CBI’s case against Manish Sisodia and AAP’s Excise Policy

A war of words between BJP and AAP following CBI’s search and seizure at Delhi deputy CM Manish Sisodia’s residence among other places has put focus on Delhi Govt's withdrawn Excise Policy

Queues outside a liquor shop in Delhi
Queues outside a liquor shop in Delhi

NH Web Desk

Even as the Opposition questioned the timing of CBI’s search and seizure at Manish Sisodia’s residence among other places, CBI named Sisodia as the first of the 15th accused in the so called ‘Excise Policy Scam’.

The central agency was called upon to investigate allegations of procedural lapses and giving undue benefits to select vendors causing revenue losses to the government. The charges were contained in a report sent to the Lieutenant Governor of Delhi by Delhi’s Chief Secretary.

The AAP Government in Delhi last year introduced a new excise policy effective from November, 2021 and reversed the existing policy introduced when Sheila Dikshit of the Congress was heading the Government. The policy was, however, withdrawn on July 31, 2022 following the allegations and the old policy reinstated by AAP Government.

AAP has accused the LG and the Union Government of politically motivated action. ED and CBI’s action against Delhi’s health minister and now him, Manish Sisodia has claimed, was designed to defame AAP and Delhi’s chief minister Arvind Kejriwal. Addressing a press conference Sisodia claimed the ruling BJP at the Centre was alarmed at the former’s increasing popularity.

He also claimed that the Preliminary Enquiry (PE) or FIR lodged by the CBI mentions alleged corruption involving just one Crore of Rupees.

While withdrawing the new excise policy, Sisodia had admitted that it was being withdrawn due to policy flaws. While the old excise policy yielded Rs 6000 crore to the Delhi Government, the new policy was expected to yield Rs 9,500 crore annually. The old policy allowed both government-owned vends and private liquor outlets. The new policy did away with government vends, reduced the dry days from 21 to three and promised more vends.

The new policy encouraged competition between private retailers, prices plunged and vendors offered discounts to consumers. The government also promised home delivery of liquor and proposed to reduce the minimum age required for buying liquor from 25 to 18. Another feature of the proposals was to allow liquor vends to operate round the clock.

But AAP was accused of abandoning the old practice of allowing liquor vends only after the consent of people in the neighbourhood. Although the new policy initially provided for a 1000 vends in the national capital, the number was revised to 849. But bids were received for only 639 vends, out of which 464 remained.

While the exact loss, if any, to the exchequer due to the new policy is yet to be spelt out, the primary allegations against AAP’s withdrawn excise policy are as follows:

1. In October, 2021 the Finance Department sought a report on the impact of the new policy on profit margins of wholesalers and retailers. But Manish Sisodia is said to have overruled the impact study

2. Dry days were reduced from 21 to 3 without charging vendors extra for the increase in selling days

3. Vendors were refunded amounts (estimates in the media vary from Rs 144 Crore to Rs 175 Crore) to compensate low sales during to the pandemic though there was no provision in the policy for such compensation

4. While the policy laid down that if vendors failed to complete formalities, their deposits would be forfeited, the lowest tenderer for the Airport Zone was refunded Rs 30 crore when it failed to obtain a No Objection certificate

5. Waiver granted on imported beer is said to have caused a loss of Rs 250 crore

6. Retail licences were extended for four months from April 1, 2022 to July 31, 2022 without charging the vendors anything extra.

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