Excise policy case: ED files charge sheet against Kejriwal, AAP

The latest charge sheet is the eighth in the series filed by the ED under PMLA in the excise case since November 2022

New Delhi: The Enforcement Directorate (ED) on Friday filed its charge sheet against Delhi chief minister Arvind Kejriwal and the Aam Aadmi Party (AAP) under the Prevention of Money Laundering Act (PMLA) in the alleged irregularities in the Delhi excise policy 2021-22, making it first political party ever to be named as accused in a charge sheet. 

Delhi chief minister Arvind Kejriwal was arrested by ED on March 21, he is currently out on interim bail (File Photo)

An official familiar with the development said, “A detailed prosecution complaint (or charge sheet) has been filed based on irrefutable evidence that shows that Kejriwal is the key conspirator who used his position as the CM of Delhi to facilitate the offence of money laundering punishable u/s 4 of PMLA (prevention of money laundering act) by the ‘company’ i.e. AAP”. 

“AAP has been named as accused under PMLA as it was the major beneficiary of the proceeds of crime generated in the excise policy”, said the official. “At least Rs.45 crore out of Rs.100 crore bribes taken in lieu of favouring certain liquor traders was used for AAP’s Goa poll campaign and as national convenor and member of party’s national executive, Kejriwal was ultimately responsible for funds being used and generated”, added the official. 

The latest charge sheet is the eighth in the series filed by the ED under PMLA in the excise case since November 2022. Kejriwal was arrested by the federal financial crimes probe agency on March 21 from his residence at Flagstaff Road in Delhi. 

A day after the arrest, the ED informed a special court that Kejriwal was and is not only the brain behind the AAP who controlled its major activities, but he was also one of the founding members and was also involved in the decision-making of the policy as evident from the statements of the witnesses. He is also involved in the demand for kickbacks which have inter-alia generated further proceeds of crime, the agency has claimed. 

The Supreme Court last Friday ordered his release on interim bail till June 1 amid the ongoing Lok Sabha elections. 

Elaborating ED’s decision to name AAP in the charge sheet, a second officer said, “AAP has been defined as a company under section 70 of the PMLA, which deals with offences by companies.” 

The AAP received around Rs100 crore in bribes and Kejriwal used his position to utilise proceeds of crime worth about Rs.45 crore from the alleged kickbacks in AAP’s election campaign in Goa in 2022, the ED has alleged. 

“Statements of various persons engaged in the election campaign-related activities by the AAP in Goa have revealed that cash payments were made to them for their work done as survey workers, area managers, assembly managers etc. These persons and activities related to the election campaign were overall managed by Vijay Nair and Durgesh Pathak, AAP, MLA in Delhi,” the agency said on March 22 in court. 

This also shows “the dissipation/utilisation of proceeds of crime by the representative of Manish Sisodia in Goa elections. This is also corroborated by one of the candidates of AAP of Goa elections in 2022 who received funds for election expenses in cash from the AAP volunteers in Goa”, the agency added. 

The ED has linked Kejriwal to the generation and use of the kickbacks saying that at the time of the offence, the CM was “in charge of and responsible for the said ‘company, that is AAP’.” 

“Therefore, not only the AAP but Kejriwal shall be deemed to be guilty of offences punishable u/s 4 of PMLA and shall be liable to be prosecuted and punished as provided u/s 70 of PMLA,” ED said in court while seeking his custody on March 22. 

The agency further claimed that the money laundering had taken place in the Delhi excise policy “with Kejriwal’s knowledge” and that “he didn’t exercise any timely diligence to prevent such contravention”. 

The ED also said the CM has been “intrinsically” involved in the entire conspiracy of the Delhi liquor policy irregularities, referring to his actions involving policy formulation, hatching the conspiracy of kickbacks with the South Group members, and eventually using part of the proceeds of crime in the election campaign of AAP. 

“In this manner, it is established that Kejriwal, who is the ultimate in charge of the AAP, was intrinsically involved in the acts of policy formulation, kickback scheme and the final use of the proceeds of crime thus generated, including conspiracy thereof. Therefore, he is also liable for the use of the proceeds of crime of Rs.45 crore in the election campaign of the AAP in Goa under section 70(1) of PMLA, 2002 apart from his role in his personal capacity”, ED said. 

According to the agency, the AAP’s former communication in-charge, Vijay Nair, acting on behalf of the party’s leaders, received kickbacks to the tune of Rs.100 crore from the South Group to let liquor dealers gain control of the wholesale business and licenses under the now scrapped excise policy. 

The agency cited a statement by businessman Sarath Reddy, who claimed he met Kejriwal, who then asked him to stay in touch with Vijay Nair as someone who “could take care of every problem”. 

Linking Nair with the Delhi CM, ED contended that Nair is Kejriwal’s “very close associate” who acted as a broker and middleman on behalf of top leaders of AAP (especially Kejriwal). 

The Delhi government’s 2021-22 excise policy aimed to revitalise the city’s flagging liquor business. It aimed to replace a sales-volume-based regime with a license fee for traders and promised swankier stores, free of the infamous metal grilles, ultimately giving customers a better buying experience. The policy also introduced discounts and offers on the purchase of liquor, a first for Delhi. 

The plan, however, came to an abrupt end, with Delhi’s lieutenant governor VK Saxena recommending a probe into alleged irregularities in the regime. This ultimately resulted in the policy being scrapped prematurely and being replaced by the 2020-21 regime, and the AAP alleging that Saxena’s predecessor sabotaged the move with a few last-minute changes that resulted in lower-than-expected revenues.