Their arrests came after the Supreme Court denied them anticipatory bail on 13 May, stating that there was prima facie evidence against them.
Published May 16, 2025 | 11:01 PM ⚊ Updated May 16, 2025 | 11:01 PM
Former Chief Minister YS Jagan Mohan Reddy
Synopsis: The Special Investigation Team has arrested former IAS officer K Dhanunjaya Reddy and ex-OSD P Krishna Mohan Reddy in connection with the alleged ₹3,200 crore liquor scam under the previous YSRCP government in Andhra Pradesh. They are accused of enabling large-scale irregularities in liquor distribution and funnelling kickbacks through shell companies and state-run bodies. The arrests came after the Supreme Court refused their request for anticipatory bail.
The Special Investigation Team (SIT) probing the alleged ₹3,200 crore liquor scam under the previous Yuvajana Sramika Rythu Congress Party (YSRCP) government in Andhra Pradesh arrested two key individuals on Friday, 16 May – former IAS officer K Dhanunjaya Reddy and former Officer on Special Duty (OSD) P Krishna Mohan Reddy.
The case involves alleged irregularities in the formulation and implementation of Andhra Pradesh’s liquor policy, particularly through the Andhra Pradesh State Beverages Corporation Limited (APSBCL).
Dhanunjaya Reddy, named as Accused No. 31, served as Secretary in the Chief Minister’s Office (CMO) during Jagan Mohan Reddy’s tenure from 2019 to 2024.
He is reported to have held significant influence, managing access to the CMO, influencing key decisions, and overseeing internal party matters.
Krishna Mohan Reddy, listed as Accused No. 32, worked as OSD to the former Chief Minister.
Dhanunjaya Reddy is accused of using his position to enable irregularities in liquor distribution and supply chains, leading to large-scale financial misappropriation.
Krishna Mohan Reddy is alleged to have acted as a middleman for collecting bribes, routing money through shell companies and coordinating with distilleries and APSBCL officials.
Their arrests came after the Supreme Court denied them anticipatory bail on 13 May, stating that there was prima facie evidence against them.
The court granted interim protection from arrest until 16 May and directed them to appear before the SIT.
The two appeared before SIT officers in Vijayawada on 14 May, where they were questioned about their alleged roles in the scam, including the flow of kickbacks from distilleries.
They returned for further questioning on 15 May. As their interim protection expired on 16 May, the SIT took them into custody.
The Telugu Desam Party (TDP)-led National Democratic Alliance (NDA) government, which came to power in 2024, set up the SIT last November to investigate the alleged scam.
The Enforcement Directorate (ED) is also conducting a parallel probe under the Prevention of Money Laundering Act (PMLA), and has named 33 accused, including Dhanunjaya Reddy and Krishna Mohan Reddy.
Others named in the case include Raj Kesireddy (A-1), IT Advisor to Jagan Mohan Reddy, who has already been arrested, and Sajjala Sridhar Reddy (A-6), Managing Director of Spy Agro Industries, currently in custody.
Several others linked to shell companies and alleged policy manipulation are also under investigation.
Raj Kesireddy was arrested by the SIT on 21 April. His interrogation reportedly pointed to the involvement of both Dhanunjaya Reddy and Krishna Mohan Reddy.
The SIT submitted a memo to the Anti-Corruption Bureau (ACB) Special Court in Vijayawada on 7 May, formally naming Dhanunjaya Reddy, Krishna Mohan Reddy, and Govindappa Balaji as accused, bringing the total number of accused in the case to 33.
The SIT also recently arrested Govindappa Balaji, full-time Director of Bharati Cements, who has been named as Accused No. 33.
YSRCP leader and former minister Botsa Satyanarayana has condemned the arrests, accusing the current Chief Minister N Chandrababu Naidu of using the investigation for political vendetta.
“It is nothing but wreaking political vengeance against the officials,” he wrote in a post on X.
He alleged that arrests were being made “without any evidence,” claiming that authorities were using threats and coercion to “extract false statements.”
“Such undemocratic practices brought in by Chandrababu Naidu are dangerous to the state,” he added.
(Edited by Dese Gowda)
