The Supreme Court has denied bail to former Delhi Deputy Chief Minister Manish Sisodia in the liquor excise policy case. The court stated that a money trail of Rs 338 crore had been “tentatively established” and emphasized that the “rule of law applies equally to all citizens and institutions, including the State.” The court accepted the Central Bureau of Investigation’s (CBI) argument that there was a “carefully hatched conspiracy” to ensure unjust enrichment of a select few and that the policy facilitated getting bribes from wholesale distributors for assured exorbitant profits.
In a 41-page order, the court also noted the CBI’s claim that the now-withdrawn policy favored and promoted cartelization, citing the permit granted to Indo Spirit despite several complaints. However, the court also highlighted that the allegation of a Rs 2.2 crore bribe paid to Mr. Sisodia by Amit Arora via businessman Dinesh Arora was not mentioned in the CBI’s chargesheet. The court stated that it may be difficult to regard the alleged payment as a “proceed of crime” under the Prevention of Money Laundering Act (PMLA).
The court granted Mr. Sisodia the option to apply for bail again after three months. The two-judge bench of Justices Sanjiv Khanna and SVN Bhatti had previously stated that Manish Sisodia could not be kept in jail indefinitely.
The court acknowledged the CBI’s claim that the previous policy had been modified to facilitate bribes from wholesale distributors by increasing their commission. The court added that the policy deviated from expert opinions and was designed to provide windfall gains to select distributors in return for kickbacks. Regarding the allegation of kickbacks of Rs 100 crore made by the Enforcement Directorate (ED), the court called it a “matter of debate.” However, it noted that evidence and material indicated that Rs 45 crore had been transferred through Hawala for the Goa election and used by the Aam Aadmi Party (AAP).
Significantly, the court clarified that the AAP, which the ED had argued is a “person” under the PMLA, was not being prosecuted in this instance. The court noted that the charge of vicarious liability under Section 70 of the PMLA could not be alleged against Manish Sisodia.
The CBI alleged that Mr. Sisodia was aware that three liquor manufacturers had an 85% share in the Delhi market. Under the new excise policy, each manufacturer could appoint only one wholesale distributor, but wholesale distributors could enter into agreements with multiple manufacturers. The court accepted the claim that this favored and promoted cartelization, benefiting large wholesale distributors with high market share.
The court also mentioned the role of Vijay Nair, described as the “go-between” and “co-confidante” of Mr. Sisodia. Nair had assured the “South Group” cartel that they would be made distributors for Pernod Ricard, one of the biggest liquor manufacturers in the domestic market.
The case revolves around the now-scrapped 2021 liquor policy in Delhi, where the ruling AAP withdrew from liquor sales and allowed private individuals to run stores. The Delhi government reported a 27% increase in income from the policy, generating Rs 8,900 crore in revenue. However, trouble arose when reports surfaced that Mr. Sisodia had bent or violated rules to award liquor licenses. Following an order from Delhi Lieutenant Governor VK Saxena, a CBI inquiry was initiated, leading to investigations by the ED and the subsequent arrests of senior AAP leaders and others. The agency has claimed that the policy caused a loss of Rs 2,800 crore to the Delhi government.
