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The Comptroller and Auditor General (CAG) of India has reported that the Delhi government suffered a financial loss of over ₹2,000 crore due to its 2021-22 excise policy. The report, presented in the Delhi Assembly on February 25, highlights weak policy implementation and violations in issuing liquor licenses.
Key Findings of the CAG Report
- The policy led to a revenue loss of ₹941.53 crore as liquor stores were opened in restricted areas without proper permissions.
- The government lost ₹890.15 crore in license fees after several liquor vendors surrendered their licenses, and the excise department failed to re-tender them.
- An additional ₹144 crore was lost due to waivers granted to liquor vendors during COVID-19 restrictions.
- A further ₹27 crore loss occurred due to errors in collecting security deposits from licensees.
Policy Violations and Political Controversy
The report accuses former Deputy Chief Minister and Excise Minister Manish Sisodia of ignoring expert recommendations while finalizing the excise policy. It states that the Delhi government's decisions, including allowing private companies to manage wholesale liquor operations, were taken without Cabinet or Lieutenant Governor’s approval.
In July 2022, Delhi's Lt. Governor VK Saxena ordered a CBI probe into the matter, leading to the arrest of AAP leaders Arvind Kejriwal, Manish Sisodia, and Sanjay Singh. The investigation into alleged corruption and financial mismanagement in the excise policy is still ongoing.
How Did the Loss Occur?
The Master Plan Delhi-2021 does not permit liquor stores in certain municipal areas. However, the Excise Policy 2021-22 mandated at least two liquor shops in each ward. The excise department issued tenders without approval, resulting in licenses being granted in restricted zones. Later, the Delhi Development Authority (DDA) prohibited these liquor stores, leading to legal disputes and revenue loss.
Moreover, a group of ministers, including Manish Sisodia, made major changes to the policy, increasing the number of liquor stores an individual could own from 2 to 54 and introducing a one-time bidding system instead of a lottery. These changes allegedly benefited private entities at the cost of government revenue.
Conclusion
The CAG report concludes that Delhi’s excise policy failure cost taxpayers ₹2,002.68 crore due to poor planning, unauthorized decisions, and mismanagement. The political fallout from this report has intensified the battle between AAP and BJP, with further investigations expected.
