Behind the arrest of Manish Sisodia, the Deputy Chief Minister of Delhi, by the CBI yesterday is his alleged link with a liquor lobby the probe agencies have described as ‘South Group‘. What incriminates Sisodia, according to the agencies, are a device held from the excise department office and Sisodia’s secretary’s testimony. Below are the accusations made by probe agencies against Sisodia which he and his party have vociferously contested, terming the whole probe politically motivated.The allegation
Sisodia allegedly tweaked the excise policy according to the wishes of the South Group in exchange for upfront payment of Rs 100 crore. The money was allegedly given to one Vijay Nair, the communication incharge of the Aam Aadmi Party (AAP), at a South Delhi hotel by representatives of the South Group. The policy, which was later scrapped, was designed to provide undue benefits to the liquor lobby the South Group, the probe agencies have alleged.

How it all began
In mid-March last year, the South Group met Nair and used the business centre of the hotel they were staying in to print and photocopy documents, according to a TOI report based on sources. On March 18, Sisodia handed over a document to his secretary, which included the draft of the recommendations of the Group of Ministers on the excise policy. This document had the same number of pages as the pages photocopied by the South Group in the hotel using the hotel’s photocopier. The same number of pages indicate, according to the probe agencies, that the document printed at the hotel by South Group was later handed by Sisodia to his secretary. The document, supposedly the draft of the GoM’s recommendations, had changed the profit for wholesalers from 5% to 12% besides providing for higher turnover eligibility. Probe agencies allege that the changes were suggested by the South Group.

The first chargesheet in the case was filed by the CBI on November 25 last year in which it alleged that the excise policy was framed to promote cartelisation, monopoly and 12% profit in exchange for a payment of Rs 100 crore made to Nair via Dinesh Arora who was close to Sisodia.How the agencies got to know about it
Sources revealed that the computer seized from Sisodia’s office and the judicial statement of his secretary allegedly implicated Sisodia, says the TOI report. While examining a digital device seized during the August 19 search in the excise department, the CBI traced one of the excise policy draft documents to a different system that wasn’t part of the departmental network. The questioning of an excise official led to its identification as Sisodia’s office computer. The agency subsequently seized that computer from the deputy CM’s office on January 14.

The CBI retrieved some of the records with the help of its forensic team, sources claimed. The forensic examination apparently revealed that the file originated externally and was received via WhatsApp.

The statement of Sisodia’s secretary
When summoned by the CBI, Sisodia’s secretary, a 1996 batch DANICS official, stated that the ‘12% profit margin clause’ originated on the draft of the GoM copy that the CBI found had originated externally. The CBI recorded Sisodia’s statement before a magistrate under Section 164 CrPC to make the secretary a prosecution witness, claimed the source according to the TOI report.GoM versus the expert committee
According to the CBI, an expert committee was constituted to make suggestions for the new excise policy. “This committee didn’t recommend the zonal licence system at the retail level nor privatisation of the wholesale model, which was not to the liking of Sisodia. So, the mechanism of GoM was adopted to change the recommendation of the expert committee, says the TOI report, citing sources.

What is the South Group?
According to the ED, prominent members of the South Group are Magunta Srinivasulu Reddy, a YSR Congress MP from Ongole constituency in Andhra Pradesh; his son Magunta Raghava Reddy; Sarath Reddy, a non-executive director,of Aurobindo Pharma; and K. Kavitha, the daughter of Telangana Chief Minister K. Chandrasekhar Rao.

Two weeks ago, the ED arrested Magunta Raghava Reddy after prolonged questioning. Raghava’s name had cropped up in the initial inquiry into the scam several months before his arrest. However, his father had denied his involvement. The Magunta family has been in the liquor business for several decades now. They have been the South India distributors for the UB Group, which is based in Karnataka.

Early this month, the CBI arrested a Hyderabad-based chartered accountant, Butchibabu Gorantla, for his alleged role in the formulation and implementation of the Delhi Excise Policy. Butchi Babu was formerly the chartered accountant of K. Kavitha. The CBI has accused Butchi Babu of causing wrongful gain to Hyderabad-based wholesale and retail licensees and their beneficial owners.