Delhi excise policy case: Man involved in ‘transfer of Rs 25.5 crore’ to fund AAP Goa polls in ED custody

“Searches were conducted in Chauhan’s office. Rs 1,06,00,000 was seized. He could not explain its source. He was holding the cash given by the members of the ‘South Group’ for the AAP,” Hossain added.

Outlining that Chauhan was involved in transferring proceeds of crime worth Rs 25.5 crore, the agency sought his custody to “unearth further material” in the case. The ED at 7:20 pm on Friday arrested Chauhan for his alleged involvement in the case.

Countering the ED, Chauhan’s counsel stated that there was no need for sending him to the ED custody. “I have always joined the investigation. Why have I been arrested?” he said, adding that audited statements regarding the cash recovery had already been provided to the agency. “The sources of funds, through the business, have also been provided to them,” Chauhan’s counsel added.

Hossain, however, stated that vague and unsatisfactory responses were given by Chauhan. “The Rs 1 crore seized was what was left. The rest of the proceeds of crime were already transferred, consumed, and used up,” said the ED’s Special Counsel.

The ‘South Group’ comprises individuals from South India, that the ED claims “secured uninhibited access, undue favours, attained stakes in established wholesale businesses, multiple retail zones (over and above what was allowed in the policy), and paid Rs 100 crore to AAP leaders in return”.

According to the ED, Delhi Chief Minister Arvind Kejriwal — who was arrested by the central probe agency on March 21 — was “directly involved in the formulation” of the Delhi excise policy, which was drafted “considering the favours” to be granted to the ‘South Group’. One of the alleged members of the Group is Kavitha, Bharat Rashtra Samithi (BRS) leader and daughter of former Telangana CM K Chandrashekar Rao. She was arrested on March 15, and it was after her arrest that the ED alleged, for the first time on March 18, that Kejriwal was a conspirator in the now-scrapped Delhi excise policy case.

Two cases have been registered in relation to the Delhi excise policy — one by the Central Bureau of Investigation (CBI), and the other by the ED over an alleged money laundering case.

The case arose out of a report submitted by Delhi Chief Secretary Naresh Kumar to Lieutenant Governor V K Saxena in July 2022, pointing to alleged procedural lapses in the formulation of the Delhi excise policy 2021-22. The policy came into force in November 2021, but was scrapped in July 2022. The Chief Secretary’s report stated that “arbitrary and unilateral decisions” taken by Sisodia in his capacity as the then excise minister had resulted in “financial losses to the exchequer” estimated at over Rs 580 crore.

The ED alleged that the scam was to give the wholesale liquor business to private entities and fix a 12 per cent margin, for a 6 per cent kickback. In its first prosecution complaint in November 2021, the ED said the policy was “formulated with deliberate loopholes” that “promoted cartel formations via the back door” to benefit AAP leaders.