‘Loss of ₹2,002.68 crore’: What CAG report on Delhi liquor policy said

The Comptroller and Auditor General of India's (CAG) report on Delhi's excise department, which was tabled in the assembly by CM Rekha Gupta, has claimed that the former AAP government's decision to implement the new excise policy triggered total losses of over ₹2000 crore to the national capital's exchequer.

"Audit noted that due to a number of issues ranging from weak policy framework to deficient implementation of the policy...there was a cumulative loss of approximately 2,002.68 crore," the CAG said in the report.

The new Delhi excise police was scrapped in 2022 after Lieutenant Governor VK Saxena ordered an FIR into the alleged corruption in the implementation of the document. Several AAP leaders, including Manish Sisodia and Arvind Kejriwal, spent months in jail over their alleged role in the scam.

The Aam Aadmi Party and the BJP have been sniping at each other over the delay in the tabling of 14 CAG reports in the Delhi assembly to review the previous government's performance.

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What CAG report on Delhi liquor policy said?

The report flagged violations in the process of issuing licences, reported PTI. It added that recommendations of an expert panel, which was formed to suggest changes for the formation of the now scrapped policy, were ignored by then deputy chief minister and excise minister Manish Sisodia.

The report claimed that the now-scrapped liquor policy affected a loss of revenue to the tune of ₹941.53 crore because timely permissions were not taken for opening the liquor vends in “non-conforming municipal wards”.

"The excise department suffered a loss of approximately ₹890.15 crore on account of license fee from these zones owing to their surrender and failure of the department in re-tendering," the report added.

It said there was a loss of revenue to the tune of ₹144 crore due to an "irregular grant" of waiver to the licensees because of the Covid pandemic-related closure.

The report said the Master Plan Delhi-2021 prohibited the opening of liquor vends in non-conforming areas, but the Excise Policy 2021-22 mandated opening at least two retail vends in each ward.

"The excise department did not take timely action to work out modalities for proposed vends in non-conforming areas and the initial tender was floated on June 28, 2021, without taking comments from the DDA and MCD,” it claimed.

It added that liquor licences were allotted in August 2021, even before this issue was sorted out and the vends were scheduled to start operations on November 17, 2021.

It claimed the Delhi Development Authority (DDA) issued an order on November 16, 2021, disallowing vends in non-conforming areas.

The licensees then approached the high court. The report said on December 9, 2021, the court exempted them from paying any licence fee in respect of mandatory vends in 67 non-conforming wards, resulting in a loss of the licence fee to the tune of ₹114.50 crore per month.

"Non-sorting of this issue before notice inviting tender (NIT), resulted in this exemption and a cumulative loss of nearly ₹941.53 crore," said the CAG report.

The report further said the Delhi government's departments had proposed that proportionate waiver in license fee due to Covid restrictions may not be considered because there was no provision in the tender document for it. However, the proposal was turned down.

"This proposal was turned down by the Minister in charge of the Department and grant of waiver to each Zonal licensee for the closed vends during the period from 28 December 2021 to 27 January 2022 was approved," it said.

With inputs from PTI