Delhi Chief Minister Rekha Gupta tabled the Comptroller and Auditor General (CAG) report titled ‘Performance Audit on Regulation and Supply of Liquor in Delhi’ in the assembly on Tuesday, February 25. The report is one of the 14 CAG reports about the performance of the previous Aam Aadmi Party (AAP) administration that the Bhartiya Janata Party (BJP) government in the national capital plans to table in the Delhi assembly.
The 208-page report, divided into 8 chapters, highlights the lapses in implementing the now-scrapped Delhi excise policy, which eventually led to a loss of approximately ₹2,002 crores to the Delhi government.
The CAG report, accessed by Mint, says that while the common man bore the cost, Aam Aadmi Party (AAP) leaders received ‘kickbacks’. It also points out the glaring lapses, policy violations, and questionable decisions favouring certain entities while sidelining due process.
“It is amazing to know that the CAG report has not been tabled in the assembly after 2017-18. In this regard, the then LoP, i.e. me and five other opposition leaders, had requested the President, Speaker of the assembly, CM, and Chief Secretary to table the report. It was much needed to obtain the financial condition of the state. Unfortunately, the CAG report was not tabled, and the previous government violated the Constitution,” said Delhi Legislative Assembly Speaker Vijender Gupta after the report was tabled.
The eight chapters in the report, apart from an introduction, are titled Excise Supply Chain Information Management System, Issue of Licenses, Pricing of IMFL and FL, Violation of Quality Norms, EIB and Confiscation, Enforcement, and Excise Policy 2021-22.
The executive summary mentions the issues in the excise policy in A) four years between 2017 and 2021, among the issues that the summary highlights include violations in the award of licenses, lack of transparency in the pricing of Indian-made foreign Liquor (IMFL), inadequate quality control, weak regulatory functioning, poor execution of the enforcement function, and lacunae in end-to-end inventory tracking.
What does the CAG report reveal?
The report also mentions B) issues in the new excise policy (2021-22). It highlights issues such as infirmities in the formation of the excise policy, issues and design in awarding licenses, and issues of implementing the excise policy.
“Despite being mentioned in the conditions of the tender document that any commercial risk shall lie with the licensee, the clarification provided during the pre-bid meeting that there is no provision for force majeure and against the opinion of the excise department to relax the license fees, a waiver of license fees of ₹144 crores was granted to the zonal licenses on the basis of COVID restrictions (December 28, 2021 to January 27, 2022) resulting in loss of revenue to the government,” reads the report.
The Delhi Excise Policy, introduced in November 2021, was pitched as a game-changer for Delhi’s liquor market. However, the policy faced criticism amid allegations of corruption and financial irregularities. Top AAP leaders in the Delhi government, including Arvind Kejriwal and Manish Sisodia, were arrested in the case and eventually released on bail.
Apart from the above three, incorrect collection of security deposits from zonal licensees led to a revenue loss of around ₹27 crore. Therefore, these implementation issues of the new policy led to a revenue loss of approximately ₹2,002 crores, the CAG report says.
The common man bore the cost, while AAP leaders received ‘kickbacks’.
“Excise policy aimed to eradicate the sale of spurious liquor and check bootlegging. However, important measures that were planned in the policy, like setting up liquor testing laboratories, batch testing for rigorous quality assurance, and monitoring and regulation through the creation of a dedicated post, were not ensured,” the document reads.
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