ED searches in Rs 3,500 crore Andhra liquor ‘scam’ case

The Enforcement Directorate (ED) on Thursday, 18 September, launched nationwide searches in connection with its money laundering probe into an alleged ₹3,500 crore liquor scam in Andhra Pradesh, purportedly linked to the previous YSRCP government, officials said.

Raids were conducted at about 20 locations across Telangana, Andhra Pradesh, Tamil Nadu, Karnataka, and Delhi-NCR, covering premises of individuals and entities accused of facilitating kickbacks through inflated or bogus invoices.

Among those searched were Arete Institute of Medical Sciences, Shree Jewellers Eximp, N.R. Udhyog LLP, The India Fruits Pvt. Ltd. (Chennai), Venkateshwara Packaging, Suvarna Durga Bottles, Rao Saheb Boorugu Mahadev Jewellers, Ushodaya Enterprises, and Mohan Lal Jewellers (Chennai), according to officials.

The ED case was registered under the Prevention of Money Laundering Act (PMLA) based on a Special Investigation Team (SIT) FIR filed by Andhra Pradesh Police. Police have already filed three chargesheets, naming several accused, including YSRCP MP P.V. Midhun Reddy, who has been arrested.

The chargesheets allege that former chief minister Y.S. Jagan Mohan Reddy was among the beneficiaries, reportedly receiving kickbacks of ₹50–₹60 crore per month. However, Jagan has not been named as an accused in the prosecution complaint.

Investigators claim Jagan chaired a crucial meeting in July 2019, where the state’s new liquor policy was finalised, handing retail control to the government-run AP State Beverages Corporation Ltd (APSBCL). Police further alleged that D. Vasudeva Reddy, an IRTS officer and accused in the case, was appointed APSBCL’s Managing Director with Jagan’s backing, despite being recommended for other posts by senior officials.

The chargesheets also note that kickbacks were laundered through low-profile individuals, such as office boys and employees, who were used as conduits to circulate illicit funds. Former senior bureaucrat Rajat Bhargava, then special chief secretary for excise, allegedly raised repeated alarms about irregularities, but his warnings were ignored by the Chief Minister’s Office.

The YSRCP has dismissed the allegations, calling them “baseless”.

Police maintain that large-scale irregularities were uncovered in the 2019 Excise Policy modifications, and that portions of the illicit proceeds were disguised as salaries and transferred through shell accounts of low-level employees.

With PTI inputs