Explained: Why AAP MP Sanjay Singh was arrested by ED in Delhi excise policy case

Aam Aadmi Party's Rajya Sabha MP Sanjay Singh is the latest leader to be arrested in connection with its money laundering probe into alleged irregularities in Delhi excise policy 2021-22. On Wednesday, the Enforcement Directorate arrested the senior AAP leader after conducting searches at his residence.

Singh was questioned by the central probe agency for over 10 hours in connection with the money laundering case linked to the Delhi liquor policy.

The probe agency alleged that Singh, who was arrested under the Prevention of Money Laundering Act, played a key role in the formulation and implementation of the now-scrapped policy which benefited certain liquor manufacturers, wholesalers and retailers.

The premises of several others close to the AAP MP were searched in the case.

After raids at Sanjay Singh's residence, Kejriwal said that the raids showed that the BJP was resorting to desperate measures as it stares at a defeat in the 2024 Lok Sabha polls.

Earlier, ED had mentioned Singh's name in its charge sheet. The probe agency said that Dinesh Arora, a middleman, had said he had met Singh during a party in his restaurant, Unplugged Courtyard.

In March this year, former Delhi Deputy CM Manish Sisodia was arrested and is still in jail.

The ED case, which was registered in September last year, is based on a CBI FIR filed in August. The CBI had booked Sisodia, three excise department officials and several vendors and distributors among the 15 accused it had arraigned in its FIR.

Earlier, ED had filed an application on April 20 in a court, seeking to correct a "typographical/clerical" error related to Sanjay Singh's name in a charge sheet. It said the name was inadvertently written instead of the name of Rahul Singh, who was the Delhi excise commissioner when the policy was formulated.

The ED said Sanjay Singh's name appears four times in the chargesheet out of which only one reference was wrong.

What is Delhi Liquor Policy?

In November 2021, the Arvind Kejriwal-led Delhi government introduced a new liquor policy. Under the policy, the government withdrew from the retail sale of liquor and allowed private licensees to run stores.

The Delhi government said the move was floated to crack down on black marketing, increase government revenue and improve the overall customer experience.

Under the new policy, the Delhi government allowed liquor shops could stay open well past midnight and stores could offer unlimited discounts. Attractive deals were offered, sales rocketed, and the Delhi government reported a 27 per cent spike in revenue.

When the policy was introduced, the Opposition BJP opposed it and accused AAP of allowing liquor vends to open in residential areas and promoting a "liquor culture" in the capital.

What is Delhi Liquor Policy case?

Last year in July, Delhi Chief Secretary Naresh Kumar noted gross violations in the new liquor policy. His report alleged "undue benefits" to liquor licencees. He also flagged a Rs 144-crore rebate in liquor licence fees during the Covid pandemic.

On the basis of the Chief Secretary's report, Lieutenant Governor VK Saxena recommended a CBI probe into the matter. The Opposition attacked the AAP government for misappropriation of funds, but the ruling party trashed the allegations.

Soon after, the Delhi government withdrew the new liquor policy. This caused more than 400 newly opened stores to close and the sale of liquor was back under the government control till a new policy was put into place.

The probe

In August 2022, the CBI first raided the residence of Delhi's then deputy CM and AAP's Number 2 leader Manish Sisodia. Sisodia said the central agency found nothing and alleged that the BJP had cooked up a case to target the AAP government. Following this, ED joined the probe to investigate the money trail. The ED case was based on the FIR filed by the CBI against Sisodia and 14 others.

Both probe agencies alleged the involvement of a "South Group", which allegedly included K Kavitha, legislator of Bharatiya Rastra Samithi and daughter of Telangana Chief Minister K Chandrashekar Rao, YSRCP MP M Srinivasulu Reddy and Sarath Reddy of Aurobindo Pharma.

The ED alleged that the "South Group" and AAP had an arrangement under which the former provided funds to the Arvind Kejriwal-led party for its Goa election campaign. The AAP was accused of favouring these liquor networks while giving out licences under the new policy.

Arrests and suspects

In September 2022, the CBI first arrested Vijay Nair, former CEO of an event management firm, who had links to AAP. CBI said Nair was involved in "irregularities in framing and implementation of excise policy".

In the same month, liquor retailer Sameer Mahendru was arrested by ED.

CBI's second arrest was Abhishek Boinpally, who was with Robin Distilleries. He was allegedly lobbying for some businessman.

In November 2022, Sarath Reddy of Aurobindo Pharma and Benoy Babu, an executive of liquor giant Pernod Ricard, were arrested by ED. Sarath Reddy has since become an approver in the case.

In February, the CBI arrested Buchi Babu, the former Chartered Accountant of Kavitha, for allegedly acting on behalf of the "South Group". He, too, has turned an approver in the case. The same month, the ED arrested YSRCP MP Reddy's son M Raghavan.

In March this year, ED arrested Sisodia on money laundering charges. His repeated attempts to get bail have failed.

Sanjay Singh's connection to the case

Sanjay Singh was arrested on Wednesday a day after a Delhi court allowed two accused, Raghav Magunta, son of YSR Congress Party Lok Sabha MP Magunta Srinivasulu Reddy, and Delhi-based businessman Dinesh Arora, in a money-laundering case linked to the Delhi excise policy case to turn approvers. Arora is said to be linked to Sanjay Singh.

In his statement to the ED, Arora said that he arranged funds amounting to Rs 82 lakh for AAP to fight the assembly elections in Delhi following a request by Sanjay Singh, Times Now has reported.

Arora has claimed that Sanjay Singh introduced him to Sisodia during a party at his own restaurant.

The ED had arrested Arora in July when he was already declared an approver in a related corruption case being probed by CBI. In another charge sheet, ED has accused Sisodia of receiving bribes from Amit Arora, another businessman and an accused in the case, through Dinesh Arora.

Also read: WATCH: Rahul Gandhi surprises mother Sonia Gandhi with adorable puppy ‘Noorie’

Also read: 'Mammoth amount went into interest repayment on debts inherited': Punjab CM responds to Governor's Rs 47,000-cr loan query

Also read: Actor Ranbir Kapoor summoned by ED in Mahadev online betting case on Oct 6