Decoding Delhi's alleged 'liquor scam' that led to Manish Sisodia's arrest

Under the new, now-scrapped, excise policy, the state government allowed private vendors and shops to sell liquor in Delhi

With the arrest of Delhi's Deputy Chief Minister Manish Sisodia on Sunday, the spotlight has once again fallen upon the national capital's now-scrapped liquor sales policy. Sisodia is the head of Delhi's excise department, which has come into the direct line of fire.

What is the alleged Delhi liquor scam?

In 2021, the Delhi government introduced a new excise policy for liquor. Under the policy, the state government allowed private vendors and shops to sell liquor. The main aim was to improve customer experience and stop black marketing.

home delivery of liquor was also allowed under this policy. The shops were also allowed to stay open till 3 AM. The vendors were free to offer discounts. As a result of the policy, the Delhi government reported a 27 per cent jump in revenue income to Rs 8,900 crore.

However, before the policy could be fully implemented, it had to be examined by Chief Secretary Naresh Kumar. In July 2022, Kumar submitted the report to Lt Governor Vinai Kumar Saxena, accusing Sisodia of providing undue benefits to liquor licensees as kickbacks and commissions. The report further alleged that the funds were used by the Aam Aadmi Party (AAP) in the Punjab Assembly elections in February last year.

It said that undue benefits were given to certain vendors while granting licenses. The vendors allegedly paid bribes for it.

The report also alleged that Sisodia gave undue benefits to liquor licensees by revising the rates of foreign liquor and removing the levy of an import pass fee of Rs 50 per case of beer.

Saxena asked the Central Bureau of Investigation (CBI) for a probe into the issue. Soon, Sisodia announced that the policy would be cancelled because the Bharatiya Janata Party (BJP) was using investigating agencies it controls to intimidate vendors.  

The Delhi Police Economic Offences Wing (EOW) also conducted an investigation. It asked for documents and details about the distribution of liquor licences to vendors from the excise department.

Separately, the Enforcement Directorate (ED) launched a probe into the Delhi liquor scam stating that a certain "South Group" paid Rs 100 crore in kickbacks to AAP for its Goa election campaign.

The CBI named 15 individuals in its FIR in connection with the case. Sisodia is at the top of the list. It said, "Some of the L-1 licence holders are issuing credit notes to retail vendors with an ab initio intention to divert the funds as an undue pecuniary advantage to public servants...showing false entries in their books of accounts to keep their record straight".

The FIR had also named Manoj Rai, a former employee of wine and spirits giant Pernod Ricard; Amandeep Dhal, the owner of Brindco Spirits; and Sameer Mahendru, the owner of Indospirit in the FIR. In 2022, following the claims, the CBI raided 31 locations across India in search of those named.

However, Sisodia's name was not included in the chargesheet until his arrest on Sunday, February 26.

The AAP has continued to dismiss all the charges. It has maintained that it will cooperate with the investigators.