Shambles. I would be amazed if you could produce evidence that anyone said that supermarkets would need to apply for a premises licence just to permit carol singing. I doubt that there is a single supermarket in the land that does not sell alcohol. A premises licence is required to sell alcohol and indeed they all hold a current licence at present. I am not sure whether they need the licence to explicitly state that they play muzak - although it ought to. Certainly, the muzak is not incidental to another entertainment so it is not covered by the incidental consideration. The wise supermarket will include the fact that it may have carol singers in its initial premises application - and there is little likelihood of anyone raising a valid objection that the carols singing will breach the licencing objectives so the licence would cover it from the start. Otherwise the occasional event provision would be sufficient to cover it.
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