Scrapped Delhi Liquor Policy Led to ₹2,002.68 Crore Loss: CAG Report

New Delhi – A report by the Comptroller and Auditor General (CAG), tabled in the Delhi Assembly on Tuesday, has revealed that the scrapped liquor policy, implemented in November 2021 and withdrawn in September 2022, caused a staggering loss of ₹2,002.68 crore to the Delhi government. The findings, which point to multiple wrong decisions and omissions, have reignited political controversy.

The controversial excise policy had already led to the arrest of several Aam Aadmi Party (AAP) leaders, including then Chief Minister Arvind Kejriwal and Deputy Chief Minister Manish Sisodia. The corruption allegations surrounding the policy were also seen as a key factor in AAP’s defeat in the recent Assembly elections, paving the way for the BJP’s return to power in Delhi after 26 years.

Breakdown of Losses

The CAG report divides the losses into four major categories:

• ₹941.53 crore – Loss due to liquor shops not being allowed in non-conforming areas.
• ₹890.15 crore – Loss from failure to issue tenders for 19 zones where licenses were surrendered.
• ₹144 crore – Revenue loss due to waivers given to licensees in the name of COVID-19 relief.
• ₹27 crore – Loss from the incorrect collection of security deposits from zonal licensees.

The report was tabled amid uproar in the Assembly, leading to the suspension of 15 AAP MLAs.

Policy Violations & Alleged Favoritism

The CAG report also flagged several violations, including the Delhi Excise Department’s failure to enforce Rule 35 of the Delhi Excise Rules, 2010, which prohibits multiple liquor licenses for related entities. This, sources claim, benefited certain players in the liquor trade.

One of the most contentious aspects of the policy was the increase in the wholesaler margin from 5% to 12%, with the Enforcement Directorate (ED) alleging that half of this margin was to be collected as kickbacks for AAP leaders. The justification for the margin hike—setting up government-approved laboratories and covering transportation costs—was also questioned, as no such labs were operationalized.

The report further highlighted monopolization within the liquor industry, with just three wholesalers—Indospirit, Mahadev Liquors, and Brindco—accounting for over 70% of liquor sales in Delhi. Additionally, it pointed out revenue loss due to whiskey brands being sold more at private liquor vends than government-run stores.

Political Fallout

The revelations in the CAG report are expected to intensify the political storm surrounding the excise policy, with opposition leaders calling for accountability and further investigations. Meanwhile, the BJP has accused AAP of orchestrating a massive scam, reinforcing its narrative that the liquor policy was designed to benefit select private players at the cost of public revenue.