
         be acquired by an operating company. The Company plans to continue to
         provide for capital requirements from the cash from the sale of its
         assets. There are no assurances that the Company will have sufficient
         funds to pay its obligations as they become due or be acquired by an
         operating company.


3.       SIGNIFICANT ACCOUNTING POLICIES

         Cash and Cash Equivalents - Cash and cash equivalents include cash on
         hand and cash in banks in demand and time deposit accounts with
         maturities of 90 days or less.

         Restricted Cash - As per the terms of the asset sale cash held in
         escrow will be released in three traunches of $500,000, on July 16,
         2006, December 16, 2006 and June 16, 2007.

         Income Taxes - The Company follows Statement of Financial Accounting
         Standards No. 109 - Accounting for Income Taxes, which requires
         recognition of deferred tax assets and liabilities for the expected
         future tax consequences of events that have been included in the
         financial statements or tax returns. Under this method, deferred tax
         assets and liabilities are based on the differences between the
         financial statement and tax bases of assets and liabilities using
         enacted tax rates in effect for the year in which the differences are
         expected to reverse.

         Use of Estimates - The preparation of financial statements in
         conformity with generally accepted accounting principles requires
         management to make estimates and assumptions that affect the reported
         amounts of assets and liabilities and disclosure of contingent assets
         and liabilities at the date of the financial statements and the
         reported amounts of revenue and expenses during the reporting period.
         Actual results could differ from those estimates.

         Fair Value of Financial Instruments - The Company considers its
         financial instruments, which are carried at cost, to approximate fair
         value due to their near-term maturities.

                                       5

<PAGE>

         Income (loss) per Common Share - Net loss per common share is based on
         the weighted average number of shares outstanding. Potential common
         shares includable in the computation of fully diluted per share results
         are not presented in the financial statements as their effect would be
         anti-dilutive.

         New Accounting Pronouncements - In September 2006, the FASB issued SFAS
         No. 157, "Fair Value Measurements" (Statement 157), which addresses how
         companies should measure fair value when they are required to use a
         fair value measure for recognition or disclosure purposes under
         generally accepted accounting principles. Statement 157 defines fair
         value, establishes a framework for measuring fair value in generally
         accepted accounting principles and expands disclosures about fair value
         measurements. Statement 157 is effective for financial statements
         issued for fiscal years beginning after November 15, 2007 and should be
         applied prospectively, except in the case of a limited number of
         financial instruments that require retrospective application. We are
         currently evaluating the potential impact of Statement 157 on our
         financial statements. We do not expect the impact will be material.

         In December 2006, the FASB approved FASB Staff Position (FSP) No. EITF
         00-19-2, "Accounting for Registration Payment Arrangements" ("FSP EITF
         00-19-2"), which specifies that the contingent obligation to make
         future payments or otherwise transfer consideration under a
         registration payment arrangement, whether issued as a separate
         agreement or included as a provision of a financial instrument or other
         agreement, should be separately recognized and measured in accordance
         with SFAS No. 5, "Accounting for Contingencies". FSP EITF 00-19-2 also
         requires additional disclosure regarding the nature of any registration
         payment arrangements, alternative settlement methods, the maximum
         potential amount of consideration and the current carrying amount of
         the liability, if any. The guidance in FSP EITF 00-19-2 amends FASB
         Statements No. 133, "Accounting for Derivative Instruments and Hedging
         Activities", and No. 150, "Accounting for Certain Financial Instruments
         with Characteristics of both Liabilities and Equity", and FASB
         Interpretation No. 45, "Guarantor's Accounting and Disclosure
         requirement for Guarantees, Including Indirect Guarantees of
         Indebtedness of Others", to include scope exceptions for registration
         payment arrangements. FSP EITF 00-19-2 is effective immediately for
         registration payment arrangements and the financial instruments subject
         to those arrangements that are entered into or modified subsequent to
         the issuance date of this FSP, or for financial statements issued for
         fiscal years beginning after December 15, 2006, and interim periods
         within those fiscal years, for registration payment arrangements
         entered into prior to the issuance date of this FSP. We are currently
         evaluating the potential impact of FSP EITF 00-19-2 on our financial
         statements. We do not expect the impact will be material.

                                       6

<PAGE>

         In February 2007, the FASB issued SFAS No. 159, "The Fair Value Option
         for Financial Assets and Financial Liabilities-including an amendment
         of FAS 115" (Statement 159). Statement 159 allows entities to choose,
         at specified election dates, to measure eligible financial assets and
         liabilities at fair value that are not otherwise required to be
         measured at fair value. If a company elects the fair value option for
         an eligible item, changes in that item's fair value in subsequent
         reporting periods must be recognized in current earnings. Statement 159
         is effective for fiscal years beginning after November 15, 2007. We are
         currently evaluating the potential impact of Statement 159 on our
         financial statements. We do not expect the impact will be material.

4.       CONCENTRATION OF CREDIT RISK

         The Company maintains its cash balances at various financial
         institutions. These balances are insured by the Federal Deposit
         Insurance Corporation up to $100,000. The Company has not experienced
         any losses in such accounts and believes it is not exposed to any
         significant credit risk on cash on deposit.























                                       7

<PAGE>

         Special Note Regarding Forward-Looking Statements

This Quarterly Report on Form 10-Q contains "forward-looking" statements within
the meaning of Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934, as amended. For this purpose
any statements contained herein that are not statements of historical fact may
be deemed to be forward-looking statements. Without limiting the foregoing, the
words "believes," "anticipates," "plans," "expects" and similar expressions are
intended to identify forward-looking statements. These statements involve
unknown risks, uncertainties and other factors, which may cause our actual
results to differ materially from those implied by the forward looking
statements. Among the important factors that could cause actual results to
differ materially from those indicated by such forward-looking statements
include those risks identified in "Item 7 - Management's Discussion and Analysis
of Financial Condition and Results of Operations" and other risks identified in
our Form 10-K for the year ended December 31, 2006 and presented elsewhere by
management from time to time. Such forward-looking statements represent
management's current expectations and are inherently uncertain. Investors are
warned that actual results may differ from management's expectations.

Item 2. Management's  Discussion and Analysis of Financial Condition and Results
of Operations

         As of December 16, 2005, the Company closed the sale of the Assets to
Oak, pursuant to the terms and conditions of the Asset Purchase Agreement. The
purchase price paid by Oak for the Assets was Nine Million Three Hundred
Thousand Dollars ($9,300,000.00), of which One Million Five Hundred Thousand
Dollars ($1,500,000.00), was deposited with an escrow agent, pursuant to the
terms of an escrow agreement, for at least 18 months for post closing
indemnification claims which may be asserted by Oak (the "Escrow"). A
substantial amount of the proceeds from the transaction were used by the Company
to repay outstanding indebtedness and for working capital purposes.

         The Company will continue to use the proceeds from the sale of the
Assets for working capital purposes, including the payment of indebtedness,
trade payables and other outstanding obligations. Following the full payment of
its creditors, the Company may elect to acquire another entity, issue
dividend(s) to its stockholders or invest the net proceeds at the discretion of
the Board of Directors and management of the Company. Management currently
anticipates that additional transactions may take the form of a dissolution of
the corporation, the liquidation of its remaining assets, and the ultimate
distribution to stockholders of any assets remaining after satisfaction of our
liabilities, including personnel termination and related costs, sale transaction
expenses and final liquidation costs.

         After application of the net proceeds in the manner contemplated, and
assuming ultimate release to us of the entire escrowed amount, and after
deduction of transaction costs in connection with the Asset Sale, the Company
will not have any remaining assets. There will be no monies left over for
distribution, and we may have to reduce or eliminate the severance pay
provision.

         We will continue to incur claims, liabilities and expenses, which will
reduce the realizable value of our remaining assets and the amount potentially
available for distribution to stockholders. Claims, liabilities and expenses
from operations (such as salaries, directors' and officers' insurance, payroll
and taxes, legal, accounting and consulting fees and miscellaneous office
expenses) will continue to be incurred subsequent to the Asset Sale. These
expenses will have to be satisfied from our remaining assets and, therefore,
will reduce the net realizable value of those assets.

         The Company intends to comply with the periodic reporting requirements
of the Exchange Act for so long as we are subject to those requirements. We have

                                       8

<PAGE>

an obligation to continue to comply with the applicable reporting requirements
of the Securities Exchange Act of 1934, as amended, even though compliance with
such reporting requirements is economically burdensome.

         As of December 2, 2005, all employees were terminated, except for
Carmine Stella who will continue to serve as the Company's Chief Executive
Officer.

RESULTS OF OPERATIONS

         The Company had no revenue from operations for the three months ended
March 31, 2007 and 2006

         General and administrative expenses for the three months ended March
31, 2007 and 2006 was $113,688 and $66,923, respectively, which consisted mostly
of professional fees and salary to our only remaining employee. The increase is
mainly attributed to an over-accrual which was reversed in the period ended
March 31, 2006.

         At March 31, 2007 and December 31, 2006, respectively, we had a working
capital (deficit) of $(103,643) and $7,695, respectively.


Item 3.  Quantitative and Qualitative Disclosures About Market Risks

         All of the Company's indebtedness that would have posed an interest
rate risk have been paid in full. As a result, the Company no longer has an
interest rate risk.

Item 4. Controls and Procedures

         We maintain disclosure controls and procedures that are designed to
ensure that information required to be disclosed in our Securities Exchange Act
reports is recorded, processed, summarized and reported within the time periods
specified in the SEC's rules and forms, and that such information is accumulated
and communicated to our management, including our Chief Executive Officer and
Treasurer, as appropriate, to allow timely decisions regarding required
disclosure. In designing and evaluating the disclosure controls and procedures,
management recognized that any controls and procedures, no matter how well
designed and operated, can provide only reasonable assurance of achieving the
desired control objectives, as ours are designed to do, and management
necessarily was required to apply its judgment in evaluating the cost-benefit
relationship of possible controls and procedures.

         As required by SEC Rule 13a-15(b), we carried out an evaluation as of
March 31, 2007, under the supervision and with the participation of our
management, including our Chief Executive Officer and Treasurer, of the
effectiveness of the design and operation of our disclosure controls and
procedures, as of the end of the quarter covered by this report. Based upon that
evaluation, our Chief Executive Officer and Treasurer concluded that our
disclosure controls and procedures were effective in enabling us to record,
process, summarize and report information required to be included in our
periodic SEC filings within the required time period.

         There have been no changes in our internal control over financial
reporting that occurred during the period covered by this report that have
materially affected, or are reasonably likely to materially affect, our internal
control over financial reporting.

                                        9

<PAGE>

PART II--OTHER INFORMATION

Item 1.  Legal Proceedings

            The Company was named as a defendant in an action commenced in
Supreme Court, Kings County captioned F&V Distribution Company LLC v. Capital
Beverage Corp. and GE Capital Corp. The complaint alleged that the Company and
GE Capital Corp. ("GE Capital"), constructively abandoned certain equipment
leased by the Company from GE Capital and sought a declaratory judgment stating
that neither the Company nor GE Capital have any further ownership interest in
the equipment and that F&V Distribution Company LLC may remove and dispose of
the equipment. As of March 2007, all of the parties entered into a Settlement
Agreement in which the action was settled with prejudice in consideration of a
payment by the Company in the amount of $14,000.

Item 1A- Risk Factors- - There have been no material changes in our risk factors
from those disclosed in our 2006 Annual Report on Form 10-K.

Item 2 - Unregistered Sales of Equity Securities and Use of Proceeds - None

Item 3 - Defaults Upon Senior Securities - None

Item 4 - Submission of Matters to Vote of Securities Holders - None

Item 5 - Other Information - None

Item 6.  Exhibits

(a)         Exhibits

     31.1 Certification  of Chief Executive  Officer  pursuant to Section 302 of
          the Sarbanes Oxley Act of 2002

     31.2 Certification  of  Treasurer  pursuant to Section 302 of the  Sarbanes
          Oxley Act of 2002

     32.1 Certification  of Chief  Executive  Officer and Treasurer  pursuant to
          Section 906 of the Sarbanes Oxley Act of 2002


                                       10

<PAGE>

                                   SIGNATURES


Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.



Date:         May 14, 2007                          CAPITAL BEVERAGE CORPORATION
                                                             (Registrant)



                               By: /s/ Carmine N. Stella
                                       -----------------
                                       Carmine N. Stella
                                       President and Chief Executive Officer
                                       (Principal Executive Officer)




                               By: /s/ Carol Russell
                                       -------------
                                       Carol Russell
                                       Secretary and Treasurer (Principal
                                       Financial Officer and Accounting Officer)




                                       11