The Delhi government suffered a loss of Rs 2,002 crore due to the now-scrapped liquor policy between 2021 and 2022, according to a Comptroller and Auditor General report tabled in the Assembly on Tuesday.

The former Aam Aadmi Party government in the capital introduced the liquor policy in November 2021, exiting from the liquor business and handing it over to private vendors in a licence-based system.

This, according to the government, was done to eliminate the liquor mafia, increase government revenue and improve consumer experience.

In July 2022, Delhi Lieutenant Governor VK Saxena recommended a Central Bureau of Investigation probe into the policy after the chief secretary alleged in a report that it provided “financial benefits” to “private liquor barons” as part of a quid pro quo scheme involving Aam Aadmi Party leaders.

The Delhi government withdrew the policy nine days later.

In the ensuing months, central agencies raided the homes and offices of Aam Aadmi Party leaders and summoned them for questioning. Party leaders including former Chief Minister Arvind Kejriwal and his Deputy Chief Minister Manish Sisodia had been arrested in the case.

An Enforcement Directorate chargesheet said that private vendors involved in the “scam” funded the Aam Aadmi Party’s poll campaign in Goa in 2022.

The Comptroller and Auditor General’s report states that the liquor policy “was framed ostensibly to achieve the objectives including to not allow the formation of any monopoly or cartel in the liquor trade, to ensure equitable access of liquor supply to all the wards/area of Delhi, to allow the responsible players in the industry to carry out the trade transparently without resorting to any proxy model and to eradicate the sale of spurious liquor and check bootlegging.”

However, it noted that there were several infirmities in how the policy was formed and deficiencies in how it was implemented, which in turn “led to a loss of revenue of approximately Rs 2,002 crore”.

The report stated that “important measures which were planned in the policy like setting up of liquor testing laboratories, batch testing for rigorous quality assurance, and monitoring and regulation through creation of a dedicated post were not ensured”.

It also stated that recommendations from an expert panel were ignored by the then-Deputy Chief Minister and Excise Minister Manish Sisodia.

The report is one of 14 on the previous Aam Aadmi Party government’s performance that is due to be tabled by the new Bharatiya Janata Party government in the capital.

The Rs 2,002 crore loss comprised sums of Rs 941.53 crore lost to delayed permissions, Rs 890.15 crore lost from not re-tendering surrendered zonal licences before the policy expired in August 2022, Rs 144 crore lost from irregular Covid-related waivers to zonal licensees and Rs 27 crore lost from incorrect collection of security deposits from licensees.

The BJP has accused the previous Aam Aadmi Party government of withholding the reports, The Hindu reported.

Rekha Gupta, Delhi’s new chief minister, had announced on February 20 that the reports would be made public in the first Assembly session under her government.

BJP MLAs, who were in the Opposition at the time, had filed a petition with the Delhi High Court last year seeking directions to the speaker to convene an Assembly session for tabling the reports.

On January 13, the High Court stated that the Comptroller and Auditor General’s reports should have been presented promptly in the Assembly for discussion. The court criticised the state government for “dragging its feet” on the matter but stopped short of directing a special Assembly session for the purpose.

Responding to the report, former Chief Minister Atishi claimed that the Aam Aadmi Party had done the right thing by introducing the now-scrapped excise policy.

“The AAP government always raised concerns about corruption in the old excise policy, which facilitated illegal liquor smuggling,” she said. “The report shows that liquor shop owners engaged in corrupt practices, inflating prices and causing heavy losses to Delhi’s exchequer.”

She alleged that the Aam Aadmi Party’s liquor policy could not be implemented effectively due to interference from the lieutenant governor, the Central Bureau of Investigation and the Enforcement Directorate.

“This led to a situation where no officer was willing to sign or execute the policy, fearing legal action,” said Atishi, now leader of the Opposition in the Delhi Assembly. “As a result, Delhi lost Rs 2,000 crore in expected revenue and Rs 8,900 crore annually.”

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