The Delhi Government’s Finance Department officials had advised Deputy Chief Minister Manish Sisodia to take opinion of the Lieutenant Governor on the Excise Department’s proposal but he did not.
The document showed that that despite the Finance Department from the level of dealing and to the Secretary (Finance) underlining specifically that the proposed changes/amendments in the Excise Policy 2021-22 were prima facie wrong and required approval of the Lt Governor, Sisodia blocked the note to this effect and returned the file to the Finance Secretary.
The document showed that after the amendments in the GNCTD Act 1991 which comes into force on April 27, 2021 and duly followed by the officials of Excise and Finance Departments in May 2021.
“Subsequently also, after obtaining the approval of the Council of Ministers on 23.06.2021, the officials of the Finance Department from the level of dealing and till Secretary (Finance) proposed vide notings dated 24.06.2021 to place the proposal before the then Lt Governor (which shows about their admittance of the fact that subsequent to 27.04.2021, opinion of Lt Governor is must before taking any executive action), however, the same was held by the Dy Chief Minister vide his note dated 24.06.2021 (CD No. 015645891), and the file was returned to the Secretary (Finance),” the document said.
After June 28, 2021, pursuant to amendments in the GNCTD Act,1991 vide GNCTD Amendment Act 2021, it become mandatory to obtain opinion of Lt Governor before taking any executive action on all such matters as specified in the order dated April 28, 2021.
Accordingly, the opinion of Lt Governor was obtained by the officers of the Excise and Finance Department as seen from the notings of the concerned files even on excise policy 2021-22 as well as terms and conditions of the licenses ( the proposed excise policy 2021-22) was discussed by the then Lt Governor with the Chief Minister and the Deputy Chief Minister as per note dated May 19, 2021.
“It is observed that modifications were carried out in the proposed Excise Policy as well as Terms and Conditions of the Licences (like requirement of minimum turnover for wholesale licence was reduced to `150 cr per annum from `250 cr per annum, revision in minimum carpet area of Super Premium Vends L7 SP-1 delinking retailers from wholesalers and manufactures, net worth criteria for applying for retail zones, etc.).
“Pursuant to changes suggested by the then Lt Governor and approval of the Council of Ministers was obtained on 21.05.2021. Thereafter the same was apprised to the then Lt Governor as per Note dated 24.05.2021 of O/o Lt Governor,” the document said.
According to the enquiry report, as far as grant of licenses to shell companies or benami transactions are concerned, it is observed that clause 2.3 of the tender document prohibited the manufacturers or wholesalers to participate in the bidding for Zonal (L72) licence and also that the retail license holder should not have any manufacturing facilities/ distilleries/ breweries/ wineries anywhere in the country or abroad either directly or through any sister concerns related entities.
For this purpose, sister concerns/ related entities were defined as the entities which have common proprietor or partners or directors, and majority ownership (51% or more) of the proprietorship or partnership or company should not lie with the same person in all the entities.
The entities should not have a holding-subsidiary relationship or should not be subsidiaries of the same holding company as defined in the Companies Act, 2013.
In this regard, it is observed from the data of net-worth placed by the officials of Excise Department at page 441/c in file for Excise Policy 2022-23 that Net-worth of Magunta Agro Farms Pvt Ltd. is mentioned as `13.8 crore for Zone No. 4 and as `13.85 crore for Zone No. 23, despite the fact that licence for both the zones was given pursuant to the same tender notice issued on 28.06.2021, which is not possible as single entity cannot have different net-worth on same cut-off date.
“This prima-facie shows that the officials of the Excise Department failed to examine the net-worth of the bidders properly at the time of examination of the bids.”