As Delhi gears up for its 2025 Assembly elections, the controversy surrounding the now-scrapped Delhi excise policy has reignited political tensions. A Comptroller and Auditor General (CAG) report released on January 11, 2025, revealed that the lapses in implementing the policy resulted in a massive loss of Rs 2,002 crore to the Delhi government. The report arrives just weeks ahead of the polls scheduled for February 5.

Liquor Policy
Introduced in November 2021, the excise policy aimed to revolutionize Delhi’s liquor market. Instead, it became a source of political and financial controversy, leading to allegations of corruption and favouritism. Senior Aam Aadmi Party (AAP) leaders, including then-Deputy Chief Minister Manish Sisodia, were arrested in connection with the case, with both Sisodia and Chief Minister Arvind Kejriwal eventually securing bail.

The CAG report, titled “Performance Audit on Regulation and Supply of Liquor in Delhi,” highlights critical flaws, including policy violations, ignored recommendations, and decisions favouring specific entities. Anurag Thakur, BJP MP and former Union Minister lambasted the AAP government during a press conference, stating, “This scam has led to a fiscal deficit of Rs 2,002 crore. The AAP promised schools but created liquor shops instead. While they spoke of ‘brooms,’ they only swept transparency under the rug.”

Breakdown of the Rs 2,002 Crore
The CAG report provided a detailed breakdown of how the Delhi government’s treasury suffered:
License Surrenders: Retailers surrendering licenses before policy expiration led to an Rs 890 crore loss due to the lack of re-tendering.
Zonal Licensee Exemptions: The government’s decision to offer exemptions to zonal licensees resulted in Rs 941 crore in lost revenue.
COVID-19 Waivers: Rs 144 crore was waived as license fees due to the pandemic.
Security Deposits: Errors in collecting security deposits cost the treasury Rs 27 crore.
Additional issues flagged include non-transparent pricing of Indian-Made Foreign Liquor (IMFL), weak quality control measures, and irregularities in awarding licenses.

Ignored Recommendations & Arbitrary Decisions
The CAG report also criticized the Delhi government for ignoring expert panel recommendations and taking arbitrary decisions without proper approvals. The policy was implemented without clearance from the Delhi Cabinet or the Lieutenant Governor (L-G), raising serious governance concerns.

Investigations & Arrests
The fallout from the policy has led to investigations by both the Enforcement Directorate (ED) and the Central Bureau of Investigation (CBI). Several senior AAP leaders faced scrutiny for allegedly receiving kickbacks tied to the policy, with arrests.