ED links Sisodia’s role in Delhi liquor policy scam to AAP coffers; expands probe to Telangana

Was the Aam Aadmi Party in urgent need of funds, resulting in the Delhi liquor policy scam? This is one of the points of investigation of the Enforcement Directorate that claims to have found that the cartel formation, leading to the doorstep of top AAP functionary and former deputy chief minister Manish Sisodia, was the result of the direct intervention of his close aide and party’s communication in-charge Vijay Nair.

Nair allegedly got into an “arrangement” with Arun Pillai, Abhishek Boinpally, and Buchi Babu—alleged representatives of South Group—to give an advance payment of Rs 100 crore, part of which was supposed to flow into the party coffers.

According to investigators, in the normal scheme of things, this kickback money would have come to the AAP after the operations of the business, but AAP's need for funds was urgent early last year.

The ED, on Friday, sought ten-day custody of Sisodia, arrested by the anti-money laundering agency on March 9, a day prior to his bail hearing in court in the CBI case in the alleged Delhi liquor policy scam. The court reserved its order on the plea till March 21.

Sisodia is expected to be questioned on how the alleged kickbacks to the tune of Rs 100 crore paid by the “South Group” led to the generation of proceeds of crime to the tune of Rs 296 crore in the form of movable and immovable assets.

Taking its probe outside Delhi, the ED has issued summons to K. Kavitha, daughter of Telangana Chief Minister K. Chandrashekhar Rao, for questioning on March 10. The ED is examining her alleged association with the South Group after it found evidence of mobile calls and meetings with some of them. The twin investigating agencies are examining how the cartel was formed to control the liquor business and market illegally to maximize illegitimate profits and to take the cash out of the system to recover the alleged bribes that were paid.

Two key meetings, held in Hyderabad and Delhi respectively in early 2022, are under the scanner of the ED. The first was attended by Vijay Nair, Arun, Abhishek, and others following which funds to the tune of Rs. 31 crore were transferred to Delhi from Hyderabad.

The ED is probing how the South Group members were going to partner with L1 licence holders with 65 per cent shareholding, and how six per cent payment was to be allegedly made to the government.

Investigators alleged the excise policy was formulated with 12 per cent profit margin for L1 wholesalers. Out of this, six per cent profit was earmarked as kickbacks to be given to the AAP, claimed the ED.

On an average, the total annual liquor sale of Delhi was Rs. 4,000-5,000 crore. Out of this, three biggest L1 wholesalers controlled approximately Rs. 3,500 crore business.

The probe has so far revealed that 12 per cent of Rs. 3,500 crore, which is about Rs. 420 crore was profit margin out of which six per cent profit, which is being pegged at Rs 210 crore by investigators, was the final profit supposed to be collected by the AAP.

This was the money that could have come from the normal route but a fast pedal was put in place to bring quick results and funding to the party, said investigators.

By April, 2022, Nair was found holding more meetings and using different methods for recoupment of the advance kickbacks, and one of the methods was through the system of excess credit notes. The agency claimed that the majority of these notes were found reversed on paper in August 2022 , as an afterthought, after investigations began by the central agencies.

The allegations point to a money laundering nexus involving Sisodia, a claim that has the potential of denting the party's image as well as exposing interstate linkages in states like Telangana which is going to polls this year. Kavitha has called it a witch-hunt directed against the Telangana CM, even as Delhi Chief Minister Arvind Kejriwal has vociferously denied the allegations. The AAP is preparing to take the fight to the streets as Sisodia (arrested by the CBI on February 26 and again by the ED on March 9) seems to be in for a long haul behind bars. Party workers protested and sat on dharna in the national capital on Friday accusing the ruling BJP of a political conspiracy.

Meanwhile, the ED is preparing to confront Sisodia with digital records and other material evidence seized during 189 search operations conducted by the agency till now.