Sisodia to stay in jail as SC denies bail over excise case

ByAbraham Thomas, New Delhi
Oct 31, 2023 05:18 AM IST

The Supreme Court has denied bail to former Delhi deputy chief minister Manish Sisodia in a case related to financial irregularities.

The Supreme Court on Monday refused bail to former Delhi deputy chief minister Manish Sisodia in connection with allegations of financial irregularities in the now-scrapped excise policy, finding that at least one charge of windfall gains of 338 crore made by wholesalers was tentatively established.

Former Delhi deputy chief minister Manish Sisodia was denied bail in the liquor case on Monday. (HT_PRINT)
Former Delhi deputy chief minister Manish Sisodia was denied bail in the liquor case on Monday. (HT_PRINT)

The decision comes as a blow to the Aam Aadmi Party (AAP) and Sisodia who have maintained that the case was nothing but a political ploy to derail Delhi’s governance.

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“There is one clear ground or charge in the complaint filed under the Prevention of Money Laundering Act (PMLA), which is free from perceptible legal challenge and the facts as alleged [of 338 crore being earned by liquor wholesaler under the new excise policy] are tentatively supported by material and evidence,” said a bench of justices Sanjiv Khanna and SVN Bhatti, referring to the charge sheet filed by the Enforcement Directorate (ED).

This was found by the court to be “equally relevant” in the charge sheet filed by the Central Bureau of Investigation (CBI) under the Prevention of Corruption Act and the Indian Penal Code.

The CBI charge sheet said the 338 crore earned by wholesale distributors in the 10 months that the now-scrapped policy was in place constituted an offence defined under Section 7 of the Prevention of Corruption Act, which relates to a public servant being bribed.

“We have dealt with certain aspects of the case which are doubtful. But one aspect, with regard to transfer of money of 338 crore, is tentatively established. Therefore, we have dismissed the bail application,” the bench observed orally in open court.

To be sure, the two-judge bench of the top court also punched several holes in the arguments and evidence presented by federal agencies probing the allegations, and asked that trial be completed in six to eight months. It allowed Sisodia to seek bail again in three months if the proceedings drag on at a “snail’s pace”, cautioning against prolonged pre-trial incarceration. The top court also granted Sisodia the liberty to seek interim bail before the trial court in case of his ill-health or due to his wife’s ill health.

The Supreme Court order sparked a political storm with the Bharatiya Janata Party (BJP) demanding chief minister Arvind Kejriwal’s resignation and the AAP saying it will consider seeking a review.

Delhi cabinet minister Atishi said: “We respect the Supreme Court but respectfully disagree with the court’s decision given today. We will explore all available legal options before taking further action. The AAP is an honest party, and the Delhi government has not been involved in any corruption cases to date.”

Delhi BJP chief Virendra Sachdeva said the top court’s order was “a vindication of the BJP’s allegations”.

Sisodia was the first prominent AAP leader arrest in connection with the excise policy, in which the federal agency allege kickbacks were paid. The policy was rolled out for the 2021-22 financial year in November 2021, marking the exit of the government from retail sales of alcohol and allowing private companies to bid for licenses. The objective, the Delhi government said, was to improve the buying experience for citizens by allowing market competition to raise standards.

But the policy was scrapped when Delhi’s lieutenant governor VK Saxena asked for an investigation, citing a report by the chief secretary who alleged irregularities. The AAP and the Capital’s elected government have rejected the charges, alleging it to be a ploy by the BJP-controlled Union government to target its rival.

ED has so far arrested 14 people, including Sisodia and Rajya Sabha MP Sanjay Singh, and filed five charge sheets. CBI, which is conducting a parallel corruption probe in the matter, has filed two charge sheets in the case.

Sisodia was first arrested on February 27 by CBI, and then by ED in a money laundering case stemming from the CBI FIR on March 9 after questioning him in Tihar Jail. Sisodia resigned from the Delhi cabinet on February 28.

In its 41-page order, the court found there was one clear ground or charge in the complaint, related to alleged benefits of 338 crore by liquor wholesalers.

The agencies argued that in the 10 months of the policy, wholesale distributors had earned 581 crore as fixed fee. The one-time licence fee collected from 14 wholesale distributors was about 70 crore. Under the old policy, 5% commission was payable to the wholesale distributors or licensees, but this was increased to 12% in the new policy.

This difference, in addition to 70 crore, constituted the proceeds of crime, an offence punishable under the PMLA, the ED charge sheet said.

“The proceeds of crime were acquired, used and were in possession of the wholesale distributors who have unlawfully benefitted from illegal gain at the expense of the government exchequer and the consumers/buyers,” the charge sheet added.

“Thus, the new excise policy was meant to give windfall gains to select few wholesale distributors, who in turn had agreed to give kickbacks and bribes,” the CBI charge sheet said.

The agencies alleged that the excess profit margin benefit could have been passed on to consumers but instead was a conspiracy to ensure “massive illegal gains” to a few private players, individuals or entities.

“In view of the aforesaid discussion and for the reasons stated, we are not inclined to accept the prayer for grant of bail at this stage,” the judges held.

In their order, the judges also pointed out several holes in the case against Sisodia. They noted that there was no mention of an alleged 2.2 crore bribe in the original CBI case, said another alleged 100 crore paid by the so-called South Group was “a matter of debate”, and couldn’t find the presence of any direct or indirect link with Sisodia to show that a sum of 45 crore (out of the 100 crore kickback) went to the AAP to fund the 2022 Goa elections.

“Prima facie, there is lack of clarity, as specific allegation on the involvement of the appellant Manish Sisodia, direct or indirect, in the transfer of 45 crore to AAP for the Goa elections is missing,” the judges held.

“The assertion in the ED complaint that kickback of 100 crore was actually paid by the liquor group (South Group) is somewhat a matter of debate,” they added.

The bench also cautioned against prolonged pretrial detention.

“Detention or jail before being pronounced guilty of an offence should not become punishment without trial. If the trial gets protracted despite assurances of the prosecution, and it is clear that case will not be decided within a foreseeable time, the prayer for bail may be meritorious,” it said.

The court held that the right to speedy trial is a facet of the right to life, it said.

“We give liberty to the appellant – Manish Sisodia to move a fresh application for bail in case of change in circumstances, or in case the trial is protracted and proceeds at a snail’s pace in next three months”.

“If any application for bail is filed in the above circumstances, the same would be considered by the trial court on merits without being influenced by the dismissal of the earlier bail application, including the present judgment,” it said.

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