BRS MLC K Kavitha and ‘South Group’ in the Delhi liquor policy case

According to various chargesheets filed by the ED and the CBI, the 'South Group' played an important role in the alleged scam.

BySouth First Desk

Published Mar 15, 2024 | 8:48 PM Updated Mar 15, 2024 | 8:48 PM

Delhi HC dismisses Kavitha's plea in excise policy scam

The Enforcement Directorate (ED) arrested BRS MLC K Kavitha in Hyderabad on Friday, 15 March, under sections of the Prevention of Money Laundering Act (PMLA). Her arrest has brought renewed focus on the involvement of the so-called “South Group” in the Delhi excise police scam.

According to various chargesheets filed by the ED and the CBI, both probing irregularities in the now-scrapped Delhi Excise Policy 2021-2022, the “South Group” played an important role in the alleged scam

According to the ED, Aam Aadmi Party (AAP) former communication head Vijay Nair received kickbacks to the tune of ₹100 crore on behalf of AAP leaders from the aforementioned “South Group” — as termed in the statements of various persons recorded during the investigation — to manipulate the Delhi excise policy to benefit them.

Also Read: ED arrests BRS MLC K Kavitha in Delhi liquor policy case

The South Group

According to the CBI, the prominent names in the “South Group” include former YSRCP MP Magunta Srinuvasulu Reddy, his son Magunta Raghava Reddy, and Kavitha, daughter of BRS chief and former Telangana chief minister K Chandrashekar Rao.

Hyderabad-based businessman Arun Ramachandran Pillai was also arrested by the ED on the contention that he was among the three key representatives of Kavitha.

Two other representatives of Kavitha were said to be beauty salon chain owner Abhishek Boinpally and chartered accountant Butchibabu Gorantla.

The ED also mentioned the name of Hyderabad-based industrialist P Sharath Chandra Reddy in its second prosecution complaint filed in the court.

Apart from Sharath Chandra Reddy and Abhishek Boinpally, Vijay Nair of the AAP and Benoy Babu, an official of the liquor company Pernod Ricard, allegedly played a crucial role in the Delhi liquor scam.

The ED had questioned Butchibabu Gorantla to uncover details regarding the “South Group”. The main focus was on his association with Kavitha.

The ED interrogated Butchibabu after a special court for CBI cases in New Delhi granted the agency permission on 22 February, 2023, to question him for two days in connection with the case.

Also Read: Court allows Raghava Magunta to turn approver in corruption case

The alleged kickbacks

The investigation agency also said kickbacks were paid in advance to AAP leaders through Nair by the “South Group” as part of an agreement between them.

As against kickbacks that were paid, the “South Group” secured uninhibited access and undue favours, besides attaining stakes in established wholesale businesses and multiple retail zones over and above what was allowed in the policy, said the CBI charge sheet.

During its probe, the ED recorded the statement of Butchibabu, in which he said: “There was a political understanding between K Kavitha and the chief minister (Arvind Kejriwal) and deputy chief minister (Manish Sisodia). In that process, K Kavitha also met Vijay Nair on 19-20 March, 2021.”

Vijay Nair was said to be the key link between the “South Group” and the party in power in Delhi.

To recover the kickbacks, the partners of the “South Group” were given a 65 percent stake in Indospirit in collusion with Sameer Mahendru, the owner of the firm.

The ED also arrested Indospirit Managing Director Sameer Mahendru.

Also Read: SC issues notice to ED on Abhishek Boinpally’s plea on arrest legality

The partnership

The formation of the aforementioned partnership was directed by Nair on the assurance of giving the wholesale business of Pernod Richard to Indospirit, the investigative agency contended.

Dinesh Arora, a close associate of Vijay Nair, in his statement dated 1 October, 2022, revealed that the “South Group” was supposed to get its advance money back from three major wholesalers.

He too told the ED that IndoSpirits was an entity controlled by the “South Group”, therefore the recoverable money was directly in their control.

Dinesh Arora also revealed in his statement on 18 November, 2022, that Vijay Nair, through his interaction with Benoy Babu of Pernod Ricard, ensured that Pernod Ricard’s business was given to Indospirit in exchange for the ₹100 crore paid by the “South Group”.

In November 2022, the CBI filed a charge sheet at the Rouse Avenue District Court in Delhi listing seven persons — Vijay Nair, Abhishek Boinapally, Arun Ramachandra Pillai, Sameer Mahendru, Gautam Mootha, Kuldip Singh, and Narendra Singh — naming them as accused in the case.

Sreenivasulu Reddy, his son Raghava Reddy, Sharath Chandra Reddy, Buthcibabu Gorantla, and Dinesh Arora have turned approvers in the case.

(Edited by Muhammed Fazil)