Hyderabad, March 6: The Enforcement Directorate (ED) has taken significant action in the high-profile liquor scam investigation in Andhra Pradesh, temporarily freezing assets worth ₹441.63 crore. This move is part of a money laundering case initiated under the Prevention of Money Laundering Act, 2002.
The assets attached include those belonging to Keshireddy Rajasekhar Reddy, his family members, and associated companies, as well as Bouneti Chanakya and his related entities, along with relatives of Donthireddy Vasudev Reddy. The frozen assets comprise bank balances, fixed deposits, land plots, and other properties.
The investigation began following a complaint from the Principal Secretary of the Andhra Pradesh government. Subsequently, the Crime Investigation Department (CID) registered an FIR under various sections of the Indian Penal Code. Allegations suggest that a major scam linked to the liquor trade caused a loss of approximately ₹4,000 crore to the state treasury. The ED launched its inquiry based on this FIR, focusing on the money laundering angle.
The probe revealed that prior to 2019, liquor trade in Andhra Pradesh was regulated through a transparent and automated software system. This system digitally tracked the entire process of liquor purchase, supply, and sales, ensuring a clear electronic record of every transaction. However, following the formation of a new government after the 2019 assembly elections, the state took complete control over retail liquor sales, operating through government retail outlets managed by the Andhra Pradesh State Beverages Corporation Limited (APSBCL).
According to the ED’s investigation, a criminal conspiracy led to the dismantling of the old automated system, which was replaced by a manual one. This change granted APSBCL officials nearly unrestricted authority in issuing liquor supply orders. The inquiry also found that this manual system was used to discriminate against established liquor brands. Many popular brands received fewer orders or were nearly driven out of the market, while select ‘favored’ brands were given preferential treatment in exchange for bribes.
The investigation further uncovered that the liquor syndicate promoted the introduction of ‘look-alike brands’ in the market. The basic prices of these brands were artificially inflated, allowing distillery companies to reap additional profits. Allegedly, this extra money was used for bribery. The ED claims that distillery companies were coerced into paying illegal kickbacks of approximately 15 to 20 percent of the basic price for each case to secure supply orders.
Manufacturers who refused to pay these bribes faced various pressures, including canceled supply orders and withheld payments. To conceal bribery discussions, encrypted internet calls and secure messaging applications were reportedly used to keep the identities and roles of key individuals secret.
The ED alleges that Keshireddy Rajasekhar Reddy, along with accomplices, manipulated the liquor procurement and distribution system on a large scale. The agency claims this entire process resulted in a loss of around ₹3,500 crore to the government treasury. During this time, approximately ₹3,500 crore in bribes were allegedly collected, which were later distributed for personal gain.
The investigation also revealed that certain distillery companies were brought under the control of the syndicate, including Aden Distillery Private Limited, Leela Distilleries Private Limited, and U.V. Distillery. These companies allegedly received increased business advantages through political and administrative influence.
Additionally, the ED’s investigation found manipulations in contracts related to liquor transportation. The agency stated that APSBCL awarded a centralized transportation tender to Sigma Supply Chain Solutions Private Limited, which had significantly higher rates than previous contracts. Although the contract was in this company’s name, operations were reportedly controlled by individuals linked to the liquor syndicate.
The inquiry also discovered a network of shell companies and fake firms created to conceal the proceeds of the scam. Funds were transferred through multiple stages to hide their true origin, and these funds were also used to purchase real estate projects and private properties.
According to the ED, approximately ₹1,048.45 crore of the money trail has been traced so far. The agency indicates that the investigation is ongoing, and further actions cannot be ruled out in the future.
My name is Narendra Jijhontiya. I am an experienced content writer with several years of expertise in the field. Currently, I contribute to Daily Kiran, creating engaging and informative content across a variety of categories including TECHNOLOGY, health, travel, education, and automobiles. My goal is to deliver accurate, insightful, and captivating information through my words to help readers stay informed and empowered.
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