Published Mar 07, 2026 | 12:10 AM ⚊ Updated Mar 07, 2026 | 12:10 AM
Enforcement Directorate.
Synopsis: The Directorate of Enforcement, Hyderabad, has attached assets worth ₹441.63 crore in connection with the alleged Andhra Pradesh liquor scam. The agency said its probe has so far uncovered a money trail of ₹1,048.45 crore in kickbacks allegedly paid by distilleries in cash, gold and other benefits.
The Directorate of Enforcement (ED), Hyderabad, has provisionally attached movable and immovable properties worth ₹441.63 crore in connection with the alleged Andhra Pradesh liquor scam under the provisions of the Prevention of Money Laundering Act, 2002 (PMLA).
The agency said its probe has so far uncovered a money trail of ₹1,048.45 crore in kickbacks allegedly paid by distilleries as cash, gold and other benefits.
In a press communique on Friday, 6 March, the ED said the attached assets belong to Kessireddy Rajasekhara Reddy, his family members and related entities; Booneti Chanakya and his associated entities; relatives and entities linked to Donthireddy Vasudeva Reddy; along with several other individuals and companies allegedly involved in the case.
The attached properties include bank balances, fixed deposits, land parcels and other immovable assets.
The ED initiated its investigation based on an FIR registered by the Andhra Pradesh Crime Investigation Department. The case was registered under Sections 120-B, 409 and 420 of the Indian Penal Code, 1860, alleging a loss of around ₹4,000 crore to the state exchequer.
According to the ED’s investigation, before 2019 the liquor trade in Andhra Pradesh was regulated through an automated software system that digitally tracked procurement, supply and sales of liquor, creating a verifiable electronic audit trail.
After the 2019 Assembly elections, the newly formed state government brought retail liquor outlets under government control through outlets operated by the Andhra Pradesh State Beverages Corporation Limited (APSBCL). These outlets were known as Government Retail Outlets (GROs).
The ED alleged that, as part of a criminal conspiracy, the automated procurement system was deliberately disabled and replaced with a manual system. Investigators said this change gave APSBCL officials sweeping discretionary powers to issue Orders for Supply (OFS).
Under the manual OFS regime, investigators said established liquor brands were sidelined or removed from the market, while certain “favoured” brands received preferential allocations in exchange for kickbacks.
The ED said the syndicate also promoted “similar-sounding brands” (SSBs) with artificially inflated base prices. This pricing manipulation allegedly let distilleries producing these brands generate surplus margins, which were used to pay illegal commissions demanded by the cartel.
Investigators said distilleries were forced to pay illegal kickbacks ranging from 15% to 20% of the basic price per liquor case to obtain OFS approvals. Manufacturers who refused to comply allegedly faced coercive actions such as withholding legitimate payments and rejecting supply orders.
Communications related to the alleged demand and collection of kickbacks were reportedly carried out through encrypted Voice-over-Internet-Protocol (VOIP) calls and applications such as Signal to conceal the identities of key operatives.
The ED named individuals including Muppidi Avinash Reddy (also known as Sumeeth) and Mohammed Saif among those allegedly involved in facilitating these communications.
The ED said its investigation found that Kessireddy Rajasekhara Reddy, along with members of a liquor syndicate, orchestrated a large-scale scam involving the procurement and distribution of liquor in Andhra Pradesh.
Investigators said the alleged manipulation of APSBCL’s procurement system caused a wrongful loss to the state exchequer. They added that the proceeds of crime generated from the scheme were distributed among members of the syndicate.
According to the ED, Rajasekhara Reddy, in collusion with Booneti Chanakya, Muppidi Avinash Reddy, Tukekula Eswar Kiran Kumar Reddy, Paila Dileep and Saif Ahmad, allegedly collected kickbacks totalling about ₹3,500 crore.
The investigation also found that the accused established or acquired control over several distilleries, which were used as special purpose vehicles to generate proceeds of crime.
Companies such as Adan Distillery Pvt. Ltd., Leela Distilleries Pvt. Ltd., and U.V. Distilleries were allegedly operated under the effective control of the syndicate and given disproportionately large business volumes.
Another alleged source of illicit revenue was the manipulation of liquor transportation contracts awarded by APSBCL.
The ED said a centralised transportation tender was awarded to Sigma Supply Chain Solutions Pvt. Ltd. at rates significantly higher than earlier depot-wise transportation costs.
Although the contract was officially awarded to the company, members of the liquor syndicate, including T. Eswar Kiran Kumar Reddy and Saif Ahmad, allegedly exercised operational control.
Investigators alleged that a substantial portion of the contract payments was diverted to entities such as TEKKR, Arroyo and Ezyload, which were used to launder the proceeds of crime.
The ED further found that several distilleries engaged vendors and fictitious entities for the supposed supply of raw materials and packaging items.
These vendors allegedly issued inflated or fake invoices for goods that were never supplied, which enabled the conversion of banking funds into unaccounted cash.
The ED said the proceeds of crime were also invested in real estate and personal assets. Funds were allegedly routed through entities such as Eshanvi Infra Projects Pvt. Ltd., ED Entertainment, Uni Corporate Solutions Pvt. Ltd. and Tag Developers to acquire land parcels and undertake residential development projects.
Investigators also said fabricated and backdated agreements were used to portray illicit funds as legitimate business income.
To conceal the origin of the proceeds of crime, the syndicate allegedly used a network of shell and front companies including Olwick, Kripati, Nysna Multiventures, Arroyo, Ezyload and DCart.
These entities were reportedly used to layer funds through a complex web of financial transactions with no legitimate business purpose, which disguised the illicit origin of the funds.
The ED said the manipulation of procurement and supply mechanisms enabled the syndicate to generate illegal revenues of around ₹100 crore per month.
Investigators said physical cash kickbacks were collected and stored at multiple locations in Hyderabad, from where designated cash handlers moved or distributed the money.
The proceeds of crime were allegedly used to acquire immovable properties and personal assets for members of the syndicate and their associates. Investigators said a substantial portion of these funds has either been concealed or dissipated.
