Delhi Court grants bail to Chartered Accountant (CA) in Liquor Scam

The Central Bureau of Investigation (CBI) detained chartered accountant Butchibabu Gorantla in connection with the suspected Delhi liquor policy fraud on Monday, and the Rouse Avenue Court granted him bail. Gorantla is based in Hyderabad.

The case has brought to light the name of Butchibabu Gorantla, a former auditor for Telangana Chief Minister K Chandrashekar Rao’s daughter and MLC K Kavitha.

Butchibabu was granted bail by Special Judge MK Nagpal on Monday and was instructed to turn in his passport.

In connection with the suspected Delhi liquor policy fraud, the same court on Monday placed Manish Sisodia, a former deputy chief minister of Delhi, under judicial custody till March 20.

When granted bail, the court also placed a restriction on the accused, ordering them not to tamper with the evidence or influence the witnesses.

The Enforcement Directorate (ED) was recently given permission by Rouse Avenue Court to question Butchibabu Gorantla while he was being held in detention. In the money laundering case involving the Excise Policy, ED had filed an application to interview him and record his statement.

On February 8, the CBI detained Butchibabu in relation to the Delhi Excise Policy investigation.

The Delhi Excise Policy was allegedly developed and implemented by the accused CA, who is also suspected of defrauding Hyderabad-based wholesale and retail licensees and their beneficial owners. This was disclosed by the CBI in a statement following the accused CA’s detention.

Delhi Excise Policy, 2021–2022, which was designed by the senior Aam Aadmi Party (AAP) leaders to continually generate and channel unlawful funds to themselves, was exposed by the Prevention of Money Laundering Act (PMLA) inquiry, according to a recent chargesheet from the ED.

The extent of AAP leaders’ participation in and mitigation of the criminal conduct carried out by the accused contained in the subject Prosecution Complaint, according to ED, further substantiates their conception and scheme of the scam.

Due to a criminal conspiracy involving the top AAP officials to obtain bribes from the firms, the policy encouraged cartel formations through the back door and gave extravagant wholesale profit margins of 12% and enormous retail profit margins of 185%, according to the ED.

For convenience, let’s name the organisation that Vijay Nair got bribes from the South Group on behalf of AAP officials the South Group (as termed in the statements of various persons recorded during the investigation, whose prominent persons are Magunta Srinivasulu Reddy, Raghav Magunta, Sarath Reddy and K Kavitha).

This year, the ED and the CBI filed complaints stating that irregularities were committed when changing Delhi’s Excise Policy, improper favours were given to licence holders, the licence fee was waived or lowered, and the L-1 licence was prolonged without the responsible authority’s consent. In order to avoid detection, the recipients produced fictitious entries in their books of accounts and channelled “illegal” gains to the charged authorities.

As claimed, the Excise Department made the unapproved decision to refund the victorious tenderer’s approximately Rs 30 crore earnest money deposit. Despite the absence of an enabling provision, Covid-19—which is claimed to have cost the exchequer Rs 144.36 crore—was the reason for the waiver on tendered licence fees that was granted from December 28, 2021, to January 27, 2022. The Union Home Ministry had been referred to it after Delhi Lieutenant Governor Vinai Kumar Saxena made the recommendation.

According to officials, prima facie evidence of violations of the GNCTD Act of 1991, the Transaction of Business Regulations (ToBR) of 1993, the Delhi Excise Act of 2009, and the Delhi Excise Rules of 2010 was shown in the Delhi Chief Secretary’s report, which was submitted in July.