Look Out Circular against eight accused in liquor scam

Express News Service

NEW DELHI: In what could be a decisive blow to the AAP government in the alleged liquor scam, the Enforcement Directorate’s preliminary enquiries to track the flow of cash have led it to an elaborate regime of discounts, rebates, and credit coupons which was brought in by the Kejriwal government. This discount regime has led to the generation of huge amounts of cash, part of which, the agency suspects, could have gone back to the Aam Aadmi Party leaders.

Sources told this paper that the state government amended Rule 53 of the Delhi Excise Rules 2010 to bring in this discount regime. This amendment in the excise rule allowed the wholesalers to offer unlimited discounts to the retailers. The ED is probing whether part of this discount was returned by the retailers to the wholesalers to be paid as a kickback to the AAP leaders.

The old excise rules expressly prohibited discounts and rebates. Rule 53, sub-rule 1 of the Delhi Excise Rules 2010 said: “The licensee shall neither give concession, rebate, or discount on the price of liquor nor shall give liquor as a gift.”

The Kejriwal government deleted this clause through an amendment that was published in a gazette notification dated May 31, 2021. The amendment in Rule 53 said “Sub-rule (1) shall be omitted”.

The intention behind the deletion of Sub-rule 1 of Rule 53 of the Delhi Excise Rules and the consequences of the same is also the focus of ED investigation.

ALSO READ | EXPLAINED | How the controversy over the Delhi Liquor Policy unfolded

Sources said the ED has found out that two large wholesalers, who are considered close to sections of Delhi’s AAP leaders, have been extending huge discounts, rebates and other incentives to a large number of retailers. The retailers returned part of these discounts in cash to the wholesalers. The ED is now trying to establish that this payback by retailers was used to pay the AAP leadership for facilitating the discount regime in particular, and bringing in a policy favouring wholesalers in general.

Investigators also suspect that the state government turning a blind eye to the violation of new excise policy where wholesalers got into retailing and manufacturers could be part of the conspiracy to allow generation of cash.

The ushering in of the discount regime without any cap had led to some bidders asking the state government about the quantum of discount that a wholesaler could offer to a retailer. One bidder even asked in writing if a wholesaler can offer 100 percent or more discount to the retailers. The excise department reportedly refused to quantify the quantum of discount.

ALSO READ | BJP’s only goal is to stop Kejriwal: Sisodia

The government said that the policy is clear that the government would fix three prices: one, the dealer price, as which the manufacturer would sell his product to the wholesaler; two, the wholesale price, at which the wholesaler would sell the product to retailers; and three, the maximum retail price, at which the retailers would sell the product to consumers. The rest is left to the traders, the government reportedly clarified.

Based on the documents seized by the CBI during the raids and the statement of the accused, the ED believes that with a customized policy in hand, some manufacturers and retailers devised a meticulous plan with the help of friendly retailers to generate hefty cash through discounts and payback. The ED, sources said, is trying to find the last link through which this cash was transferred to the AAP leaders.

NEW DELHI: In what could be a decisive blow to the AAP government in the alleged liquor scam, the Enforcement Directorate’s preliminary enquiries to track the flow of cash have led it to an elaborate regime of discounts, rebates, and credit coupons which was brought in by the Kejriwal government. This discount regime has led to the generation of huge amounts of cash, part of which, the agency suspects, could have gone back to the Aam Aadmi Party leaders.

Sources told this paper that the state government amended Rule 53 of the Delhi Excise Rules 2010 to bring in this discount regime. This amendment in the excise rule allowed the wholesalers to offer unlimited discounts to the retailers. The ED is probing whether part of this discount was returned by the retailers to the wholesalers to be paid as a kickback to the AAP leaders.

The old excise rules expressly prohibited discounts and rebates. Rule 53, sub-rule 1 of the Delhi Excise Rules 2010 said: “The licensee shall neither give concession, rebate, or discount on the price of liquor nor shall give liquor as a gift.”

The Kejriwal government deleted this clause through an amendment that was published in a gazette notification dated May 31, 2021. The amendment in Rule 53 said “Sub-rule (1) shall be omitted”.

The intention behind the deletion of Sub-rule 1 of Rule 53 of the Delhi Excise Rules and the consequences of the same is also the focus of ED investigation.

ALSO READ | EXPLAINED | How the controversy over the Delhi Liquor Policy unfolded

Sources said the ED has found out that two large wholesalers, who are considered close to sections of Delhi’s AAP leaders, have been extending huge discounts, rebates and other incentives to a large number of retailers. The retailers returned part of these discounts in cash to the wholesalers. The ED is now trying to establish that this payback by retailers was used to pay the AAP leadership for facilitating the discount regime in particular, and bringing in a policy favouring wholesalers in general.

Investigators also suspect that the state government turning a blind eye to the violation of new excise policy where wholesalers got into retailing and manufacturers could be part of the conspiracy to allow generation of cash.

The ushering in of the discount regime without any cap had led to some bidders asking the state government about the quantum of discount that a wholesaler could offer to a retailer. One bidder even asked in writing if a wholesaler can offer 100 percent or more discount to the retailers. The excise department reportedly refused to quantify the quantum of discount.

ALSO READ | BJP’s only goal is to stop Kejriwal: Sisodia

The government said that the policy is clear that the government would fix three prices: one, the dealer price, as which the manufacturer would sell his product to the wholesaler; two, the wholesale price, at which the wholesaler would sell the product to retailers; and three, the maximum retail price, at which the retailers would sell the product to consumers. The rest is left to the traders, the government reportedly clarified.

Based on the documents seized by the CBI during the raids and the statement of the accused, the ED believes that with a customized policy in hand, some manufacturers and retailers devised a meticulous plan with the help of friendly retailers to generate hefty cash through discounts and payback. The ED, sources said, is trying to find the last link through which this cash was transferred to the AAP leaders.