MANISH SISODIA has been in judicial custody for almost a month now. He was first arrested by the CBI on February 26 and sent to judicial custody on March 6. He carried the Gita to Tihar jail and was immersed in it. On March 10, the ED arrested him from jail for alleged money laundering in the excise policy scam, which allegedly cost the Delhi exchequer Rs2,873 crore. He has also been accused of destroying digital evidence. He was in ED custody till March 22.
During his stay in the lock-up on the third floor of the ED headquarters in Delhi, Sisodia woke up at 7am, meditated, had dal and roti for breakfast and was then interrogated for eight hours by a senior officer. He slept on an elevated mattress in an air-conditioned room. His neighbour was Trinamool Congress strongman Anubrata Mondol, who is in ED custody in a cattle-smuggling case.
“Can I have a cup of tea?’’ Sisodia had asked on the first day of ED custody. “With milk, please. I have not had a cup since morning.’’ After his experiences in court and in Tihar jail, he seemed to have settled well in the ED lock-up. He was slightly ruffled though, on catching a glimpse of the rather burly Mondol.
Sisodia is now back in Tihar jail, under judicial custody till April 5 in the CBI’s case of graft and the subsequent money laundering case by the ED. He is accused of tweaking the liquor policy without approval of the competent authority (the lieutenant governor) to extend undue favours to licensees post tender―for which the FIR was filed on August 17, 2022.
Sisodia’s case is unique.
For the first time, the ED has alleged that the proceeds of crime generated through money laundering by any politician have been used to fund elections. Excise, mining and cattle smuggling are considered the big money ‘deals’ for corrupt politicians. But, the proceeds of crime have not been linked to elections till now. The ED is linking the money trail of alleged kickbacks to the AAP’s campaign in Goa in 2022.
While the party itself does not become an accused entity, Sisodia is accused of filling its coffers with ill-gotten wealth. The ED claims the evidence gathered till now points to business entities, persons, groups, government functionaries and middlemen who benefitted, but it is probing whether Sisodia benefitted personally.
The AAP is up in arms asking how the ED can press charges of money laundering if Sisodia did not benefit personally. But the ED booked him under the Prevention of Money Laundering Act for causing illegal gains against kickbacks (to the party) and causing a loss to the government exchequer. “He took various decisions as a part of the group of ministers and as the excise minister which ultimately resulted in a huge loss to the exchequer and illegal gains to specific persons and entities against kickbacks,” the ED told the court in its remand paper.
The key question is whether the ED investigation will stop at Sisodia. He was one of the group of ministers, formed in February 2021 for excise reforms, which, as per the ED, tweaked the excise policy, overriding expert committee decisions and bypassing the lieutenant governor. ED sources said Sisodia told interrogators that all decisions were taken collectively. The ED is corroborating his statement with the statement of AAP leader Satyendar Jain, who is cooling his heels in Tihar jail in another money laundering case. Sources told THE WEEK that Jain, who was part of the GoM, has also talked about “collective responsibility’’ when asked about the changes in the GoM report in March 2021.
Sisodia is countering his interrogators by claiming that the accused government functionaries who have given statements exposing his role in the alleged conspiracy are acting at the behest of Lieutenant Governor Vinai Kumar Saxena, with whom the AAP has a running feud.
A civil servant and secretary to Sisodia, C. Arvind, had given a statement to the ED on December 7, 2022, that he was called by Sisodia to Chief Minister Arvind Kejriwal’s residence, where Jain was also present, and handed over the draft GoM report in mid-March, 2021.
“The conspiracy of the GoM to give wholesale business to private entities and fix 12 per cent margin (to allegedly get 6 per cent kickback) is clear from the statement of C. Arvind, where he discloses that there was neither any discussion in the GoM meetings about giving wholesale to private entities nor fixing 12 per cent profit margin for them,’’ said the ED in its charge-sheet on January 6.
Sisodia was asked about the rationale and calculation for keeping the profit margin of the wholesaler at 12 per cent. And, according to ED sources, he admitted that since there was no proper calculation behind the 5 per cent margin in the previous policy, the GoM “doubled it to 12 per cent without proper calculation”.
AAP lawyer Mohammad Irshad refused to comment, while senior advocate Dayan Krishnan, appearing for Sisodia, said his mandate is to speak in court.
Calling it a “political conspiracy’’ to defame the AAP, Sisodia told his investigators that deliberate attempts have been made to discredit the GoM decision. He is learnt to have pointed fingers at the expert committee headed by Ravi Dhawan, then excise commissioner, (which suggested a single government entity as wholesaler for Delhi) for trying to show there were gaps in decision-making at the political level.
But, for all the drama outside, the questioning by the ED was not acrimonious and the atmosphere was calm and friendly. Sisodia was surprised when he saw that the interrogation would be on camera. “So I will not be able to have any informal talk with you?” he quipped.
It was on March 11, after Sisodia had been in the ED lock-up for a day (apart from the interrogation, he had spoken to his wife and his advocate, and got clothes from home), that K. Kavitha, daughter of Telangana Chief Minister K. Chandrashekar Rao, walked into the ED headquarters for questioning on her alleged links to Sisodia and the excise scam. There were heavy security arrangements as supporters of the Bharat Rashtra Samithi leader staged a protest. She raised a clenched fist towards the supporters before entering the ED office. This was in stark contrast to Sisodia’s arrival. His supporters had staged protests during his arrest by the CBI on February 26, but had stayed away from the ED office on March 10.
Moreover, though the AAP is ruling Delhi, there were no protestors outside the ED office when Sisodia was locked-up there. “It is not a one-day battle; we are going to fight the case legally and politically,’’ Sisodia is learnt to have told his interrogators. Incidentally, the BRS and the AAP joined hands in staging a walkout from both houses of Parliament on March 14 to protest against the alleged misuse of central agencies by the BJP government.
The ED has alleged that Kavitha invested, through a proxy, in a company which is under the scanner in the excise scam and, in turn, the proceeds of crime generated from the business were invested on her directions in immovable properties in Hyderabad, Telangana. Kavitha, meanwhile, said that her father, and not her, was the BJP’s real target. She has accused the ED of targeting her for political reasons and has mounted a legal challenge against the ED. The Supreme Court will hear her plea in around three weeks and the fate of her case now hinges on the apex court’s decision.
At the heart of the ED and CBI probe against Sisodia is the alleged role of Vijay Nair, AAP’s communication in-charge, and a close associate of Kejriwal, who was closely interacting with Sisodia on excise policy-related matters. Nair is currently in judicial custody. The ED has alleged that Nair and the “south group’’ (which the ED says is comprised of Sarath Reddy, M.S. Reddy, R. Magunta and Kavitha, who were represented by Arun Pillai, Abhishek Boinpally and Buchi Babu) were part of the original conspiracy. While Pillai is in ED custody and Magunta in judicial custody, Boinpally, Babu, Sarath Reddy and Nair have been charge-sheeted by the ED and are in jail.
The ED has alleged that the “south group” paid kickbacks to the tune of Rs100 crore in advance to Nair, who was managing the scheme on behalf of AAP leaders. The ED has also claimed that Nair was personally involved in handling advertisement- and hoarding-related works and paying cash to volunteers during the Goa campaign.
“In lieu of this advance kickback payment,” said the ED, “Nair ensured that the south group secured a stake in wholesale businesses as they had no base in Delhi liquor business. He ensured that they were allowed to hold multiple retail licences over and above what was permissible as per the excise policy and that they were given other undue favours.’’
The ED recorded Babu’s statement on February 23. He allegedly spoke of a political understanding between Kavitha and Sisodia, and her meetings with Nair. Senior counsel Samudra Sarangi, who is representing Nair, refused to comment as the matter was in court.
As investigators continue to dig deeper, the challenges are mounting with clashing interests and political pressures leading to newer twists and turns in the case. Recently, Pillai, who is a Hyderabad-based businessman, retracted his statement to the ED that Kavitha was part of the meetings with Nair and that he was representing her in one of the liquor firms. The ED has challenged his claim and told the court that he has filed the retraction under pressure.
The ball will be rolling for some time before the charges against Sisodia and others are supported with corroborating evidences in a court of law. If found true, the alleged liquor scam is expected to snowball into a major controversy for the AAP, with its impact spilling outside Delhi. Also, there is another case hanging over Sisodia―allegations of espionage through the AAP government’s ‘feedback unit’. The ministry of home affairs had in February given sanction to the CBI to prosecute Sisodia in the case.
In a handwritten letter from Tihar jail, Sisodia had said that imprisonment may pose difficulties for him, but it cannot break his spirit. Kejriwal, meanwhile, has said that the AAP’s comeback will be stronger.