NEW DELHI: The Supreme Court on Wednesday asked the Enforcement Directorate (ED) to explain why the Aam Aadmi Party (AAP) hadn’t been arraigned as an accused by the federal agency though it insisted that the political party was the main beneficiary of the corruption case registered over the now-scrapped Delhi excise case.

The observation came during a hearing on appeals filed by former deputy chief minister Manish Sisodia seeking bail in separate cases related to the alleged irregularities in the excise policy investigated by the ED and the Central Bureau of Investigation (CBI).

Also Read: ED arrests AAP leader Sanjay Singh in Delhi excise policy case

“We need clarity on this issue as far as the money laundering offence is concerned. He (Sisodia) is named as one of the beneficiaries. Your whole case is that the political party is said to have benefitted from this. But they are not accused. How do you answer that?” a bench of justices Sanjiv Khanna and SVN Bhatti said.

The question came around the time Sisodia’s lawyers, senior advocate Abhishek Manu Singhvi and advocate Vivek Jain, were wrapping up their submissions and stumped both sides as this aspect had not been argued by Sisodia.

“He (Sisodia) has not raised this point. We have put it directly to you. Whatever it is, you answer that tomorrow,” the bench said, turning to additional solicitor general (ASG) SV Raju who appeared for ED. The court will resume hearing the case on Thursday.

Sisodia has been in jail for nearly seven-and-a-half months since his arrest by the CBI in February. He was later also arrested by ED in March.

In his submissions, Singhvi took the court through the entire-decision making process of framing the excise policy to demonstrate that this was not a decision taken by one individual but collectively decided at various levels including excise department officers, a group of ministers, Delhi cabinet and the office of the Lieutenant Governor (LG) of Delhi.

It was purely a policy decision involving ministers, a host of government servants and with LG in supervision of the policy. “It is not an individual decision but an institutional one,” Singhvi said. He showed cabinet notes related to the formulation of the draft policy sent to the LG for his comments. Based on suggestions received from the LG office, a separate cabinet note was prepared incorporating LG’s suggestions that found expression in the final policy approved in November 2021.

The court raised apprehensions on whether cabinet notes could be relied upon by the court in view of a constitution bench decision and asked ASG Raju to ascertain this.

Advocate Vivek Jain who assisted Singhvi pointed out that the documents in question were part of the charge sheet submitted by CBI. He said that the effort is to bring to the court’s knowledge that the transaction alleged against Sisodia was drawn at different levels forming part of a complete chain culminating in the birth of the policy. Since Sisodia handled the excise department, the new policy was released by him.

ED alleged that Sisodia was involved in the generation of proceeds of crime of around ₹100 crore in the form of kickbacks received from the “South lobby” to one of the co-accused Vijay Nair, who is AAP’s communication in-charge.

Singhvi read through the entire evidence and said, “From the presentation of the complaint till the filing of charge sheet, I am not named anywhere. Not one paisa money trail from the South lobby has been found. They (ED) say the accused are orchestrated by me, but nothing is found from my home or office.”

He also objected to the speed with which some of the accused in the case have been changing statements and getting bail after they turn approvers and support the prosecution. “It deserves an inquiry how you (ED) get statements from the arrestees. This is the grossest case I have seen where there is so close proximity between the date of arrest and release. Judges have to read between the lines as everything cannot be in black and white.”

Singhvi said that the new policy completely busted cartelization and this was not liked by the existing liquor manufacturers who wanted to continue with the old regime. The bench told Singhvi that the charge sheet of the ED alleged that the new policy raised the profit margin for liquor retailers and dealers from 5% to 12%. Singhvi explained that the new policy was suggested by an expert committee which fixed 5% as the minimum base with no top cap. This was followed by the decision of the group of ministers (GoM) on March 19, 2021, which capped the profit margin at 12%.

“These are works in progress. There were massive leaks in the old policy due to evasion of excise duty which led to huge profit margins of up to 65%. In the new policy, the excise duty was subsumed in the license fee and since the license fee was hiked substantially up to ₹5 crore, higher profit margin was offered,” Singhvi said.

The court was also told that the revenue projections under the new policy projected an earning of ₹55 crore from just the license fee. In 2019-20, the projected earnings from sales and license fees put together was ₹69.15 crore.

Sisodia approached the top court against two orders by the Delhi high court that denied him bail. On May 30, he was refused bail in the CBI case and on July 3, in the ED case. The senior AAP leader has also sought interim bail in the matter citing his wife’s health condition.