PAC report on Delhi excise policy: Failure to re-tender liquor shops, fee waiver led to over Rs 1,000 crore in losses

The CAG report on ‘Regulation and Supply of Liquor in Delhi’ was laid before the Delhi Assembly on February 25 in 2022. The report was referred by the House to the PAC for further examination.

The audit report observed several discrepancies in the way the excise department monitored and regulated the supply of liquor in Delhi. Total financial implication of the audit findings is approximately Rs 2,026.91 crore.

The Performance Audit has examined and dealt with the various aspects such as Excise Supply Chain Information Management System (ESCIMS), licensing policy and issue of licenses, pricing policy, compliance of quality norms, issues related to EIB and Confiscation, working of enforcement branch and rolling out and implementation of Excise Policy 2021-22.

As per the committee’s report, the CAG found that retendering of surrendered licenses was not done leading to loss of Rs 890.15 crore. It also observed that 19 zonal licensees surrendered before the policy (2021-22) expired in August 2022. However, the excise department did not initiate any retendering to operationalise the retail vends in these zones, the report notes.

In its Action Taken Report, the excise department said that it had sought directions for retendering the retail licenses for the year 2022-23, through communications dated February 4, 2022, March 16, 2022 and April 12, 2022 but did not receive any directions from the then Delhi government or the competent authority.

The department also cited several challenges to 100% scanning at the vends namely poor connectivity, power outages, slow performance of the portal during peak sale period,non-reading by scanner due to aging of barcodes and damage to barcodes.

It also stated that daily monitoring and coercive actions against defaulting vends i.e. show-cause notices, purchases disabled etc. are being taken.

The excise department in its action taken note submitted to the PAC, mentioned that the waiver was approved by the then Delhi Cabinet on July 14, 2022.

“The department agrees with the figure of Rs 144 crore (approx) on account of COVID restrictions which was granted by Manish Sisodia , the then Deputy Chief Minister on February 1, 2022 with specific direction that the relief measures be implemented and the Council of Ministers to be informed in due course,” said the department.

The excise policy 2021-22, was implemented in November 2021 and and scrapped in August 2022, following Central Bureau of Investigation (CBI) and the Enforcement Directorate (ED) initiated enquiry into the alleged irregularities.

Meanwhile, AAP held a protest outside the Assembly against the suspension of some of its MLAs from the house.

Leader of Opposition Atishi said, “The Legislative Assembly is a temple of democracy, but BJP has turned it into a hub of the arrogance of power. To crush the voice of the opposition, elected MLAs are suspended, and barricades are put up on the roads with police wielding batons.”

She alleged that the BJP government is running away from the questions of the people to divert attention from issues like electricity, water, the poor condition of hospitals, and the pain of the recent Palam fire incident. “We will raise the questions of the people of Delhi from the streets to the Assembly. We will not bow down before dictatorship, but will fight firmly,” she said.