AAP faces existential crisis as liquor scam clouds its anti-corruption image

It’s fight or perish for Kejriwal’s party as it navigates legal battles, governance clashes, and accusations of betrayal in its national ambitions.

Delhi Chief Minister Arvind Kejriwal at an election rally in Jind on January 28. Amid all the raging controversies, the AAP leader appears battle-ready for 2024. | Photo Credit: ANI

In 2014, just 49 days after taking charge of the Delhi government, Aam Aadmi Party (AAP) national convener Arvind Kejriwal resigned as Chief Minister. He blamed it on the stiff resistance from the Congress and the Bharatiya Janata Party to his anti-corruption efforts. During those tumultuous days, he crafted the image of a rebel for himself who, despite being Chief Minister, acted more like the activist-leader he was of Anna Hazare’s India Against Corruption movement.

About 10 years later, the AAP, which has since become a national party and is in power in two States, is at a crossroads. There is widespread speculation that the AAP will be made an accused in the Delhi excise policy case that Central agencies are investigating. Senior AAP leaders Manish Sisodia, former Deputy Chief Minister, and Sanjay Singh, re-elected to the Rajya Sabha, are in judicial custody. Former Delhi Health Minister Satyendra Jain and former AAP communications in-charge Vijay Nair, who is said to be the main fundraiser for the party, are currently out on medical bail. The sword of arrest hangs over Chief Minister Kejriwal too. His arrest became a possibility after Manish Sisodia’s on February 26 last year.

In January this year, Kejriwal was summoned by the Enforcement Directorate (ED) for the fourth time in a case that the CBI registered in connection with alleged irregularities in the liquor policy case. Describing the notices as “illegal”, he told the media recently that the notices in the past had been quashed by the court. “An investigation has been done in this case for two years but they did not recover anything,” he said. The case was registered on August 17, 2022, on a complaint by Lieutenant Governor V.K. Saxena on July 20, 2022. Kejriwal also asked why he was being targeted two months before the Lok Sabha election.

In a sign that the AAP is not giving up despite what the party calls a “political vendetta”, it renominated Sanjay Singh for the Rajya Sabha after his term ended on January 27. Singh is currently lodged in Tihar jail. The AAP has nominated Delhi Commission for Women chief Swati Maliwal as its Rajya Sabha candidate, replacing Sushil Gupta who is proactively engaged in grassroots politics in Haryana, where the Assembly election is scheduled to be held later this year.

Core of the controversy

The AAP government’s liquor policy of 2021-22, which led to the privatisation of liquor trade through public auctioning, is at the core of the controversy. According to the summary of the cases filed by the CBI and the ED, the alleged scam caused a loss of Rs.2,873 crore to the Delhi government. A private company allegedly paid Rs.30 lakh in bribes to members of the AAP government to obtain a wholesale liquor licence. The company reportedly raised Rs. 1,333 crore in sales in a matter of 13 months. It allegedly made a profit of Rs.192.8 crore in just eight months, and is said to have given Rs.100 crore to AAP leaders as kickbacks. According to the CBI, the scam involves a group of businessmen who conspired in Hyderabad in June 2021 to make a fast buck through the Delhi government’s liquor policy.

Kejriwal claimed that the CBI and the ED did not have any evidence against his party members and criticised the “inaction” in a liquor scam in BJP-ruled Haryana and in the incident of liquor deaths in Gujarat. He also alleged that in Gujarat, which enforces prohibition, the annual illegal liquor business was valued at about Rs.15,000 crore. AAP sympathisers and supporters argue that a section of the media has pronounced AAP leaders guilty without bothering to find the truth behind the charges.

Addressing a press conference in Delhi last year, Kejriwal claimed that “over 1,000 raids” had failed to find evidence of corruption against his party leaders. “The agencies have searched the houses and lockers of our leaders. They claimed that we spent money on the Goa Assembly election and questioned our vendors. But they found nothing. We had made all payments through cheques,” he said, questioning the existence of a money trail.

Kejriwal’s arrest, if it happens, is sure to put pressure on the party’s second-rung leaders, who do not appear to have the stature to keep the flock together. Kejriwal has spoken of an alleged conspiracy to bring about the disintegration of his party. Interestingly, despite the growing criticism by opposition parties about the BJP using Central agencies to target them, the arrest of AAP leaders does not appear to have generated much public sympathy. In the recent Assembly elections in Rajasthan, Chhattisgarh, and Madhya Pradesh, the AAP failed to win a single seat and got fewer votes than NOTA (none of the above).

Governance tussle with Centre

The AAP governments in both Delhi and Punjab are in a governance tussle with the Centre. In Delhi, there is a tussle with the Lieutenant Governor over the legislative and executive powers of the elected government and the Municipal Corporation of Delhi vis-a-vis administrative services. Things got worse last year with the Centre bringing in the Government of National Capital Territory of Delhi (Amendment) Act to maintain its control on administrative services after the Supreme Court’s five-judge Constitution Bench headed by Chief Justice D.Y. Chandrachud ruled unanimously in favour of the AAP government.

In Punjab, the State government shares an uneasy relationship with Governor Banwarilal Purohit, who threatened to impose President’s rule in August last year. The Supreme Court has had to intervene at times, and it has ruled in the AAP’s favour on several occasions.

AAP supporters at the party’s January 28 rally in Jind. | Photo Credit: PTI

Given the acrimony between the AAP and the BJP-led Central government, political watchers have raised doubts about the alleged liquor scam. It emerged when Chief Secretary Naresh Kumar approached Lieutenant Governor V.K. Saxena alleging procedural lapses in the policy formulation. The Supreme Court noted that except for a statement made by businessman Dinesh Arora, an accused-turned-approver in the case, there was no evidence on record against Sisodia. The court asked the ED to establish a money trail linking Sisodia with the liquor lobby, but it did not grant Sisodia bail.

Political vendetta?

The arrests are seen against the backdrop of opposition legislators who have been accused in corruption cases escaping action after they crossed over to the BJP. “Corruption cases against some politicians are not new. It is difficult to allege political vendetta in all cases, but there may be some truth in some cases,” said former Supreme Court judge Justice Madan Lokur in a recent interview to PTI. “The troubling aspect of all this is that after investigations start and the suspect changes loyalties, the investigation is dropped. That gives rise to a grave suspicion of political vendetta,” he noted.

“If Manish Sisodia and Sanjay Singh join the BJP, they will be set free in 24 hours,” Kejriwal said at a karyakarta sammelan in Delhi in November 2023. He alleged that the BJP planned to jail West Bengal Chief Minister Mamata Banerjee, (now former) Bihar Deputy Chief Minister Tejashwi Yadav, and (now former) Jharkhand Chief Minister Hemant Soren to win elections in those States.

Highlights

• There is widespread speculation that the AAP will be accused in the Delhi excise policy case, which Central agencies are currently investigating.
• The sword of arrest hangs over Delhi Chief Minister and AAP leader Arvind Kejriwal, as well as many of his senior party colleagues, including former Deputy Chief Minister Manish Sisodia.
• Kejriwal has been putting up a spirited fight, but it is doubtful whether AAP’s second-rung leaders will be able to keep the flock together in the event of his arrest.

If the track record of the AAP is any indication, the ragtag party has always benefited from challenges and controversies. But this time the dominant view is that the present crisis could prove damaging for the party. Many blame Kejriwal for his “autocratic” approach that triggered scores of bitter high-profile departures from the party, including that of founding members such as senior lawyer Prashant Bhushan.

While the AAP has an excuse in New Delhi owing to the constant power tussle with the Centre, the party is yet to produce an alternative model of governance in Punjab. Kejriwal has been a friend, philosopher, and guide to Chief Minister Bhagwant Mann, who is still seen as a political novice and the most unconventional Chief Minister Punjab has had.

Prof. Ashutosh Kumar, who heads the political science department in Panjab University, told Frontline: “In 2022, the mandate for AAP was basically a vote against traditional parties like Congress and the Shiromani Akali Dal.” But, the professor noted, the AAP has so far failed to make any difference in the State’s politics. The party MLAs, most of them first-time legislators, are acting like leaders of any other party. “There is a growing feeling among the people of Punjab that the State’s resources are being used by AAP for its election expenditures in other States and for Kejriwal’s publicity.” For instance, opposition parties in Punjab have repeatedly accused Kejriwal of using government aircraft for campaigning in election-bound States.

The AAP, which was formed with a pledge to fight corruption, survived on crowdfunding in its initial years and a vast network of volunteers within the country and abroad. Its election symbol of a broom and slogans promising to clean up Indian politics resonated with all those who were disillusioned with the traditional parties. But Kejriwal’s former colleagues and AAP founding members have publicly stated that the AAP has become just like any other political party. In fact, Kumar Vishwas, once a close Kejriwal confidante, recently described the latter as a “self-consumed pygmy” and a “vulture always hunting for a stinking carcass” to exploit public sentiments.

Not easy to put down

Yet, the AAP has continued expanding its base over the years. In the 2020 Delhi Assembly election, the BJP had to be satisfied with just eight seats while the AAP won 62 of the total 70 seats seats. The BJP won all seven Lok Sabha seats of the National Capital Territory in 2019, but in December 2022 the AAP wrested the Delhi civic body from the BJP, bagging 134 of 250 wards.

Manindra Nath Thakur, associate professor at JNU’s Centre for Political Studies, said it was proving difficult for the BJP to counter the AAP politically, unlike its battle against the ideologically driven Congress.

In 2016, the CBI arrested Kejriwal’s Principal Secretary, Rajender Kumar, after a controversial raid of the Delhi Secretariat in connection with a corruption case. “Since then, the Central government has made several attempts to discredit the AAP. But it has failed to prove anything,” Thakur said.

Amid all the raging controversies, Kejriwal looks battle-ready for 2024. In his recent rallies across States, he attacked not just the BJP but also the Congress, even though the AAP is part of the INDIA bloc. Describing his party as the country’s “fastest growing” and “most targeted” party, Kejriwal projects himself as the main challenger to Narendra Modi. He is trying to convert his possible arrest into a public sympathy project. On November 17, he told party workers to “go to every household, ask whether I should continue as Chief Minister from jail. Inform them about the BJP’s conspiracies. Ensure they do not get a single seat here [in Delhi]. This will be a campaign for the Lok Sabha election.” On January 1, the party declared that it reached out to more than 23 lakh households and that the majority of the people said he should not resign as Chief Minister even if he was arrested under a “BJP conspiracy”.

In his rallies, Kejriwal says his party colleagues were arrested because of their pro-poor politics. Before his arrest in October, Sanjay Singh alleged that he was framed for speaking about Modi, the businessman Gautam Adani, and their alleged corruption. Singh had filed complaints with the ED against Adani, alleging his involvement in corruption. “No action was taken against him. But the ED has raided my house all of a sudden. Though they have found nothing, they are arresting me,” Singh said at the time.

On January 25, a Delhi court granted bail to Singh’s close aide Sarvesh Mishra, noting that he was not arrested during investigation and he cooperated all through the probe. In December last year, the Supreme Court granted bail to Benoy Babu, regional manager of liquor manufacturer Pernod Ricard India, observing that there were contradictions between the cases being prosecuted separately by the CBI and the ED. Political analysts believe that public sympathy and support for the AAP ahead of the Lok Sabha election depends partly on the Supreme Court’s observations on the merit of the cases. Said Professor Thakur:“If the AAP comes out of this alleged scam unscathed, it [the party] will expand like wildfire.”