A chargesheet filed by Andhra Pradesh police in connection with the alleged ₹3,500 crore liquor scam has implicated former Chief Minister YS Jagan Mohan Reddy as a recipient of kickbacks. The 305-page document, submitted in a local court, alleges that Reddy received an average of ₹50-60 crore per month. However, the chargesheet stops short of naming Jagan as an accused in the case. The court is yet to take cognizance of the chargesheet.
The chargesheet identifies Kesireddy Rajasekhar Reddy as the "mastermind and co-conspirator" behind the scam. He is accused of manipulating excise policies and replacing the automated order for supply (OFS) system with a manual process. It's alleged that Rajasekhar Reddy created shell distilleries and funneled kickbacks to Jagan through Balaji Govindappa, another accused in the case. The collected amounts were allegedly handed over to Kesireddy Rajasekhar Reddy, who then passed the money to Vijay Sai Reddy, Mithun Reddy, and Balaji, who would transfer it to former Chief Minister Y S Jagan Mohan Reddy.
The Special Investigation Team (SIT) has arrested YSR Congress Party (YSRCP) Lok Sabha member PV Midhun Reddy in connection with the case. His arrest followed hours of questioning. The Enforcement Directorate (ED) had earlier registered a money laundering case under the Prevention of Money Laundering Act (PMLA) to investigate alleged irregularities in liquor sales in Andhra Pradesh.
According to the SIT, the liquor policy during Jagan's term between 2019 and 2024 was allegedly designed to favor a few local liquor brands by replacing popular brands with lesser-known ones in exchange for bribes, amounting to ₹3,200 crore. The TDP Minister Kollu Ravindra alleged a ₹99,413 crore liquor scam under YSRCP, accusing them of manual order manipulation, cash-only sales, and pushing substandard liquor. He questioned the emergence of little-known liquor brands, Aadhan, Leela, NV, V9, Sona, and Munak, which he said had no presence in the state before 2018.
The chargesheet also refers to a meeting held in 2019 at Hotel Park Hyatt in Hyderabad, allegedly convened by Sajjala Sridhar Reddy, where distillery owners were allegedly instructed to cooperate with the manual OFS system. Owners were allegedly intimidated with threats of order cancellations if they did not comply with kickback demands, which initially began at 12% of the base price and later increased to 20%.
The Crime Investigation Department (CID) initially conducted an investigation following a complaint by an official of the Excise Department. Later, the TDP-led NDA government constituted SIT, headed by NTR District Commissioner of Police SV Rajashekhar Babu to probe the case. The SIT reportedly found large-scale irregularities and fund misappropriation in the liquor policy implemented during 2019-24. Investigators reportedly uncovered a kickback network involving nearly ₹3,500 crore siphoned off over five years.
YSRCP leaders have condemned Midhun Reddy's arrest, alleging it is a case of "political vendetta" by Chief Minister N Chandrababu Naidu. The YSRCP has argued that the TDP is weaponizing investigative agencies to divert attention. The TDP, however, has dismissed allegations of political vendetta, claiming there is enough evidence to prove Midhun's involvement and that the money acquired through illegal means was used to fund the YSRCP's 2024 election campaign.
