LG gives nod to prosecute Kejriwal in excise policy case over ₹100 cr kickback allegations

Delhi Lieutenant Governor VK Saxena has granted the Enforcement Directorate (ED) permission to prosecute Arvind Kejriwal, the Aam Aadmi Party (AAP) leader and former Delhi Chief Minister, in the ongoing excise policy case. This decision comes ahead of the Delhi Assembly elections, which are scheduled for February 2025. The ED had sought sanction for prosecution on December 5, 2024, following its investigation into alleged corruption related to the excise policy of Delhi for the year 2021-22.

The ED’s prosecution complaint, filed in May 2024, claims that Kejriwal was involved in a conspiracy with members of the "South Group," a group of liquor traders, to channel approximately ₹100 crore. According to the ED, Kejriwal helped design and implement a "tailor-made" excise policy that benefitted private liquor entities by providing them undue advantages, such as multiple retail zones and stakes in various liquor shops. The agency alleges that these actions violated the objectives of the policy, which was aimed at increasing government revenue and promoting transparency in the liquor trade.

In addition to these claims, the ED asserts that the excise policy allowed certain private entities to form cartels, benefiting from kickbacks in exchange for preferential treatment, including discounted liquor rates and license fee waivers. The investigation also suggests that Kejriwal and other AAP leaders received these kickbacks from liquor businesses during the formulation and implementation of the policy. The ED’s probe further claims that the excise policy was structured to ensure the financial benefit of these private liquor companies, with a fixed 12% margin for wholesale distributors, of which 6% allegedly went to AAP leaders.

The ED’s investigation also focuses on the period of the COVID-19 pandemic when the excise policy was introduced. It is alleged that the policy's design and execution led to substantial financial corruption, with kickbacks funneled through various layers of transactions, including discounts, fee waivers, and other unlawful benefits. According to the ED, this systematic manipulation benefited liquor traders while bypassing the policy’s original regulations, leading to financial irregularities and money laundering.

A special court in Delhi took cognizance of the ED’s prosecution complaint on July 9, 2024. The case involves multiple AAP leaders, including Kejriwal and his former deputy, Manish Sisodia. Both Kejriwal and Sisodia are out on bail in the case and have filed petitions challenging the trial court’s decision to accept the charges filed by the ED. The Delhi High Court is scheduled to hear their petitions on February 5, 2025. These petitions challenge the cognizance of the charges and the ED’s chargesheet in the excise policy case.

The CBI also launched a parallel investigation into the excise policy in 2022, following a recommendation by the Delhi Lieutenant Governor. Both the CBI and ED claim that the excise policy was deliberately manipulated to benefit liquor traders linked to AAP leaders, including awarding liquor distribution rights to private firms in exchange for kickbacks. The agencies further allege that the manipulation of the policy had a broader political impact, influencing elections in Punjab and Goa in early 2022. As of now, the agencies have not recovered any funds directly linked to the alleged corruption.

Despite the ongoing investigations, the AAP continues to deny all charges and criticizes the ED’s actions as politically motivated. The party argues that the investigation has been unnecessarily prolonged, with over 250 raids conducted and extensive documentation reviewed, yet no money has been recovered to support the allegations. The AAP claims the case is part of a broader effort to damage the reputation of the Delhi government and its leadership.