E-Paper
YSRCP MP sent to judicial custody in ₹3,200-crore liquor case
YSR Congress MP P V Midhun Reddy remanded to judicial custody till August 1 in ₹3,200 crore liquor scam, allegedly orchestrating key policy changes.
A special court for Anti-Corruption Bureau (ACB) cases in Vijayawada in Andhra Pradesh on Sunday remanded YSR Congress party MP P V Midhun Reddy to judicial custody till August 1, in connection with the ₹3,200 crore liquor scam that allegedly took place during the previous YSRCP government, people familiar with the matter said.
The special investigation team (SIT) of the Andhra Pradesh police, which arrested Midhun Reddy on Saturday night after seven hours of interrogation, produced him before the ACB court after the mandatory medical examination in the government hospital at Vijayawada.
The SIT told the court that the MP, named as accused no. 4 (A-4) in the case, was booked under Sections 409, 420, 384, 201 and 120 (B) r/w Section 34 and 37 of Indian Penal Code, besides various sections of the Prevention of Corruption Act, 1988.
After the arguments from the advocates arguing for SIT and Midhun Reddy, the judge remanded him to judicial custody till August 1. The MP is likely to be shifted to Rajahmundry Central Jail, a SIT official said.
A 28-page remand report submitted by the SIT before the court, which was seen by HT, described Midhun Reddy, as one of the chief architects and principal executors of the entire conspiracy and operational design of the liquor syndicate in Andhra Pradesh.
“He has orchestrated policy-level changes to the excise and liquor procurement mechanisms with the sole aim of favouring specific distilleries and brands in return for massive kickbacks,” the report said.
According to the report, the SIT investigations revealed that though Reddy did not formally hold any post in the excise department or AP state beverages corporation limited (APBCL), he exercised direct and indirect influence over key policy decisions, including change of procurement system of APSBCL from an automated Enterprise Resource Planning (ERP) to a manual, email-driven Order for Supply (OFS) method.
“This structural change enabled discretionary power to override data-driven procurement, thereby allowing select distilleries, linked to the accused, to gain massive market share at the expense of well-established legacy brands,” the report said.
“Reddy played a key role in the appointment of D Satya Prasad (A-3) as special officer in APBCL, who played a key role in brand promotion, suppression of certain suppliers, and arbitrary reallocation of OFS,” the report said.
The SIT investigations revealed how the liquor syndicate members, including Kesireddy Rajasekhar Reddy alias Raj Kesireddy (A-1) who was then IT advisor to the government, his cousin Avinash Reddy (A-7) and Midhun Reddy had gathered at the residence of former Rajya Sabha member V Vijay Sai Reddy on October 13, 2019.
“The syndicate analysed the liquor sales data of the previous three years and came to the conclusion that they could earn around ₹50-60 crore per month in the form of commissions/kickbacks from various distilleries and suppliers. This was corroborated by the statements of the witnesses who deposed before the SIT,” the report said.
The investigation revealed that the accused had hatched a plan to do away with private retail outlets and introduce exclusive government-run retail outlets manned to have absolute control on the indenting and thereby monopolizing the procurement.
“For collecting kickbacks, Midhun Reddy planned to establish a private network by attracting gullible young graduates including several IIT graduates to act as collection agents. He also planned establishment of shell companies for routing of money through multiple hawala channels,” the report said.
The establishment of new distilleries and manufacturing of new brands and to make more money apart from kickbacks since issuance of OFS was under the control of Midhun Reddy, the report said.
