• IN February 2023, Delhi’s Deputy Chief Minister Manish Sisodia was arrested and accused of providing undue benefits to liquor vending licensees.
On July 8, 2022, the Chief Secretary sent a report to Sisodia, who heads the excise department, asking for a reply to his questions. A copy of the report was also sent to Delhi Chief Minister Arvind Kejriwal and L-G Vinai Kumar Saxena on the same day. The chief secretary also informed the EOW about the alleged illegalities, cartelisation, and monopolies in the liquor trade, and asked it to investigate.
Central idea
• A Delhi court has remanded a member of Rajya Sabha in Enforcement Directorate (ED) custody in the Delhi excise policy Scam .
• This has created a big furore among people over the alleged involvement of a hardliner political party which was established solelyto fight political corruption.
What is Delhi liquor scam
The Delhi Liquor Scam, also called LiquorGate, is an alleged political scandal concerning the Delhi Government, which paved its way through the introduction of Delhi’s Excise Policy from 2021 to 2022. This policy brought in private firms and enterprise companies into the retailed liquor sectors. The allegations involve favour to the owners and shareholders of private sectors, waivers and reduction of license fee and creation of numerous licenses to all the new incoming enterprises, with exchange of bribery.This policy mainly focused on moving out the retail sector, and making way to large private sectors and firms.
How it started
• In July last year, Lieutenant governor VK Saxena had recommended a CBI investigation into Delhi Excise Policy 2021-22 after a report by Delhi chief secretary established prima facie violations of various acts and rules in addition to “deliberate and gross procedural lapses” to provide “undue benefits” to liquor licensees. The excise department is headed by Sisodia.
• Another allegation was that the excise department in its 8 November 2021 order revised the formula of the calculation of rates of foreign liquor and removed the levy of import pass fee of Rs 50 per case on beer without approval of the L-G and the Cabinet, thus making it cheaper for retailers causing loss of revenue to the state exchequer. The chief secretary, according to the TOI report, also found lapses in the process of awarding licence for two liquor vends in each ward.
Background
The government also said that it would eliminate the liquor mafia, and enhance consumer experiences visiting new outlets. The private liquor shops were allowed to provide discounts on MRP to attract customers, and were also given provision to deliver liquor until 3 AM. This bill was further sent to the Lieutenant Governor’s sign and approval, which was passed by the governor with certain conditions on unauthorized areas set.
Brief overview of corruption in India
Corruption in India is a pervasive issue that affects various aspects of society, economy, and governance. Here’s a brief overview of corruption in India and its impact:
Extent of Corruption: India has consistently ranked high on global corruption indices. Corruption exists at various levels of government and society, ranging from petty bribery to grand corruption involving high-ranking officials and business elites.
Causes of Corruption: Several factors contribute to the prevalence of corruption in India, including:
Weak legal and regulatory frameworks
Lack of transparency and accountability in governance
Complex bureaucratic procedures that breed opportunities for rent-seeking behavior
Socio-economic disparities and unequal access to resources
Political patronage and collusion between politicians, bureaucrats, and businesses
Impact on Society and Economy: Impedes economic development and growth by distorting markets, deterring investment, and diverting resources away from productive sectors.
Exacerbates poverty and inequality by perpetuating a system of patronage where access to basic services and opportunities is often determined by one’s ability to pay bribes or connections.
Undermines public trust in institutions and erodes the rule of law, leading to a cycle of cynicism and apathy among citizens.
Hinders effective delivery of public services such as healthcare, education, and infrastructure, leading to substandard outcomes and perpetuating socio-economic disparities.
Political Ramifications:
Corruption undermines the legitimacy of elected representatives and political institutions, eroding democratic principles and accountability.
Enables the consolidation of power among entrenched elites and political dynasties, perpetuating a cycle of impunity and entrenched interests.
Fuels public discontent and can lead to social unrest, protests, and political upheaval.
Raids from CBI
On 20 August 2022, the Central Bureau of Investigation (CBI) conducted raids on the Deputy CM Sisodia’s residences to determine the series of accusations charged on the government relating to the liquor scam. Raid were also carried out on civil servants and officers related to this issue.
ED
On 6 September 2022, the Enforcement Directorate (ED) carried out raids in 40 locations across the country. As per the officials these raids were carried out on the basis of FIR filed by the CBI, in which Manish Sisodia was named as accused.
Delhi excise policy
The excise policy was aimed at revitalising the city’s flagging liquor business and switching to a regime with a licence fee for traders. The policy promised swankier stores and a better buying experience as well. The policy also included some discounts and offers on the purchase of liquor for the first time in Delhi.
Due to alleged irregularities in the regime, Lieutenant Governor Vinai Kumar Saxena ordered a probe into the matter. The move led to the scrapping of the policy. The matter is currently being investigated by the Enforcement Directorate. In its sixth charge sheet filed in the case, the ED named AAP leader Sanjay Singh and his aide Sarvesh Mishra, and accused the party of using kickbacks worth ₹45 crore generated via the policy for its assembly elections campaign in Goa in 2022.
Summary
- According to the report submitted to the L-G and CM, Sisodia allegedly made changes to the excise policy without the approval of the L-G, such as allowing a waiver of Rs 144.36 crore on the tendered licence fee.
- Officials said that if any changes are made to a policy that has already been implemented, the excise department needs to place them before the cabinet, and forward it to the L-G for final approval. Any changes made without the approval of the cabinet and L-G are illegal, and in violation of the Delhi Excise Rules, 2010 and the Transaction of Business Rules, 1993.
- The report also alleged that Sisodia gave undue benefits to liquor licensees by revising the rates of foreign liquor and removing the levy of an import pass fee of Rs 50 per case of beer. This, according to the report, made foreign liquor and beer cheaper for retail, leading to a loss of revenue for the state exchequer
Conclusion
• The scam had led to arrests and legal proceedings involving corruption allegations and procedural lapses.
• Allegations of financial improprieties and irregularities in the policy’s implementation have created a complex legal landscape.
• The involvement of the Enforcement Directorate adds to the intracies of the case ,while ongoing investigations seek to establish the veracity of the allegations.
Author : Sneha Swami
College : Bhagat Phool Singh Mahila Vishwavidylaya Sonipat
