Delhi excise policy case: Government's loss of Rs 581 cr was diverted as profit to accused, says ED

This 12 per cent commission was given to them by not paying heed to the expert committee headed by IAS Ravi Dhawan, as per the chargesheet. The ED claimed that the loss was diverted to ostentatious profits to the wholesalers, including accused M/s Indo Spirits which was used to recoup the kickbacks paid in advance by the 'south group'.

The Enforcement Directorate has claimed in its supplementary chargesheet filed in connection with the excise policy case that the Delhi government lost revenues of about Rs 581 crore by providing a margin of 12 per cent to private wholesalers (L1 licence holders).

This 12 per cent commission was given to them by not paying heed to the expert committee headed by IAS Ravi Dhawan, as per the chargesheet.

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The ED claimed that the loss was diverted to ostentatious profits to the wholesalers, including accused M/s Indo Spirits which was used to recoup the kickbacks paid in advance by the 'south group'.

"In order to create a device for continuous payment of kickbacks to Vijay Nair, an unheard of margin of 12 per cent was provided to the private wholesalers contrary to the recommendations of the expert committee headed by Ravi Dhawan, then excise commissioner, which suggested for a single government entity as wholesaler for Delhi.

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"On this account, the government lost revenues of Rs 581 crore that would have accrued to it in case the expert committee recommendations were accepted by the government, which in the subject policy was assigned to private players, only to fill the personal coffers of AAP leaders," the chargesheet read.

Also read | Delhi excise policy case: CBI seizes computer from Manish Sisodia's office

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The ED has also claimed in the chargesheet that the 'south group' directly and indirectly controlled nine retail zones, which included five retail zones of Sarath Reddy.

In some cases, the control was via financing of the EMD (earnest money deposit) for the process, ostensible investments, relatives/dummies/proxies.

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Apart from the direct profits accruing from the wholesale business of Indo Spirits, the modus operandi for recovering the kickback paid in advance by the 'south group', monies in the form of outstanding from the ostensible sales from the wholesale of Indo Spirits to retail of the 'south group' with an understanding that the outstanding was not to be recovered and the amount will be shown as recoverable in the books of account, the chargesheet said.

"Sarath Reddy's controlled entities owed over Rs 60 crore to Indo Spirits, which is shown as outstanding but was not meant to be recovered as part of the conspiracy," the ED claimed.
 

'South group' were given 61% stake in Indo Spirits for recoverey of kickbacks: ED


The Enforcement Directorate (ED) claimed in its supplementary chargesheet filed in the excise policy case of Delhi that 'south group' paid Rs 100 crore as kickback to Vijay Nair and to recover the same, partners of the 'south group' were given 65 per cent stake in Indo Spirits in collusion with accused Sameer Mahandru.

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Apart from this, Deputy Chief Minister Manish Sisodia himself directed the excise commissioner to grant the licence on priority to Indospirit Marketing Pvt Ltd, the ED claimed.

"Kickbacks were given to AAP leaders through Vijay Nair. Against the kickbacks paid, the 'south group' secured uninhibited access, undue favours, attained stakes in established wholesale businesses and multiple retail zones (over and above what was allowed in the policy). In one of the ways to recover/recoup the kickbacks given by the 'south group', its partners were given 65 per cent stake in Indo Spirits in collusion with the accused Sameer Mahandru.

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"The 'south group' controlled these stakes in Indospirit through false representation, concealment of true ownership and proxies, i.e., Arun Pillai and Prem Rahul. This partnership formation was directed by Vijay Nair on the assurance of giving the wholesale business of Pernod Ricard to Indo Spirits," the chargesheet read.

The ED further alleged that the gravity and depth of this criminal conspiracy is such that to grant LI wholesale licence to Indospirits despite various complaints highlighting Sameer Mahandru and Indospirit Marketing Pvt Ltd's role in cartelisation, when Mahandru submitted a fresh application in a different name of 'Indo Spirits', the Deputy CM, Manish Sisodia, himself directed the excise commissioner to grant the licence on priority.

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Also read | ED chargesheets Sameer Mahendru in Delhi excise policy case

Pernod Ricard is one of the accused covered in the subject, who through Benoy Babu and others, in conspiracy with the super cartel and Nair, gave their wholesale business to Indo Spirits.

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The Excise Policy 2021-22 required the manufacturers to register their brands at the lowest EDP net of all discount of any nature whatsoever. However, Pernod Ricard by way of conspiracy got their price fixed without deducting the discounts they offer thus getting a much higher price fixed for their brands and thus earning a huge additional profit which was ineligible to them and should have been passed to the consumers as lower MRP, the ED said.

If the manufacturer had registered the brands at actually lowest EDP, the capacity of the manufacturers to give out credit notes would have been limited. However, Pernod Ricard paid Rs 131.9 crore as credit notes to the retailers via the wholesalers, where the benefit of discounts was shifted to the retailers instead of the actual consumer at large.

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