Four not part of Delhi admin helped frame scrapped excise policy: CBI

At least four people who were not part of the administration were “actively involved in irregularities in framing and implementation” of the excise policy, the Central Bureau of Investigation’s FIR in the investigation into the city’s liquor policy states, citing unidentified sources that tipped off the agency.

This allegation is among many that the first information report (FIR) mentions, naming Delhi’s deputy chief minister Manish Sisodia, who is also the excise minister, as well as 14 other named individuals. It was on the basis of these allegations that the agency raided Sisodia’s residence and dozens of other locations on Friday, setting off a major confrontation between the Aam Aadmi Party (AAP) and the Bharatiya Janata Party (BJP). The AAP and Sisodia have denied the allegations, calling them a ploy by the BJP in power at the Centre to harass political rivals.

The FIR, registered at 3.30pm on August 17, or roughly 40 hours before agents descended on Sisodia’s home for searches that went on for over 14 hours, lists the senior AAP leader as accused number 1, and invokes sections of the law dealing with criminal conspiracy, falsification of accounts, and the Prevention of Corruption Act.

The FIR is based on a complaint by a senior Union home ministry official, who cited the note received from Lieutenant Governor VK Saxena, who himself had cited a report by the chief secretary finding purported irregularities.

The FIR accused the officials – Sisodia (the excise minister), Arva Gopi Krishna (former commissioner of excise), Anand Tiwari (former deputy commissioner of excise), Pankaj Bhatnagar (assistant commissioner of excise) – of being “instrumental in recommending and taking decisions pertaining to the excise policy for 2021-22 without approval of competent authority with an intention to extend undue favours to the licensees post tender”.

At least four private individuals, the agency said citing sources, were “actively involved in irregularities in framing and implementation” of the excise policy. The agency’s unidentified source also said that these accused were in touch with the accused government officials, and were also involved in monetary transactions.

The agency FIR mentioned the names of four men -- Vijay Nair, former CEO of event management company Only Much Louder, Manoj Rai, a former employee of liquor maker Pernod Ricard, Amandeep Dhall, owner of liquor distributor Brindco Spirits and Sameer Mahendru, owner of distribution company S Indo Spirits.

The agency, citing information from its “source”, contends that some L1 licence holders – wholesale liquor traders from whom retailers procure – were issuing “credit notes to retail vendors with an intention to divert funds as undue pecuniary advantage” to government officials.

“In furtherance to this, they are showing false entries in their books of accounts to keep their record straight,” the FIR said.

To link the impropriety to the deputy CM, the agency says accused number 9, Amit Arora director of Buddy Retail Private Limited based in Gurugram, and one Arjun Pandey were “close associates” of Sisodia.

The CBI said that the two men were “actively involved in managing and diverting the undue pecuniary advantage collected from liquor licensees to the accused public servants.”

It again quoted the “source” as informing the agency that accused Sameer Mahendru had transferred an amount of ₹1 crore to a UCO bank account of M/S Radha Industries, which is managed by accused Dinesh Arora. Arora, a resident of Gujranwala Town in North Delhi, is accused number 11.

The source, according to the FIR, also named Arun Ramachandra Pillai, a Karnataka resident who collected the “undue pecuniary advantage” from Mahendru and sent it to public servants through Vijay Nair (former CEO of M/S Only Much Louder). According to the FIR, a person named Arjun Pandey, a resident of Gurgaon had received ₹2-4 crore from Mahendru on Nair’s behalf.

The CBI’s FIR includes lieutenant governor VK Saxena’s letter dated July 20 to Union home secretary, Ajay Bhalla, recommending a CBI probe. In his letter, Saxena attached a report by the Delhi chief secretary who contended that the policy was drawn up in violation of protocols.

It is on the basis of this report that the LG first flagged what he said were problems in the policy. The chief secretary’s report noted that “decisions were taken and notified by the excise department with the approval of the minister-in-charge in violation of the statutory provisions” which have “financial implications and are in the nature of extending undue favours to the licensee post tender.”

Other issues flagged in the chief secretary’s report were: the approval by the Delhi cabinet on major changes in licence fee and changes in methodology to calculate the licence fee vide cabinet decision No 3009 without it being submitted to the lieutenant governor. The report of the chief secretary also flagged the excise department’s decision to refund ₹30 crore paid to seek the licence for the airport zone, for which the bidder was not able to obtain a no-objection certificate from airport authorities and should have thus been made to forfeit the amount.

The chief secretary also noted that the excise department favoured alcohol merchants by allowing waivers of the licence fee on account of Covid-19 pandemic lockdowns, which resulted in a loss of ₹144.36 crore. The report said that there was no such provision.

The LG also reiterated that while the council of ministers had earlier authorised the finance minister to make minor changes within the overall framework of the policy, the authorisation was withdrawn on May 21, 2021 on the advice of the former lieutenant governor. The LG informed the MHA (Union ministry of home affairs) that changes were incorporated by the excise department with Sisodia’s approval.

On Saturday, the CBI questioned other private individuals named in the FIR. The agency had not made any arrests till the time of going to press.