Arvind Kejriwal arrested: What is Delhi excise policy case? | Explained

Delhi Chief Minister Arvind Kejriwal was arrested by the Enforcement Directorate on Thursday, March 21, in connection with a money laundering case related to the excise policy. 

Kejriwal, the national convenor of the Aam Aadmi Party (AAP), retracted his plea challenging the ED's arrest in the Supreme Court. Today, he appeared before a special court under the Prevention of Money Laundering Act (PMLA) as the ED sought his remand for further interrogation.

On 21 March, the Delhi High Court rejected Kejriwal's plea seeking protection from coercive action in the excise policy-linked money laundering case.

Later, the federal agency began conducting searches at Kejriwal’s residence in Civil Lines. The Delhi Chief Minister had till now skipped nine ED summons issued to him in the money laundering case.

The ED said Kejriwal was a "key conspirator" in the liquor scam case along with other ministers and AAP leaders, as it sought his 10-day custody from a court.

What is the Delhi excise policy case? 

The Arvind Kejriwal-led Delhi government had passed a new excise policy. The initiative was short-lived, lasting approximately a year and being bombarded by allegations of bribery and fraud. 

According to an Enforcement Directorate chargesheet, the Delhi Excise Policy (2021-22) was created by the top leaders of the Aam Aadmi Party to continuously generate and channel illegal funds to themselves.

In July 2022, Delhi Lieutenant Governor VK Saxena recommended a CBI probe into the alleged flouting of rules and procedural flaws when it came to the implementation of the policy. Following this, the ED and CBI had registered cases alleging that irregularities were committed while modifying the Excise Policy. 

The charges include granting undue favors to license holders, waiver or reduction of license fee, and extension of L-1 license without the competent authority's approval. The probe agencies alleged that beneficiaries diverted "illegal" gains to the accused officials and made false entries in their books of account to evade detection.

The AAP, however, insisted that the new policy was formulated to ensure the generation of optimum revenue, eradicate the sale of spurious liquor or non-duty paid liquor in Delhi, and improve overall user experience.

Also read: Live updates on Delhi CM Arvind Kejriwal's arrest

The CBI inquiry was recommended on the findings of the Delhi chief secretary's report filed in July showing prima facie violations of the GNCTD Act 1991, Transaction of Business Rules (ToBR)-1993, Delhi Excise Act-2009, and Delhi Excise Rules-2010.

According to a report by the Delhi chief secretary, Sisodia undertook major decisions and actions that were 'in violation of the statutory provisions and the notified excise policy that had huge financial implications'.

The ED on March 22 also alleged that Kejriwal received several crores of rupees as kickbacks from the 'South group' for formulating and implementing the Delhi Excise Policy.

Arvind Kejriwal acted as a middleman between the 'South group' and the accused in the liquor scam, ED told the Delhi court while seeking Delhi CM's 10-day custody.

(With inputs from agencies)