Arvind Kejriwal led government caused a loss of more than Rs 2000 crore to the exchequer in the Liquor Policy Scam
NEW DELHI: One of the most damaging blows to AAP’s credibility has come in the form of the Comptroller and Auditor General (CAG) report on Delhi’s liquor excise policy. The report highlights significant lapses and raises serious allegations of corruption, with an estimated loss to the public exchequer of Rs 2,026 crores.
The CAG report on Delhi’s liquor excise policy highlights several critical findings that expose significant lapses and irregularities. A major revelation is the estimated ₹2,026crore revenue loss incurred due to suboptimal policy implementation. The policy objectives, which aimed to streamline the liquor trade and maximize revenue, were not achieved, as deviations from the planned objectives were evident. Recommendations provided by an expert panel were overlooked by the Group of Ministers (GoM) led by Manish Sisodia, leading to flawed decision-making processes.
Additionally, the bidding process was compromised as all entities were allowed to participate despite existing complaints. The financial condition of bidders was not adequately scrutinized, resulting in the issuance of licenses to unsuitable entities. Furthermore, licenses were granted even in cases of clear violations, and no penalties were imposed on violators, showcasing a lack of accountability. Transparency was another major issue, with pricing mechanisms being unclear and key decisions taken without the necessary approval from the cabinet or the Lieutenant Governor (LG).
The report also identified procedural gaps, such as the failure to present excise rules before the legislative assembly for ratification. These lapses indicate systemic inefficiencies and highlight the need for stricter governance, better oversight, and enhanced accountability in policy formulation and execution.
Financial Impact Breakdown
➢ Failure to retender surrendered retail licenses caused a loss of ₹890 crores.
➢ Exemptions granted to zonal licensees led to a revenue loss of ₹941 crores.
➢ A license fee waiver of ₹144 crores, citing COVID restrictions, contradicted tender terms that placed commercial risks on licensees.
➢ Incorrect collection of security deposits resulted in an additional ₹27 crores in losses.
The report also highlighted operational lapses, such as the absence of quality assurance measures like batch testing facilities and laboratories, and a failure to ensure equitable distribution of retail outlets.
Despite the counterclaims, AAP has struggled to provide substantial arguments to refute the allegations. The party’s defensive stance and the absence of clear answers have only fueled skepticism. With the Delhi Assembly elections approaching, AAP faces mounting pressure as these allegations could significantly impact voter sentiment.
Leadership Under Scrutiny
Key figures in AAP, including Delhi Chief Minister Arvind Kejriwal and his trusted ally, Deputy Chief Minister Manish Sisodia, have found themselves embroiled in legal battles. Their prolonged stints in jail have not only dented their reputations but also disrupted Delhi’s administrative operations.
Adding to the party’s woes, the appointment of Lieutenant Governor (LG) VK Saxena, who has taken an active role in governance, has led to frequent clashes with the AAP government. This ongoing tussle between the LG and the state government has further deepened political tensions and created a challenging environment for effective governance.
Since its resounding victory in the 2020 Delhi Assembly elections, the Aam Aadmi Party (AAP) has faced a series of challenges that have cast doubts on its governance and political future. Securing a second consecutive term with an overwhelming 62 out of 70 seats, AAP’s image as allegations of financial irregularities and unethical practices have severely impacted a party built on anticorruption ideals. These issues have raised significant concerns among citizens and political observers alike.
The issues surrounding the excise policy have not only revealed financial irregularities but also underscored broader governance challenges within AAP. The CAG emphasized the need for accountability, urging authorities to investigate lapses and fix responsibility. The suboptimal implementation of the excise policy, coupled with a lack of scrutiny over business entities and exclusivity arrangements between zonal licensees and wholesalers, has drawn attention to systemic weaknesses in decision-making and oversight.
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