Twin blow: Swati Maliwal case flares up, Arvind Kejriwal, AAP named in excise case

This is the first time that Kejriwal, who was arrested on March 21 by the ED and granted interim bail until June 1 by the Supreme Court last week, has been mentioned as an accused in an ED prosecution complaint. This is also the first time that a political party has been mentioned as an accused by the ED in a case.

The ED made its move a day after Additional Solicitor General S V Raju told the Supreme Court that the AAP would be added as an accused in the case.

Appearing for the ED, Raju said the ED had evidence to show that Kejriwal demanded a bribe of Rs 100 crore which went to the AAP for its Goa election expense and that there was “direct evidence” of his stay there in a 7-star hotel being partly funded by an accused who received a portion of the bribe.

The Central agency had earlier said that Kejriwal was “directly involved in the formulation” of the excise policy which was drafted “considering the favours to be granted to the South Group”.

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

The agency also claimed that bribes received from the ‘South Group’ were funnelled into the AAP’s Goa Assembly poll campaign in 2021-2022.

Raju had earlier told a Delhi court: “AAP is a beneficiary which exists as a company. Every person responsible for the conduct of the company is responsible… apart from being liable as an individual, the CM is also vicariously liable (as national convener of the party).”

Section 70 of the stringent Prevention of Money Laundering Act (PMLA) deals with offences by companies. The provision states that “where a person committing a contravention of any of the provisions of this Act or any rule, direction or order made thereunder in a company, every person who, at the time the contravention was committed, was in charge of and was responsible to the company, for the conduct of the business of the company as well as the company, shall be deemed to be guilty of the contravention and shall be liable to be proceeded against and punished accordingly”.

While a political party is not a ‘company’ incorporated under the Companies Act, 2013, the provision has a crucial explanation that could bring a political party under the ambit of the anti-money laundering law.

It reads: “Explanation 1(1) – for the purposes of this section (Section 70),– (i) “company” means any body corporate and includes a firm or other association of individuals”.

The phrase ‘association of individuals’ can include a political party. A party, according to Section 29 A of the Representation of the People Act, is any association or body of individual citizens of India calling itself a political party.

In a supplementary chargesheet, filed in the case by the ED last Friday, Bharat Rashtra Samithi (BRS) leader K Kavitha was named along with four others – Chanpreet Singh, Damodar Sharma, Prince Kumar and Arvind Singh. These accused persons, the ED claimed, had a role in the transfer of funds to Goa for AAP’s election campaign.

The first chargesheet in the money laundering case linked to the excise policy case was filed by the ED in November 2022.