Delhi Liquor Case Approver's Firm Gave Rs 34 Crore Via Electoral Bonds to BJP

Aurobindo Pharma's director, Sarath Reddy, was arrested in connection with the Delhi liquor policy case in 2022.

Aurobindo Pharma's director Sarath Reddy was arrested in connection with the Delhi Liquor Policy case.

(Photo: The Quint) 

Five days after P Sarath Reddy, the director of Aurobindo Pharma was arrested by the Enforcement Directorate (ED), the company donated electoral bonds worth Rs 5 crore to the BJP. This revelation has emerged after the State Bank of India (SBI) submitted the unique bond number data to the Election Commission of India (ECI) on Thursday.

The Quint had earlier reported that on 10 November 2022, ED arrested Reddy in connection with its money laundering case into alleged irregularities in the Delhi government’s liquor policy. Five days later, on 15 November, Aurobindo Pharma donated electoral bonds worth Rs 5 crore. With the new data out now, it’s confirmed that this Rs 5 crore went to the BJP. Incidentally, this revelation comes on the same day that the ED has placed Delhi CM Arvind Kejriwal under arrest in the same Delhi liquor policy case.

Months after this donation, in May 2023, the Delhi High Court granted bail to Reddy on medical grounds. A month later, in June 2023, the ED moved a plea before the court to pardon Reddy, and for him to be made an ‘approver’ in the case— meaning that he would voluntarily disclose all the irregularities in the policy. The Rouse Avenue court accepted the plea.

Aurobindo Pharma then made another set of donations—worth Rs 25 crore—in November 2023, five months after becoming an approver in the ED case. This Rs 25 crore was also donated by the company to the BJP. This was the biggest set of donations made the company via electoral bonds.

Prior to BJP, Donations Went To TDP, BRS

Aurobindo Pharma bought electoral bonds a total of six times, of which four times, the donation went to the BJP. In April 2021, the Hyderabad-based firm donated Rs 2.5 crore to Telugu Desam Party (TDP). In January 2022, the company donated Rs 3 crore to the BJP. Then in April 2022, Aurobindo Pharma donated Rs 15 crore to the Bharat Rashtra Samithi (BRS). In July 2022, the company donated Rs 1.5 crore to the BJP. The final two donations—of Rs 5 crore and Rs 25 crore both went to the BJP.

In all, Aurobindo Pharma donated a total of Rs 52 crore via electoral bonds, of which Rs 34.5 crore went to the BJP—over 66 per cent.

Aurobindo Pharma's Connection With Delhi Liquor Policy

Aurobindo Pharma is a Hyderabad-based pharmaceutical giant, which was founded back in 1986. The company’s name surfaced in connection with the alleged Delhi liquor policy scam, where members of the Delhi government stand as the primary accused.

The Aam Aadmi Party (AAP)-Delhi government had implemented a liquor policy In November 2021, but scrapped it at the end of September 2022 amid allegations of corruption. According to the ED, Reddy was a part of the "South Group" that had allegedly paid Rs 100 crore to the AAP, which was used to fund its Goa elections. The ED had told the court that Reddy was “one of the kingpins” and a “major beneficiary of the cartelisation” whose cartel group “controlled 30 percent of Delhi's liquor market”. Delhi Deputy Chief Minister Manish Sisodia is one of the primary accused in the case, and has been in jail since February 2023.

Sarath Reddy is the son of P V Ram Prasad Reddy, who had founded the Aurobindo Pharma, and is also the son-in-law of co-founder and managing director K Nityananda Reddy. Aurobindo Pharma is seen as a major player in the generic drugs market with a consolidated turnover of Rs 23,455 crore in 2021-22. Sarath Reddy’s arrest was also of political significance, given his indirect association with the YSR Congress Party. Sarath’s brother is married to YSRCP MP Vijay Sai Reddy’s daughter. Vijay Sai Reddy is seen as a close aide of Andhra Pradesh CM YS Jagan Mohan Reddy.

After Sarath Reddy’s arrest in November 2022, Aurobindo Pharma released a statement saying, "The company has learnt that the arrest of Sarath Chandra is not in any way connected with the operations of Aurobindo Pharma Limited or its subsidiaries." According to Financial Express, after Sarath's arrest, Aurobindo Pharma's shares plunged by 11.69 per cent. However, that didn't stop the company from donating electoral bonds worth Rs 5 crore just five days after Reddy's arrest.

After Reddy was made approver by ED, the agency said that he would voluntarily disclose all the irregularities in making and implementing the liquor policy in Delhi.

Aurobindo Pharma donated a total of Rs 52 crore between April 2021 and November 2023. The biggest installment came in November 2023 (of Rs 25 crore), five months after becoming an approver in the ED case.