ED Uncovers Massive 732 Crore Liquor Scam in Andhra Pradesh
The Enforcement Directorate (ED) has made startling revelations in the Andhra Pradesh liquor case, alleging that a company with no distillery, manufacturing infrastructure, or machinery of its own conducted business worth a staggering 732 crore in less than three years. According to the ED's provisional attachment order, this was achieved by leasing other units, securing large supply orders, and routing funds back to a liquor syndicate.
Shell Company Operated as Criminal Enterprise
The ED described Adan Distilleries (ADPL) as a well-planned criminal shell and asserted that its operations were sustained through political backing. The agency identified ADPL as a central special purpose vehicle allegedly created to exploit the state's liquor trade for the benefit of a cartel. Although it appeared on paper to be a commercial liquor business, the probe agency confirmed it neither owned nor operated a distillery and had no production machinery of its own.
Between May 2020 and December 2022, ADPL is alleged to have generated business worth approximately 732 crore. Instead of producing liquor itself, it allegedly tied up with and leased established distilleries, including Vishaka Distilleries, PMK Distilleries, and SPY Agro Industries, to manufacture its flagship brand, Supreme Blend Whisky. The ED further alleged that the syndicate used its control over Andhra Pradesh State Beverages Corporation to secure disproportionately high orders for supply for ADPL from the outset, while genuine and popular brands were suppressed.
Political Backing and Funding Trail Exposed
Investigators alleged that ADPL was floated at the behest of the cartel's principal kingpin Kessireddy Rajasekhara Reddy, also known as Raj Reddy, and former MP Vijaya Sai Reddy. The agency detailed that the company received a cumulative infusion of 60 crore between December 2019 and September 2020. This money was traced from the personal accounts of Penaka Sarath Chandra Reddy, the then director of Aurobindo Pharma, and his brother Penaka Rohit Reddy.
It was routed through the ICICI Bank account of ADPL director Kasichayanula Srinivas in the form of unsecured loans. While Srinivas and Muppidi Anirudh Reddy were shown as directors, the investigation alleged that they acted on the instructions of syndicate leaders. The ED also claimed that ADPL functioned as a conduit for moving illicit wealth back to the cartel and ruling party functionaries.
Kickbacks and Money Laundering Mechanisms
The ED estimated that the company paid about 135 crore in kickbacks to retain its privileged market position. According to the agency, these funds were generated by making inflated payments to vendors, such as M/s Prime Services, for goods that were never supplied, with the money later taken back in cash.
Proceeds from ADPL's operations were allegedly layered through multiple channels. Substantial sums were transferred to gold merchants, including Mohanlal Jewellers and Rao Saheb Boorugu Mahadev Jewellers, to convert accounted money into physical gold coins and bullion. Funds were also routed through non-operational shell entities based in Mumbai, such as Olwick Multiventures and Nysna Multiventures, to mask the trail before the money reached the cartel.
Additionally, nearly 39.8 crore was diverted into real estate, including commercial spaces in the Phoenix Group and projects like Wilderness Ranch. The ED's findings highlight a complex web of financial deception and alleged corruption in the state's liquor industry.
