In the ongoing investigation into the now defunct Delhi liquor policy, the Enforcement Directorate (ED) authorities conducted searches at the residence of Aam Aadmi Party (AAP) MP Sanjay Singh, as part of a money laundering case. This marks the latest development in a complex and controversial case involving various key figures and allegations of impropriety.
New Liquor Policy: The Revenue Generator
In November 2021, the government led by Arvind Kejriwal implemented a new liquor policy in Delhi. This policy involved relinquishing the government’s direct involvement in liquor retail sales, instead permitting private licencees to operate liquor stores. The rationale behind this move was to combat black market activities, boost government revenue, and enhance the overall customer experience. Under the new policy, liquor shops could remain open beyond midnight and offer unlimited discounts, resulting in a significant increase in revenue for the Delhi government.
Boon for Liquor Contractors
In July 2022, Delhi Chief Secretary Naresh Kumar raised concerns about severe violations within the new liquor policy. His report alleged that liquor licencees received undue benefits, along with a substantial Rs 144-crore fee rebate during the Covid-19 pandemic. Following these findings, Lieutenant Governor VK Saxena recommended a CBI investigation, intensifying the BJP’s criticisms of the AAP government. In response, the AAP dismissed the allegations and ultimately withdrew the new liquor policy, resulting in the closure of over 400 recently opened liquor stores. Liquor sales reverted to government control until a new policy could be formulated, and this arrangement has persisted for over a year.
FIR Against Manish Sisodia
Upon assuming control of the investigation, the CBI conducted a raid in August 2022 at the residence of Manish Sisodia, then Delhi’s Deputy Chief Minister-Excise Minister and a prominent AAP figure. Sisodia claimed that the central agency found no evidence and alleged that the BJP had concocted the case to target the AAP government. Subsequently, the Enforcement Directorate joined the probe to trace the money trail. The ED’s investigation was based on the FIR filed by the CBI against Sisodia and 14 others.
South Group: Prominent Funder or Beneficiary
The investigating agencies also alleged the involvement of a group referred to as the “South Group.” This group allegedly included individuals like K Kavitha, a legislator of Bharatiya Rastra Samithi and the daughter of Telangana Chief Minister K. Chandrashekar Rao, YSRCP MP M Srinivasulu Reddy, and Sarath Reddy of Aurobindo Pharma. The ED claimed that this “South Group” and the AAP had an arrangement in which the former provided funds to AAP for its Goa election campaign. In return, the “South Group” was purportedly set to recover this money through liquor businesses it controlled in Delhi, alleging that AAP favored these liquor networks when granting licenses under the new policy.
Vijay Nair-Sameer Mahendru’s Arrest
In September of the previous year, the CBI arrested Vijay Nair, the former CEO of an event management firm with ties to AAP, alleging his involvement in “irregularities in framing and implementation of excise policy.” AAP maintained that Nair was merely a party worker with no connection to the liquor policy. That same month, Sameer Mahendru, a liquor retailer, was arrested by the ED.
Abhishek Boinpally-Benoy Babu
The CBI’s second arrest in the case was Abhishek Boinpally, a director at Robin Distilleries, who was purportedly lobbying for a businessman. In November 2022, Abhishek Boinpally of Aurobindo Pharma and Benoy Babu, an executive at the liquor giant Pernod Ricard, were apprehended by the ED. Sarath Reddy later became an approver in the case.
Buchi Babu and then Manish Sisodia
In February, the CBI arrested Buchi Babu, the former Chartered Accountant of Kavitha, for allegedly acting on behalf of the “South Group.” He also became an approver in the case. During the same month, the ED arrested M Raghavan, the son of YSRCP MP Reddy. The most significant arrest occurred in March when the ED apprehended Sisodia on charges of money laundering. His multiple bail attempts have been unsuccessful, and he has since resigned as Deputy Chief Minister, relinquishing his various portfolios.