SIT arrests former Andhra govt officials in ₹3,200-crore liquor case
The arrest of the two accused took place within hours of the Supreme Court dismissing their petitions seeking anticipatory bail in the alleged liquor scam
The Special Investigation Team (SIT) of the Andhra Pradesh police probing the ₹3,200 crore liquor scam that allegedly took place during the previous YSR Congress party government on Friday arrested retired IAS officer K Dhanunjaya Reddy and another retired official P Krishna Mohan Reddy, both accused in the case, people familiar with the matter said.
The arrest of the two accused took place within hours of the Supreme Court dismissing their petitions seeking anticipatory bail in the alleged liquor scam. While Dhanunjaya Reddy was secretary in the chief minister’s office (CMO), Krishna Mohan Reddy was the officer on special duty (OSD) to former chief minister Y S Jagan Mohan Reddy.
According to a senior police official, the SIT authorities formally declared the arrest of the two accused in the evening, after questioning them for nearly nine hours for the second successive day. “They will be produced before the special court for the Anti-Corruption Bureau (ACB) cases in Vijayawada late in the night or on Saturday morning,” the official said.
Earlier in the day, the Supreme Court denied anticipatory bail to Dhanunjaya Reddy and Krishna Mohan Reddy in the alleged liquor scam.
A division bench of the Supreme Court comprising Justice J B Pardiwala and R Mahadevan dismissed the petitions of the two accused seeking anticipatory bail, stating that the investigation into the alleged liquor scam is at a crucial juncture and granting anticipatory bail might prejudice the case.
The bench also dismissed the anticipatory bail petition of another accused Govindappa Balaji, full-time director of Bharati Cements owned by Jagan Mohan Reddy, as he was already arrested by the Andhra police and is presently in judicial remand. “He can file a separate application in the lower court for regular bail, which would be considered on its merits,” the bench said.
Senior advocates Abhishek Manu Singhvi, Vikas Singh and Siddharth Dave who appeared for Krishna Mohan Reddy, Dhanunjay Reddy and Balaji respectively, alleged political bias against the accused persons by the present state government.
Senior advocates Mukul Rohatgi, Siddharth Luthra, and Siddharth Agarwal appeared for the State of Andhra Pradesh. They vehemently opposed the grant of anticipatory bail as it would prejudice their investigation at this crucial stage.
On March 6, the SIT submitted a memo in the special court for Anti-Corruption Bureau (ACB) cases in Vijayawada, naming Dhanunjay Reddy, Krishna Mohan Reddy and Govindappa as accused in the first information report registered with Crime Investigation Department (CID) on September 23, 2024, taking the overall accused in the case to 33.
While Dhanunjaya Reddy was listed as A-31, Krishna Mohan Reddy as A-32, and Govindappa Balaji as A-33. The accused were booked under Section 409 (criminal breach of trust), 420 (cheating) and 120 (B) (criminal conspiracy) of Indian Penal Code.
The SIT told the court that these individuals played key roles on behalf of the then government leadership in planning a policy conducive to collecting bribes and in managing the bribe collection network.
For the last two days, the SIT authorities grilled both Dhanunjaya Reddy and Krishnamohan Reddy and asked them about the massive inflow of funds into the personal accounts and businesses of their family members, close associates, and benamis during 2019–24.
The SIT also showed them suspicious transactions linked to accounts of their relatives and associated companies, to which they reportedly denied any connection.
Meanwhile, the Enforcement Directorate (ED), which is probing the alleged money-laundering in the liquor scam, sought custody of Raj Kesireddy, the prime accused in the case, who is presently in judicial remand.
The ED, which filed a petition in the special court for Anti-Corruption Bureau (ACB) cases in Vijayawada on Thursday, submitted relevant records to the court on Friday seeking custody of the prime accused to question on the issue of money laundering.
The ED has identified that nearly ₹3,200 crore in bribes collected from major liquor supply companies and distilleries were routed through shell and fictitious companies across multiple layers to ultimately reach the end beneficiaries. Investigators are now preparing to unearth the origins of these funds.
