New Delhi: A question hung over the capital all week: will the Delhi Chief Minister be arrested or not?
Delhi CM Arvind Kejriwal refused to appear before the Enforcement Directorate in the ongoing probe in the 2021-22 Delhi excise policy case, questioning the legality of the summons and calling them “politically motivated” for the third time since November.
His repeated non-appearance at ED is the latest iteration in the ongoing Delhi vs Centre political war. His consistent defiance and the ED cases against the Aam Aadmi Party government are ThePrint’s Newsmaker of the Week.
Calling the case against AAP and its key office bearers “illegal”, Kejriwal accused the ED of acting at the behest of the Bharatiya Janata Party. He alleged that the ED sent him a summons just two months before the 2024 Lok Sabha elections to put him behind bars and stop him from campaigning. He even sent a letter to the ED, asking them to send him “a questionnaire” if they sought any information or documents in his possession.
ED, on the other hand, has maintained that Kejriwal needs to be questioned in connection with “irregularities” in the formation of the Delhi government’s now-scrapped liquor policy.
The Kejriwal factor
Since the ED has been able to establish a “money trail of Rs 338 crore in the case”, Kejriwal has to be confronted regarding the findings, an ED source told ThePrint. Moreover, added the source, there are several transactions to show how the money went to AAP and how Kejriwal was aware of the “undue favours” being extended to licensees. These included waivers and reductions in licence fees and the extension of L-1 licences (granted to businesses with experience in wholesale distribution of liquor) for money.
As the ED prepares to issue a fourth summons to Kejriwal, his repeated evasion, and AAP members’ speculations on his arrest, only fuel a political spectacle.
The reality is that if the ED has evidence, it can arrest an individual without repeated summons, as in AAP MP Sanjay Singh’s case.
The reluctance on ED’s part perhaps stems from insufficient evidence or fear of violent backlash from AAP supporters.
But Kejriwal’s dismissal of the summons and accusatory letters to the ED can be perceived as deliberate delay tactics. These actions will only prove detrimental to him and his party as they can prompt the ED to seek a warrant through court and seek help in its execution.
“Law is very clear. If someone has been issued a summon, the individual must appear or can face arrest, searches or seizure. There is also a provision in section 63 of the PMLA [Prevention of Money Laundering Act] which talks about punishment to an individual who disregards summons,” an ED officer said on condition of anonymity.
A senior advocate who did not wish to be named further explained: “The court may question why the ED is seeking a warrant when it already has the power to arrest. Yet, the ED can justify it by citing three ignored summons, saying that an independent arrest may lead to law and order issues.”
An ED officer told ThePrint that summons is just given to elicit information – something Kejriwal has been ignoring to delay the probe.
“The organisation does not pre-judge if a person called for questioning is an accused or a witness. The condition for arrest under the PMLA is only one—a person has to be guilty of an offence of money laundering. What Kejriwal is doing is delaying the probe,” the officer said.
Since the AAP is an accused in the case, the party chief needs to be questioned, the officer added. “We can’t proceed in the probe without questioning him and the court has directed us to complete the probe in a time-bound manner.”
Also read: Delhi services bill foiled Arvind Kejriwal’s plans to create rift between Modi govt and SC
What is the liquor policy case?
The ED is probing the case’s money laundering aspect whereas the Central Bureau of Investigation (CBI) is probing a case of corruption, examining financial favours allegedly granted to vendors who secured liquor licences. CBI is also investigating kickbacks received as part of an alleged nexus.
On 22 July 2022, Delhi Lieutenant Governor VK Saxena recommended a CBI probe into the AAP government’s 2021-22 excise policy. This came after Delhi Chief Secretary Naresh Kumar alleged “deliberate and gross procedural lapses” in his assessment report.
On 17 August, the CBI registered a case against former Delhi minister Manish Sisodia, three Delhi government officials, 10 liquor licensees, and unknown others in line with the home ministry’s instructions.
According to the CBI’s FIR, which was accessed by ThePrint, those accused were instrumental in “recommending and taking decisions pertaining to excise policy for the year 2021-22 without the approval of the competent authority, with an intention to extend undue favours to the licensees post tender.”
Cartel formations, illegal activities
Granting undue financial favours to vendors taking liquor licenses, thereby causing losses of “over Rs 140 crore” to the state exchequer, receiving kickbacks in return for these favours, and conniving with owners of several companies as part of a nexus are some of the allegations being probed by the CBI in its case against Sisodia and other state government officials
The ED has stated in its chargesheet that the now-scrapped liquor policy “prompted cartel formations through back door” and “incentivised other illegal activities” as part of an alleged criminal conspiracy by top AAP leaders to extract kickbacks from liquor barons.
The chargesheet – seen by ThePrint – further alleges that the rescinded liquor policy gave way to an “exorbitant profit margin of 12 per cent and huge retail profit margin of 185 per cent”.
It says that AAP’s media and communications in-charge Vijay Nair allegedly received an advanced kickback of Rs 100 crore from the “South Group”, which comprised, among others, Bharat Rashtra Samithi (BRS) leader K Kavitha.
This money — managed through “hawala channels” — was then used in the AAP’s poll campaign in Goa, the ED claimed.
According to the ED, Delhi government’s new excise policy was framed by top leaders of the AAP to continuously “generate and channel illegal funds to themselves”. The policy, ED said, was formed with “deliberate loopholes to facilitate illegal and criminal activities.”
The ED also said that Nair was the key person from the AAP who “orchestrated the conspiracy of kickbacks, undue favours and arm twisting” and also played a part in forming the excise policy.
The chargesheet also stated that Nair acted as a broker on behalf of AAP leaders for getting bribes and kickbacks from various stakeholders in the Delhi liquor business in exchange for favourable policy changes, which were being drafted.
In one instance, he arranged a meeting between Kejriwal and the managing director of Indospirit Group, Sameer Mahendru, for the purpose of business.
When that meeting did not materialise, Nair arranged a “FaceTime call” during which Kejriwal allegedly told Mahendru that Nair was “his boy” and that he should trust him with his word.
This, ED sources claimed, is an indication that Kejriwal knew about the “deals” being struck by Nair on behalf of AAP.
These facts, the ED added, were relevant to establishing Nair’s involvement in the framing of the now-withdrawn excise policy and the alleged scam.
(Edited by Zoya Bhatti)