Enforcement Directorate (ED) in Hyderabad has attached movable and immovable properties worth Rs 441.63 crore in connection with the alleged Andhra Pradesh liquor scam under the provisions of the Prevention of Money Laundering Act, 2002. According to the agency, its investigation has so far uncovered a money trail of Rs 1,048.45 crore in kickbacks allegedly paid by distilleries in the form of cash, gold, and other benefits.
ED sources said that the attached assets belong to Kessireddy Rajasekhara Reddy, his family members, and related entities; Booneti Chanakya and his associated entities; relatives and entities linked to Donthireddy Vasudeva Reddy; as well as several other individuals and companies allegedly involved in the case. The attached properties include bank balances, fixed deposits, land parcels, and other immovable assets.
The ED initiated its investigation based on an FIR registered by the Andhra Pradesh Crime Investigation Department under Sections 120-B, 409, and 420 of the Indian Penal Code, which alleged a loss of around Rs 4,000 crore to the state exchequer.
According to the ED, prior to 2019, the liquor trade in Andhra Pradesh was regulated through an automated software system that digitally tracked procurement, supply, and sales of liquor, creating a verifiable electronic audit trail. However, after the 2019 Assembly elections, the newly formed state government brought retail liquor outlets under government control through the Andhra Pradesh State Beverages Corporation Limited (APSBCL), operating Government Retail Outlets (GROs).
Investigators alleged that, as part of a criminal conspiracy, the automated procurement system was deliberately disabled and replaced with a manual system. This change allegedly granted APSBCL officials discretionary powers to issue Orders for Supply (OFS).
Under the manual OFS regime, established liquor brands were allegedly sidelined or removed from the market, while certain “favoured” brands received preferential allocations in exchange for kickbacks. The ED also alleged that the syndicate promoted “similar-sounding brands” with artificially inflated base prices, enabling distilleries producing these brands to generate surplus margins used to pay illegal commissions.
According to investigators, distilleries were allegedly required to pay kickbacks ranging from 15 percent to 20 percent of the basic price per liquor case to secure OFS approvals. Manufacturers who refused to comply reportedly faced coercive measures, including rejection of supply orders and withholding of legitimate payments.
The agency said communications related to the alleged demand and collection of kickbacks were conducted through encrypted Voice-over-Internet-Protocol (VOIP) calls and messaging applications such as Signal to conceal the identities of key operatives. Individuals, including Muppidi Avinash Reddy (also known as Sumeeth) and Mohammed Saif, were named among those allegedly facilitating such communications.
The ED alleged that Kessireddy Rajasekhara Reddy, along with members of a liquor syndicate, orchestrated a large-scale scam involving the procurement and distribution of liquor in the state. Investigators said the alleged manipulation of APSBCL’s procurement system caused wrongful loss to the state exchequer, while proceeds of crime were distributed among members of the syndicate.
According to the agency, Rajasekhara Reddy, in collusion with Booneti Chanakya, Muppidi Avinash Reddy, Tukekula Eswar Kiran Kumar Reddy, Paila Dileep, and Saif Ahmad, allegedly collected kickbacks totalling about Rs 3,500 crore.
The ED also found that the accused allegedly established or acquired control over several distilleries, which were used as special-purpose vehicles to generate proceeds of crime. Companies, including Adan Distillery Pvt. Ltd., Leela Distilleries Pvt. Ltd., and U.V. Distilleries, were allegedly operated under the effective control of the syndicate and received disproportionately large business volumes.
Another alleged source of illicit revenue involved the manipulation of liquor transportation contracts awarded by APSBCL. Investigators said a centralised transportation tender was granted to Sigma Supply Chain Solutions Pvt. Ltd. at rates significantly higher than earlier depot-wise transportation costs.
Although the contract was officially awarded to the company, members of the liquor syndicate, including T. Eswar Kiran Kumar Reddy and Saif Ahmad, allegedly exercised operational control. A portion of the contract payments was allegedly diverted to entities such as TEKKR, Arroyo, and Ezyload to launder the proceeds of crime.
Investigators further alleged that several distilleries engaged vendors and fictitious entities for the supposed supply of raw materials and packaging items. These vendors allegedly issued inflated or fake invoices for goods that were never supplied, enabling the conversion of banking funds into unaccounted cash.
The ED said the proceeds of crime were also invested in real estate and personal assets through entities such as Eshanvi Infra Projects Pvt. Ltd., ED Entertainment, Uni Corporate Solutions Pvt. Ltd., and Tag Developers, which were allegedly used to acquire land parcels and undertake residential development projects.
“To conceal the origin of funds, the syndicate used a network of shell and front companies, including Olwick, Kripati, Nysna Multiventures, Arroyo, Ezyload, and DCart to layer transactions and disguise the illicit origin of the money,” said an ED official.
According to investigators, the manipulation of procurement and supply systems enabled the syndicate to generate illegal revenues of around Rs 100 crore per month. The ED said cash kickbacks were collected and stored at multiple locations in Hyderabad before being distributed through designated handlers.
The agency added that a significant portion of the proceeds of crime was used to acquire immovable properties and personal assets for syndicate members and their associates, while a substantial amount remains concealed or dissipated.
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