P v Mudhun Reddy @ Peddireddi Venkata Midhun Reddy Vs the State of Andhra Pradesh

P V Midhun Reddy @ Peddireddi Venkata Midhun Reddy, S/o.P.Ramachandra Reddy, Aged about 47 years, Occ: Members of Parliament, Resident of D.No. 1-97, Errathivaripalli Sodum Mandal Chittoor District.

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...Petitioner

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AND

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The State of Andhra Pradesh, Through SHO, CID Police Station, Mangalagiri, Rep. by Public Prosecutor, High Court of Andhra Pradesh at Amaravathi. ...Respondent Petition under Section 482 of BNSS praying that in the circumstances stated in the Memorandum of Grounds of Criminal Petition, the High Court may be pleased to direct the release of the Petitioner on bail in the event of his arrest in connection with Crime No.21 of 2024 of CID Police Station, Mangalagiri, Guntur District.

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lA NO: 1 OF 2025

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Petition under Section 482 of BNSS praying that in the circumstances stated in the Memorandum of Grounds of Criminal Petition the High Court

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may be pleased to grant interim anticipatory bail to petitioner in Crime No.21 of 2024 of CID Police Station, Mangalagiri, Guntur^District.

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Counsel for the Petitioner : SRI KALLA GUNA SEKHAR

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Counsel for the Respondent : Public Prosecutor

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The Court made the following order:

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APHC010135872025

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IN THE HIGH COURT OF ANDHRA PRADESH AT AMARAVATI

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[3369]

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(Special Original Jurisdiction)

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TUESDAY, THE FIFTEENTH DAY OF JULY TWO THOUSAND AND TWENTY FIVE

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PRESENT

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THE HONOURABLE SRI JUSTICE T. MALLIKARJUNA RAO

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CRIMINAL PETITION NO: 2904/2025

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Between:

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IP V MUDHUN REDDY @ PEDDIREDDI VENKATA MIDHUN REDDY, S/0 P.RAMACHANDRA REDDY, AGED ABOUT 47 YEARS, OCCUPATION MEMBERS OF PARLIAMENT, RESIDENT OF D.N0.197, ERRATHIVARIPALLI, SODUM MANDAL, CHITTOOR DISTRICT

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...PETITIONER/ACCUSED

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AND

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1.THE STATE OF ANDHRA PRADESH, Through SHO, C.I.D. Police Station, Managalgiri. Represented by Public Prosecutor,^HighCourtof Andhra Pradesh, at Amaravathi.

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...RESPONDENT/COMPLAINANT

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Petition under Section 437/438/439/482 of Cr.P.C.,^and528 of BNSS praying that in the circumstances stated in the Memorandum^ofGroundsof Criminal Petition, the High Court is pleased to direct the release of the petitioner on bail in the event of his arrest in connection^{withthecrime.No.21} of 2024 of C.I.D. Police Station, Mangalagiri, Guntur^{District,andtopass}

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lA NO: 1 OF 2025

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Petition under Section 482 of Cr.P.C. and 528 of BNSS praying that in the circumstances stated in the Memorandum of Grounds of Criminal Petition, the High Court may be pleased

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Counsel for the Petitioner/accused:

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1.KALLAGUNASEKHAR

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TMR,J Crl.P.No.2904 of 2025

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Counsel for the Respondent/Complainant:

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1. PUBLIC PROSECUTOR

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The court made the following ORDER:

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This Criminal Petition has been filed by the Petitioner/A.4 by invoking the provisions of Section 482 of Bharatiya Nagarik Suraksha Sanhita, 2023 [for short, "BNSS'] Seeking pre-arrest bail in the event of his arrest in connection with Crime No.21 of 2024, involving offences punishable under Sections 420, 409, and 120-B of the Indian Penal Code, 1860 (for short, 'I.P.C.') registered at the C.I.D., Police Station, Andhra Pradesh, Mangalagiri. During the investigation. Sections 7, 7A, 8, 13(1)(b) and 13(2) of the Prevention of Corruption Act, 1988 (for short, ‘P.C.Act’)^{wereaddedvidea} Memo dated 22.04.2025.

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The case of the prosecution, as projected in the report, dated 23.09.2024 and subsequent Memo dated 22.04.2025 as contained in the counter affidavit filed on behalf of the respondent-State,^{whichareasfollows:} i. On 23.09.2024 at 22:00 hrs, a report was received^from Sri Mukesh Kumar Meena, Principal Secretary, Government of Andhra Pradesh (Memo No. Rev-01/CPE/20/2024-VIG-IV, dated 20.09.2024). It highlighted alleged irregularities and corruption in APSBCL from^October2019 to March 2024, referencing Government Memo No. Rev-0l/P&E/Complaint^s/ 2024 (09.09.2024) and a letter from the MD, APSBCL (Lr.No.APSBCL/ OFS/2024-25, dated 18.09.2024) with enclosures.

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ii.Y. Venkateswara Rao Srinivas submitted a representation alleging irregularities in APSBCL from October 2019 to March 2024. It was forwarded to the MD, APSBCL for investigation, resulting in a detailed report as per the second reference,

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iii. After reviewing the records, the Committee found the irregularities, which are as follows:

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(1) Suppression of established popular brands and unfair^{discrimination} in the allocation of OFS (Order for Supply) over time led to the almost complete disappearance of some brands from the market.

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(2) Favourable and preferential allocation of orders^{tocertainnewbrandsin} violation of existing norms, thereby giving them undue^marketshare and competitive advantage.

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(3) The procurement system was shifted to a manual process, giving scope for manipulation in OFS against the previous automated OFS system, compromising the process's integrity.

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iv. The MD, APSBCL, reported that the Committee reviewed^OFSdatafrom 2018 onward, as detailed in the annexures. However,^{themotivebehind} the observed discrimination and procurement irregularities remained unclear. The Committee recommended appointing an external specialised agency for further investigation, which the MD supported. The report has been reviewed, and given the gravity of issues, i.e., suppression of brands, unfair discrimination, preferential allocation,^{andotherviolations} further action is warranted.

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V. Investigation reveals a large-scale liquor scam in Andhra Pradesh (20192024), involving political figures, including the petitioner (a Lok Sabha member), who allegedly facilitated a policy favouring^{selectdistilleries} in exchange for kickbacks, causing over ?3,500 crores in losses. Following the Court's Order dated 03.04.2025 in Crl.P.No.2904/2025, A.1 was arrested on 21.04.2025, and new material, including corroborated evidence, links the petitioner as a key planner. A financial trail also connects one liquor manufacturer to PLR Projects Pvt. Ltd., tied to the petitioner and associates. The petitioner was named^{A.4videMemodated} 22.04.2025 before the III Additional District & Sessions Judge, Vijayawada,

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vi. It is denied that the. petitioner is being targeted for political reasons. On the contrary, evidence indicates he misused his position for personal and allied financial gain, causing public loss. A summary^{ofthe2019-2024}

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TMR,J Crl.P.No.2904 of 2025 investigation, is

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Andhra Pradesh liquor scam, based on the ongoing investigation, provided below:

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a) The petitioner was the primary executor and instrumental in planning and directing the entire operation. He, along with other accused, planned the change in excise policy and also its modalities, to ensure that he and others would receive large kickbacks, a large portion of which was received in cash, gold bullion, eto. Furthermore, he planned the routing/rotation of money from liquor

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suppliers/manufacturers to himself/his family members and associates. An investigation is underway to unravel the multi-layered financial transactions to identify all beneficiaries other than the petitioner. His custodial interrogation is required for this purpose as well.

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b)The syndicate, led by the petitioner and co-accused, manipulated sales, suppressed competitive brands, and controlled indenting

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through direct communication with depot managers. Kickbacks, averaging 20% per liquor case, were collected in cash or gold via complex financial routes involving inflated invoices fictitious transactions, and shell companies. Funds were laundered through bullion traders, promotional spends, and companies with links to the petitioner (e.g., PLR Projects),

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c) Evidence includes statements from 153 witnesses, financial records of over 100 distilleries, and forensic data. Companies such as Adan Distilleries, SPY Agro, Tilaknagar Industries, and Sharvani Alco Brew received substantial payments from APSBCL despite lacking requisite infrastructure or showing suspicious fund flows. Estimated illicit gains exceed ?3,500 crores. The investigation is ongoing to trace layered transactions and identify final beneficiaries.

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d) Investigation has revealed the petitioner's deep and central involvement in the liquor scam, as evident from witness^statements (under Sections 161 & 164 CrPC), documentary and electronic evidence, and financial records. The key findings are:

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The petitioner was a core conspirator from inception to execution, orchestrating policy changes and coordinating^withco accused to secure kickbacks from distilleries/suppliers.

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He induced public servant A.3 (Satya Prasad) with the promise

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of Non-SCS IAS promotion, and ensured his appointment as Special Officer to implement the conspiracy.

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He directly influenced APSBCL officials (A2 & A3), participated in multiple planning meetings, and issued instructions^that led to massive financial loss to the State.

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Kickbacks were routed via entities like SPY Agro,^SanhocLabs, and Dcart Logistics, with ?5 Crores credited to PLR Projects Pvt. Ltd.—a company closely linked to the petitioner's family.

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The petitioner's 2024 election affidavit discloses^a?47.74Crore liability to PLR Projects Pvt. Ltd., confirming financial^ties.Dcart Logistics (from which PLR received ?5 Cr) is directed by^A.9, the PA of A.1.

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The petitioner also holds shares in Shiva Shakthi Dairy^Pvt.Ltd.. In this PLR group entity, his mother and sister are^directors, reinforcing his connection to PLR and the illicit fund^flow.

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The transaction trail indicates the use of front/shell companies for laundering kickbacks, warranting further investigation into potential quid pro quo.

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Post 03.04.2025, new witness statements (LWs.108, 113, 121) further affirm the petitioner's direct role in planning and executing the scam.

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vli. That under the directions of the Hon’ble Supreme Court dated 07.04.2025 in SLP (Cri) No.5218 of 2025, the petitioner^wassummoned and did appear before the C.I.D., on 19.04.2025. However, during^his examination, the petitioner was non-cooperative, gave^{evasiveanswers,} and made misleading statements, thereby impeding the progress of the

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investigation. His conduct is indicative of a deliberate attempt to obstruct and derail the investigative process.

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The case of the Petitioner/A.4, as set out in the petition and elaborated in the reply affidavit, is as follows:

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(a) The petitioner refutes the State’s claim that he is a "mastermind" of the liquor scam, stating it is unsubstantiated and misleading. The petitioner holds no executive or cabinet role, and witness statements are vague and delayed. The repeated use of the term is unsupported by any concrete or new evidence post the 03.04.2025 order. The FIR was registered in September 2024, yet statements under Sections 161 and 164 Cr.P.C., have been recorded nearly seven months later, are vague, and appear to be coerced. Notably, key witness statements (LW-18, 72, 90) do not mention the petitioner, and others are generalised without specific attribution. No credible material has been placed linking the petitioner to the alleged crime. Witness statements cited are vague, obtained belatedly, and allegedly under coercion. He highlights past instances where the High Court intervened to protect witnesses and accused from harassment, including:

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WP.No.8586/2025: Directors of Sharvani Alco Brew alleged coercion and were granted legal safeguards during interrogation.

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WP.No. 10339/2025: A. 1 's parents complained of threats and abuse by investigating officers; the court ordered statements to be recorded at home in the presence of counsel.

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WP.No.9861/2025: Petitioner sought and received similar protection for his interrogation, ordered to be conducted in the presence of his lawyer and under CCTV.

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WP.No.10008/2025: Habeas corpus petition revealed illegal detention of AO’s relatives: Court ordered the detainee to be produced, confirming misconduct.

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In WP.No.11620 of 2025, the mother of Sk. Saif Ahamed sought protection from harassment.

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(b) A political vendetta drives the prosecution. Following^theaction taken against members of the current government, a retaliatory FIR was registered. The petitioner is being targeted selectively, with no genuine prosecutorial intent, only a desire to arrest and malign. The State falsely links the petitioner to a ^5 crore transaction between Dcart Logistics and PLR Projects. Bank records show this was a business advance returnedⁱⁿ October 2021. The Investigating Agency, despite having full knowledge of the remittance, has suppressed this fact. The petitioner^{IsneitheraDirectornor} responsible for PLR Projects' operations, which the State itself acknowledged. The petitioner cannot be held liable for its actions. Holding shares in Shiva Shakthi Dairy Pvt. Ltd., which is not a subsidiary of PLR Projects, also has no bearing on the present crime. Companies associated with the petitioner's family are cooperating with the investigation and submitting requisite documents under BNSS notices. The Petitioner, being a Member of Parliament, had no role in state excise decisions, promotions, or policy making. His alleged connection to the promotion of A.3^{orliquorpolicy} changes is unfounded and irrelevant to his official duties. The alleged irregularities stem from the 2014-2019 period, during which the current regime favoured selected distilleries and manipulated the liquor store licensing system. This led to a monopolistic syndicate controlling 80% of liquor stores, resulting in losses to the state exchequer — a system the petitioner had no role in formulating or implementing, (c) Between 2019 and 2024, a reformed, state-controlled policy aimed to reduce alcohol use, eliminate illicit shops, and ensure transparency via e-payments and QR codes. Shop numbers were cut by 33%, illegal outlets dismantled, and tax-based revenue rose without burdening manufacturers. GAG audits confirmed a significant increase in excise^{revenue.Crime} No. 18/2023 was filed against top officials for 2014-2019 irregularities; Crime No. 21/2024 allegedly mirrors it to dilute prior charges.

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(d) The Petitioner submits that Mr. Satya Prasad’s Section 164 CrPC statement is vague and unreliable. The allegations against him are false and politically motivated. No evidence or Memo linking him to the case has been provided. As an MP, he had no role in excise policy formulation or APSBCL operations, which are Cabinet-approved and implemented by officials. Financial records show increased state revenue from 2019 to 2024, negating claims of loss. Even if statements are accepted, no charges apply as he was neither entrusted with property nor involved in inducement or conspiracy.

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(e) The Petitioner argues that the criminal case stems from a political vendetta and that his earlier apprehension of arrest was dismissed by the state as speculative, which is contradicted by subsequent attempts to arrest him. Despite earlier claims of no incriminating material, the State added him as A.4 post 21.04.2025 and expanded charges under IPC and P.C.Act. However, no fresh evidence justifies this escalation. The petitioner complied fully with the Supreme Court's directions, appeared for interrogation, and answered all questions. Despite this, the State continues its attempt to arrest him.

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I have heard Sri T. Niranjan Reddy, learned senior counsel for the Petitioner/A.4 and Sri Sidharth Luthra, learned senior counsel, representing the Respondent-State assisted by Sri M. Lakshmi Narayana learned Public Prosecutor and Sri G. Neelothpal, learned Assistant Public Prosecutor and perused the written submissions filed in support of their contentions. Both sides reiterated their submissions on par with the contentions presented in the Petition and written submissions. Consequently, the contentions raised by learned counsel need not be reproduced.

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The record reflects that the petitioner filed a pre-arrest bail application. while the prosecution initially submitted that there was no material warranting his arrest. This court, by Order dated 03.04.2025, dismissed the application, observing that the investigation was at a nascent stage and there was no

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imminent apprehension of arrest, as the investigating^{officerhadyettoassess} the sufficiency of evidence to array the petitioner^asanaccused in Crime No.21 of 2024. Aggrieved, the petitioner filed SLP^{(Crl)No.5218/2025before} the Hon’ble Supreme Court, which remitted the matter^{tothiscourtforfresh} consideration.

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The learned senior counsel for the petitioner requested this court to dispose of the application in light of the following^{observationsmadebythe} Hon’ble Supreme Court in its Order dated 13.05.2025^{inSLP(Crl)No.5218of} 2025;

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“72. Section 35 of the Bharatiya Nagrik Suraksha Sanhita, 2023 provides for arrest by a police officer without an^{orderfromaMagistrate} and without a warrant. The Section gives discretion^{tothepoliceofficer} who may, without an order from a Magistrate and even^{withoutawarrant,} arrest any person in the situations enumerated in that^Section. It is open to him in the course of investigation to arrest any person^whohasbeen concerned with any cognisable offence or against whom reasonable complaint has been made or credible information has^{beenreceivedora} reasonable suspicion exists of his having been so concerned.^He Is not expected to act in a mechanical manner and, in all^cases, to arrest the accused as soon as the report is lodged. In appropriate^{cases,aftersome} Investigation, the Investigating Officer may make up^{hismindastowhether} it is necessary to arrest the accused person. At that^{stage,thecourthasno} role to play. 13. Since the power is discretionary, a police officer^{isnotalwaysbound} to arrest an accused even if the allegation against^him is of having committed a cognisable offence. 14. Since an arrest Is in the nature of an encroachment^{onthelibertyof} the subject and does affect the reputation and status^{ofthecitizen,the} power has to be cautiously exercised. It depends inter^{aliauponthenature} of the offence alleged and the type of persons who^{areaccusedofhaving} committed the cognisable offence. Obviously, the power has to be exercised with caution and circumspection."

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XXX. However, this time the High Court may look Into the materials that may be shown to prime facie indicate^{theinvolvementofthe} petitioner, if any, in the alleged offence. The issue^{ofapprehensionof} arrest being genuine or not now pales into insignificance.^TheHighCourt shall now decide the plea of anticipatory ball afresh,^{keepinginmindthe} well-settled principles of grant of anticipatory bail,^{ofcourse,lookinginto}

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TMR,J Crl.P.No.2904 of2025 the materials which the State may show to the High Court. It is for the High Court to consider now whether there is any prima facie case made out against the petitioner. Whether the action sought to be taken by the State IS on account of a political vendetta? All other grounds germane to the consideration of the grant of anticipatory bail

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The learned senior counsel for the petitioner submits that the Constitution Bench decisions in Gurbaksh Singh Sibbia V. State of Punjab' (paras 14, 15, 19, 26, 28, 31, and 33) and Sushiia Aggarwal V. State (NOT Of Delhlf (paras 45-57, 63, 66, 71, 73, and 92) affirm the primacy of personal liberty and lay down clear principles governing the grant of anticipatory bail. It IS argued that the petitioner's case falls squarely within these parameters. Further, it is contended that Section 482 of the BNSS mirrors the unamended Section 438 of the Code of Criminal Procedure, 1973 (for short, 'Cr.P.C.'). The deliberate omission of factors such as the nature of the offence or the accused’s antecedents indicates according to counsel, the legislature’s intent to confer broad, unfettered discretion on this Hon’ble Court under Section 482 BNSS.

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The learned senior counsel for the petitioner further relied on the judgment of fhe Hon'ble Supreme Court in Siddharam Satlingappa Mhetre V. State of Maharashtra^ particularly paragraphs 91 and 109, wherein the court held that although the power to grant anticipatory bail may be Characterised as "extraordinary," this does not warrant the inference that such power should be exercised only in exceptional circumstances. The court emphasised that the power is discretionary and must be exercised based on the facts and circumstances of each individual case. Consequently, it is not necessary for the petitioner to establish a "special case” in order to invoke this relief.

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^ (1980) 2 see 565 (2020) 5 see 1 ^ (2011) 1 see 694

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The learned senior counsel for the Respondent-State places reliance on the decisions reported in Serious Fraud Investigation Office V. Aditya Sarda"^, wherein the Hon’ble Apex Court held that:

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“18. Now, so far as anticipatory bail is concerned, this court has consistently emphasised that anticipatory bail should not be granted as a matter of routine, particularly in serious economic offences, involving largescale fraud, public money or complex financial crimes.

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Given the above settled legal position, it is no more res integra that economic offences constitute a class apart, as they have deep-rooted conspiracies involving huge loss of public funds. Therefore,^suchoffences need to be viewed seriously. They are considered as grave and serious offences affecting the economy of the country as a^{wholeandthereby} posing serious threats to the financial health of the country. ”

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In light of the observations made by the Hon’ble Supreme^CourtinSLP (CrI.) No.5218 of 2025, and considering the precedents^{citedabove,thiscourt} duly considers the submissions advanced by both parties.

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At this stage, it is relevant to note that the learned^{seniorcounselforthe} Respondent-State submits that this court has already^{rejectedanticipatorybail} to co-accused K. Dhananjaya Reddy (A.31) and P. Krishna^MohanReddy (A.32) in CRLP Nos.4837 and 4838 of 2025, respectively,^{byacommonorder} dated 07.05.2025. The rejection was based on the gravity^{oftheallegations} and the necessity of custodial interrogation to confront^{thepetitionerswiththe} material gathered. The Hon'ble Supreme Court, in SLP^{(CrI.)Nos.7532and} 7533 of 2025, affirmed this court's view, holding that the High Court had not erred in declining anticipatory bail and had exercised^{itsdiscretionjudiciously.} The learned senior counsel for the Respondent-State contends that the petitioner cannot seek parity with unrelated matters^{ordifferentlysituated} accused, and the Hon’ble Supreme Court has already^{declinedanticipatory} bail to similarly placed high-ranking officials in^{thesameFIR(CrimeNo.21of} 2024).

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2025 see Online Se 764

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The learned senior counsel for the petitioner contends that the State's reliance on orders passed in the cases of A.31 to A.33 for examining the petitioner's case is misplaced. It is submitted that the Hon'ble Apex Court has passed a specific order in the petitioner's SLP, making the findings in the petitioner's case directly relevant, while the decisions in the third parties' cases are not binding on the petitioner. At this juncture, it is pertinent to refer to the observations made by the Hon’ble Apex Court in SLP (CrI.) No.5218 of 2025 dated 13.05.2025, directing this court to look into the materials that may be shown to prima facie indicate the involvement of the petitioner, if any"... and that the High Court shall now decide the plea of anticipatory bail afresh keeping in mind the well-settled principles of grant of anticipatory bail of course, looking into the materials which the State may show to the High Court.

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The case of the prosecution is that following the 2019 elections, the government introduced a liquor policy vide G.O.Ms.No.357 (16.08.2019), establishing 3,500 Government Retail Outlets (GROs) under APSBCL. The policy, purportedly towards prohibition, however, the prosecution contends that instead it facilitated State control over the liquor trade. A new excise policy replaced the transparent, automated liquor procurement system with a discretionary, email-based OFS mechanism under APSBC. This shift enabled select distilleries, often shell companies or non-operational entities, to secure supply orders in exchange for kickbacks. The manual override of the system allowed the accused complete control of the liquor trade, eliminating transparency. 17. It is the case of the Prosecution that APSBCL's payment procedure followed a discount policy for timely supplier payments. Still, MD Vasudeva Reddy continued applying an outdated policy after the 2021 revised GO, causing a financial loss to the government. Between June 2022 and March 2024, f200 crores was overpaid to suppliers, benefiting distilleries like Spy Agro Industries and Leela Distilleries, as part of the ongoing kickback scheme.

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, the scheme in question favoured select 18. According to the prosecution well-established brands lipuor brands such as Adan and Leela, while sidelining like Pernod Ricard and McDowell. As a result, several distlllenes erther diverted their products to other states. down operations or accounts of 19. The prosecution contends that an analysis of the f.nanciai and suppliers involved in the liquor business reveals that various distilleries rates, based on the these entities agreed to pay^kickbacksat compelled^prescribed to arrange regular cash category of liquor. Additionally, they were accounts of real estate payments, which were -nne.ed — companies, shell companies, and other ent . P subsequently transferred to — 3 thorough that the investigation is still in examination of these transactions that they were responsible for 20. The allegations against the petitioner are of favoured brands and the promotion the disconfinuation of popular liquor syndicate illicitly amassed from 2019 to 2024, the brands. It is alleged that of the liquor distribution approximafely ?3,200 crores through manipulation for popular brands, applied market in Andhra Pradesh. They withheld orders brand allocation known liquor brands.

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The prosecution has relied upon sale transactions presented in a tabular ' contained therein, prima facie, support the prosecutions and the details

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21 ■ ' form, and the details case.

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Brand McDowell’s Brandy _ Imperial Blue Whisky Kingfisher Beer Ri idweiser Beer Brand	Quantity in^OIS^IS ?? 73.086 ~~^n7T955 1,02,47,566 _ 2^52/195 Market share 2018:19^	Quantity in 202^j4— 5 7 11,82,388 0 Market share 2023^4

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McDowell’	s Bra	ndy 23.41%	2.15%
Kingfisher	Beer	29.5%	3.21%
Budweiser	Beer	11.43%	1.25%
S	.No.	Name of the Brand	Quantity Intended
	1.	Ocean Blue Whiskey	2,76,706
	2.	Daru House Whiskey	68,83,420
	3.	Supreme Blend Whiskey	77,35,400
	4.	Brilliant Blend Whiskey	37,30,800
	5.	9 Sea Horse Whiskey	46,07,733
	6.	Andhra Gold Whiskey	20,61,711
	7.	Good Friend Whiskey	27,72,050
	8.	HD Whiskey	22,02,555

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The learned senior counsel for the Respondent-State submits that the proceedings before the Competition Commission of India (CCI) relate to the period from 2019 to 2021. However, the allegations against the accused extend from 2019 to 2024. This court finds considerabie force in the submission of the iearned senior counsel for the Respondent-State that the petitioner cannot place reliance on the CCI's Order dated 19.09.2022 as its scope IS confined to the provisions of the Competition Act, 2002 and the Order does not address or adjudicate upon any criminal offences that may arise from the practices under scrutiny before the CCI. Given the detailed sales data of various brands presented in tabular form, the prosecution's allegations appear to have a prima facie basis and cannot be rejected as unfounded.

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Learned senior counsel for the Respondent-State submits that the petitioner has misled this Hon'ble Court by concealing multiple antecedents, specifically, six FIRs apart from the two disclosed in the petition. Such non disclosure of material facts, particularly prior criminal history, is a valid ground for denial of anticipatory bail. In support, reliance is placed on Munnesh V. State ofU.P., wherein the Hon’ble Apex Court held that;

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Xxx since the petitioner has suppressed material facts with regard to his involvement In criminal cases, he is not entitled to the discretionary relief of bail.”

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In response, learned senior counsel for the petitioner^{submitsthatthe} cases listed in the counter at SI.Nos.I and II resulted in acquittals, SI.No.Ill was quashed, and SI.No.lV was compromised before the Lok^Adalat, rendering them irrelevant to the present matter. Regarding SI.No.V^{(CrimeNo.12of} 2017), it is contended that the FIR was politically^motivated, arising from YSRCP supporters raising slogans against the then Chief^Minister.As for SI.No.VI (Para 3), the Respondent-State itself has^recorded it as a ‘mistake of fact'. Having considered these submissions, this court is not inclined to consider the Respondent-State’s request in this regard.

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Learned senior counsel for the petitioner submits that^{theprosecution's} case is based on the allegation that PLR Projects received^{?5CroresfromD-} Cart Logistics, purportedly linked to the liquor transactions. However, the material placed shows that the amount received by PLR in 2019 was transferred to D-Cart only on 30.10.2021; the prosecution^{reliessolelyonthe} statement of LW.113, who is a hearsay witness claiming^{tohavelearnedthat} the ?5 Crores were returned to D-Cart for cash; beyond^{thisuncorroborated} hearsay, there is no material linking the transaction^{totheallegedliquorscam;} moreover, it is an admitted fact that the petitioner^{holdsnopositioneitheras} director or shareholder in PLR Projects.

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The learned senior counsel for the petitioner argues^{thatthestatements} of LWs.18, 72, and 90 do not mention the petitioner's^name or role. The statements of LWs.16, 19, 25, 26, 31, 41,42, 47, 70,^{80,104,106,108,and} 113 are vague and contain general allegations that^cannot, in any way, be considered prima facie evidence against the petitioner.^{Thelearnedsenior} counsel further contends that the anticipatory bail^{orderdated03.04.2025} indicates the investigation officer found the material^{insufficienttonamethe} petitioner as an accused at that time; the petitioner^{wasonlyaddedasA.4by} a memo dated 22.04.2025. Apart from recording the statements^ofLW.113on 05.04.2025 and L.W.121 on 18.04.2025, no other material^{hasbeencollected.}

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^^

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This court views that the prosecution’s contention^{thatthematerialcollected} as of 03.04.2025 was insufficient to name the petitioner^{asanaccuseddoes} not preclude consideration of this material, especially if subsequent investigation has collected some incriminating material against the petitioner. Moreover, the learned senior counsel for the petitioner^contends that the statements of LWs.113 and 121 are hearsay and they^{cannotbeconsidered.} 27. The learned senior counsel for the petitioner placed reliance on the decision reported in Kalyan Kumar Gogoi V. Ashutosh Agnihotri and another^, wherein the Hon’ble Apex Court held that;

¶141

The term "hearsay" is used concerning what is done^{orwrittenaswell} as to what is spoken and in its legal sense, It denotes^{thatkindof evidence} which does not derive its value solely from the credit given to the witness himself, but which rests also, in part, on the veracity and competence of some other person. The word "hearsay" Is used in various senses. Sometimes it means whatever a person Is heard to say. Sometimes it means whatever a person declares on Information given by someone else, and sometimes it is treated as nearly synonymous with irrelevant. The sayings and doings of the third person are, as a rule. Irrelevant, so that no proof of them can be admitted. Every act done or spoken^{whichisrelevant} on any ground must be proved by someone who saw it with his own eyes and heard it with his own ears”.

¶142

To consider the submission, this court has perused^theSection 161 Cr.P.C. statement of LW.113. The statement suggests^{thatLW.113claimed} personal knowledge regarding the transactions between^{D-CartandMidhun} Company in connection with the alleged liquor dealings. While part of his statement refers to what he came to know about Midhun’s intent to return funds through banking channels, as such, it cannot be wholly classified as the statement of LW.113 as hearsay.

¶143

Learned senior counsel for the Respondent-State submits^thatbetween 2019 and 2024, Andhra Pradesh State Beverages Corporation Limited (APSBCL) made payments totaling ?1,569.52 Crore to SPY Agro Industries

¶144

® (2011) 2 see 532

¶145

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¶147

Ltd., from which f60 Crore was circulated among SPY Distilleries, M/s. Sanhoc Labs, and M/s. D-Cart Logistics. The prosecution claims that ?5 Crores was transferred from M/s D-Cart Logistics (A. 16) and its Director, Tukekula Eeswar Kiran Kumar Reddy (A.9), to PLR Projects Pvt. Ltd. on 31.12.2019 and 13.02.2020, supported by material placed on record. The petitioner, however, contends that the amount received in 2019 was repaid to D-Cart Logistics on 30.10.2021. This court finds prima facie merit in the prosecution's argument that such repayment, nearly two years later, does not exonerate the petitioner from alleged involvement.

¶148

The prosecution, on the other hand, has submitted material indicating that the petitioner's family members hold substantial interests in PLR Projects Pvt. Ltd. and have previously served as directors.^{Further,thePetitioner's} Election Affidavit dated 24.04.2024 discloses a liability^{of?47.74Croresowed} to PLR Projects Pvt. Ltd. Additionally, records show^{thatthepetitionerholds} shares in Shiva Shakthi Dairy Pvt. Ltd., whose only^{directorsarehismother} and sister. It is the prosecution’s case that Shiva Shakthi^{DairyPvt.,Ltd.,} is one of the subsidiary business companies of the PLR^Group. Thus, the prosecution argues that following the investigation after 03.04.2025, new evidence has emerged showing a money trail from the^{accusedcompany} (A. 16) through suspicious transactions to PLR Projects Pvt. Ltd and the investigation also revealed that significant sums paid^{toPLRProjectsPvt.Ltd.} and other companies were kickbacks. Relying on these details, the prosecution asserts it has established a direct link^{betweenthepetitionerand} PLR Projects Pvt. Ltd., showing that the proceeds of^{crimeweretransferredto} the petitioner’s family. In the absence of any contrary^material, it cannot be said that reliance on witness statements to link the transaction with the alleged liquor scam is unjustified.

¶149

The prosecution further relies on the statements of^{LWs.104,108,113,} and 121 to show the involvement of petitioner in the^{commissionofoffence.}

¶150

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¶152

The Hon'ble Apex Court in P.Krishna Mohan Reddy I/. The State Pradesh\ observed in paragraphs 43 to 45, as under:

¶153

of Andhra

¶154

the Crpctr^' Section 161 of y Council m Pakata Narayana Swami v. Emperor reported in (1939) an^adm^ C. 47 explained that a confession is'«li'oha statementconstituteadmittingthe offencethe offencewhereasor concTrr “ ^ —adng fact ten a conclusively incriminating fact is not of itself a confession Where such a inadmissible oo A /^ ■ « . would be completely decisions o.idis co^rtl^r, Z^e^tZul aTn only for the very limited purpose pro vided in the Proviso as held in Mahabir Mandal (supra).

¶155

44 We are conscious of a handful of decisions of this court wherein it hTTT'‘ “"der Section 161 of the CrPC ought to Onbne SC 2411, observed that "statements under Section 161 of Cr P C may not he admissihle in evidence, but are relevant in Tsldna the prime facte case against an accused in an application for grant of T in TT'eTT TeZtemant r^^^^^^^^^^ ~ Of the Offence and also exarrTTZTjfTsTTTTTT acZTTZfT TT of getting the attendance of the an accusedS'"®'" nTt observations cannot be singled out and construed devoid of their context While it is permissible The courts to examine the statements recorded under Section 161 of the Cr.P.C. to ascertain whether a prima facie case has been made out against the accused and the nature or gravity of the allegations,^the same applies only insofar as such police statements are of witnesses and notaccused persons.

¶156

Both Indresh Kumar (supra) and Salim Khan (supra) have held that in deciding the question of grant of bail, it is the statements of

¶157

MANU/SC/0737/2025

¶158

19 TMR,J Crl.P.No.2904 of 2025

¶159

witnesses under Section 161 of the Cr.P.C. that have to be looked into. Nowhere has this court held that even the police statements of the accused person under Section 161 of the Cr.P.C. must^{alsobelookedinto} at the stage of grant of anticipatory or regular bail."

¶160

In light of the observations made by the Hon'ble Apex Court, this court has gone through the witness statements relied upon by the prosecution, excluding the statements of the co-accused. Upon careful perusal, this Court, prima facie, finds merit in the prosecution's submission^{thatthestatements} provided by several witnesses have underscored the petitioner’s prima facie involvement in the criminal conspiracy associated with the Excise Policy. The prosecution contends that these changes were orchestrated^{withtheintentto} secure substantial kickbacks.

¶161

Learned senior counsel for the petitioner submits that the petitioner is a two-time elected Member of Parliament representing the Rajampeta Constituency. His father, a sitting MLA and former Minister, is also a prominent leader in the YSRCP. It is contended that^{boththepetitionerand} his father hold significant political stature, and that the present case has been foisted upon them due to political vendetta, as similar allegations were made against the current Chief Minister and others during^the previous^regime.This court views that mere political differences between the petitioner and the current government do not justify granting anticipatory bail when the prosecution places prima facie material to show the petitioner's involvement in the alleged offence.

¶162

Learned senior counsel for the petitioner further placed^{relianceonthe} decision in P.Krishna Mohan Reddy (supra), wherein^theHon’ble Supreme Court held that;

¶163

To some extent, the petitioners could be said to^{havemadeoutaprima} facie case of political bias or mala iTdes, but that^{byitselfIsnotsufficientto} grant anticipatory bail, overlooking the other prima facie materials on record. Political vendetta or bias, if any, is one of the relevant considerations while considering the plea of anticipatory^bail. The courts

¶164

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Should keep one thing in mind, more particularly, while considering the plea of anticipatory bail, that when two groups of rival political parties are at war, which may ultimately lead to litigations, more particularly, criminal prosecutions, there is bound to be some element of political bias or vendetta involved in the same. However, political vendetta by itself is not sufficient for the grant of anticipatory bail. The courts should not just look into the aspect of political vendetta and ignore the other materials on record, constituting a prima facie case . alleged by the State. It is only when the court is convinced more than prima facie that the allegations are frivolous and baseless, that the court may bring into the element of political vendetta into consideration for the purpose of considering the plea of anticipatory bail. The frivolity in the entire case that the court may look into should be attributed to political bias or vendetta.

¶167

In this regard, a reference can be made to the decision reported in Ramveer Upadhyay and Ors. V. State of U.P. and Ors/, wherein the Hon’ble Supreme Court held that; 30. The fact that the complaint may have been initiated by reason of political vendetta is not in Itself a ground for quashing the criminal proceedings, as observed by Bhagwati, C.J. in Sheonandan Paswan v State of Bihar and Ors. MANU/SC/0206/1986. It is a well-established proposition of law that a criminal prosecution, if otherwise Justified and based upon adequate evidence, does not become vitiated on account of rnala fides or political vendetta of the first Informant or complainant Though the view of Bhagwati, C.J. In Sheonandan Paswan (supra) was the minority view, there was no difference of opinion about this finding. To quote Krishna Iyer, J., in State of Punjab v. Gurdial Singh MANU/SC/0433/1979, "if the , of power Is for the fulfilment of a legitimate object, the actuation or catalysation by malice is not Illegal."

¶168

The learned senior counsel for the petitioner submits that in the previous regime, Crime No. 18 of 2023 was registered against the current Chief Minister, the then Excise Minister, and an IAS officer. The allegations in the present case mirror those in Crime No. 18 of 2023. This court granted bail to the then Chief Minister, noting his role as Leader of the Opposition, his lack of control over the relevant department, absence of flight risk, and Z+ security cover. Which ensured that anticipatory bail would not hinder the investigation.

¶169

^ MANU/SC/0524/2022

¶170

21 TMR,J Crl.P.No.2904 of 2025

¶171

X

¶172

However, the bail order in the earlier case does not^{indicateanyreceiptof} amounts by the petitioner therein.

¶173

The learned senior counsel for the petitioner argues^{that,asaMember} involvement in the of Parliament, the petitioner had no control over or formulation or execution of the State’s Excise Policy.^{Therefore,thereisno} fiduciary or legal entrustment, nor any dishonest misappropriati^onofpublic property attributable to him. He further submits that^{suchentrustmentor} defined under Section 405 IPC, is essential for an misappropriation, as offence under Section 409 IPC. While the petitioner's^{contentionhasmerit,the} court is not in a position to reach a definitive conclusion^{atthisstage,asthe} investigation is ongoing. Additionally, the record shows that during the investigation. Sections 7, 7A, 8, 13(1)(b), and 13(2)^{ofthePrevention} of 22.04.2025 vide a memo before the Corruption Act, 1988 were added on Special Judge for Trial of SPE and ACB cases-cum-lll^{AdditionalDistrictand} Sessions Judge, Vijayawada. In contrast, the prosecution in^{thepresentcase} suspects that the amounts received by PLR Projects^{Pvt.Ltd.arelinkedtothe} and no material is available to show that the said^transaction is liquor scam unrelated to the allegations made by the prosecution. Therefore, the observations made in the bail order related to Crime^{No.18of2023donot} apply to the present case.

¶174

The Hon’ble Apex Court in a decision reported in^{P.ChidambaramV.} Directorate of Enforcement^, wherein it is held that;

¶175

“83. Grant of anticipatory bail at the stage of investigation^mayfrustrate the investigating agency in interrogating the accused^{andincollectingthe} useful information and also the materials which might have been concealed. Success in such interrogation would elude if the accused knows that he is protected by the Order of the Court.^{Grantofanticipatory} bail, particularly in economic offences would definitely^{hampertheeffective} investigation. Having regard to the materials said^{tohavebeencollectedby} the respondent Enforcement Directorate and considering^{thestageofthe}

¶176

(2019) 9 see 24

¶177

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investigation, we are of the view that it is not a fit case to grant anticipatory bail."

¶180

39. The Hon’ble Apex Court in a decision reported in State Rep. by the CBI V. Anil Sharma^. Wherein it is observed that:

¶181

We find force in the submission of the CBI that custodial Interrogation IS qualitatively more elicitation-oriented than questioning a suspect who is well ensconced with a favourable order under Section 438 of the Code. In a case like this effective interrogation of a suspected person is of tremendous advantage in disinterring many useful informations and also materials which would have been concealed. Success in such interrogation would elude if the suspected person knows that he is well protected and insulated by a pre-arrest bail order during the time he is interrogated. Very often interrogation in such a condition would reduce to a mere ritual. The argument that the custodial interrogation is fraught with the danger of the person being subjected to third-degree methods need not be countenanced, for, such an argument can be advanced by all accused ini.r all criminal cases. The court has to presume that responsible police officers would conduct themselves in a responsible manner and that those entrusted with the task of disinterring offences would not conduct themselves as offenders. ’’

¶182

In Ashok Kumar V. State of Union Territory Chandigarh^^, the Hon’ble Apex Court held that;

¶183

There Is no gainsaying that custodial interrogation is one of the effective modes of investigating the alleged crime. It is equally valid that just because custodial interrogation is not required, that by itself may also not be a ground to release an accused on anticipatory bail if the offences are severe. However, a mere assertion on the part of the State while opposing the plea for anticipatory bail that custodial interrogation is required would not be sufficient. The State would have to show or indicate more than prima facie why the custodial interrogation of the accused is required for Investigation.

¶184

This court views that the investigating officer deserves a free hand to take the investigation to its logical conclusion in a case containing severe allegations. Granting anticipatory bail to the petitioner could hinder the ongoing investigation. The established legal principle is that anticipatory bail is

¶185

® (1997) 7 see 187 2024 see Online Se 274

¶186

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¶188

not granted as a matter of routine; it should only^{beprovidedwhenthecourtis} convinced that exceptional circumstances warrant such an extraordinary remedy. The necessity for custodial interrogation of the petitioner is paramount in this case to facilitate a thorough investigation into the I accusations.

¶189

The Hon’ble Supreme Court, after referring to Satlingappa^Mhetre’s

¶190

case and other judgments, observing that anticipatory bail^canbegranted only in exceptional circumstances, in Jai Prakash Singh^{V.StateofBihar} and Another^\ held as under:

¶191

Parameters for the grant of anticipatory bail in^{aseriousoffenceare} required to be satisfied, and further, while granting^suchrelief, the court must record the reasons therefor. Anticipatory bail^{canbegrantedonlyin} exceptional circumstances where the court is prime^{facieoftheviewthat} the applicant has falsely been implicated in the crime and would not misuse his liberty. (See, D.K. Ganesh Babu v. P.T. Manokaran^[(2007)4 see 434], State of Maharashtra v. Mohd. Sajid Husain^Mohd. S. Husain [(2008) 1 see 213] and Union of India v. Padam Narain^{Aggarwal[(2008)} 13 see 305])

¶192

¶193

In CBI V. Vijay Sai Reddy^^, the Hon’ble Supreme Court^heldthat;

¶194

While granting bail, the court has to keep in mind the nature of accusations, the nature of evidence in support thereof,^{theseverityofthe} punishment which conviction will entail, the character^ofthe accused, circumstances which are peculiar to the accused, reasonable^{possibilityof} securing the presence of the accused at the trial,^{reasonableapprehension} of the witnesses being tampered with, the larger interests of the public/state and other similar considerations. It has^{alsotobekeptinmind} that for the purpose of granting bail, the legislature^{hasusedthewords} “reasonable grounds for believing” instead of “the^{evidence"whichmeans} the court dealing with the grant of bail can only satisfy^{itselfastowhether} there is a genuine case against the accused and that^{theprosecutionwill} be able to produce prime facie evidence in support^ofthecharge. It is not expected, at this stage, to have the evidence establishing^{theguiltofthe} accused beyond a reasonable doubt.

¶195

(2012) 4 see 379 (2013) 7 see 452 ’

¶196

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¶198

It cannot lose sight of serious allegations levelled by the prosecution and the evidence collected during the investigation and produced before this court, which prime facie reveal the petitioner’s role in the offence in question. Given these circumstances, custodial interrogation is deemed essential to confront the petitioner with the gathered evidence and to unravel a broader conspiracy implicating the accused in the implementation of the Excise Policy. 45. Having considered the submissions made on behalf of both sides and after considering the gravity of the offence, circumstances of the case, particularly taking note of the accusation that ?3,500 crores were said to be collected towards kickbacks for the liquor syndicate and also considering the settled principle of law that power of grant of bail under Section 438 Cr.P.C., is to be sparingly exercised in extraordinary circumstances and thus, no such circumstances being having been made out in this case, this court does not find it a proper case for granting the relief of anticipatory bail to the petitioner.

¶199

Taking into account the overall facts and circumstances, this court concludes that the petitioner is not entitled to leniency in the grant of anticipatory bail. Consequently, the petition, lacking merit, is dismissed. 47. Nothing stated above shall be construed as a final expression of opinion on the merits of the case, and the observations made in the present case are only for adjudicating the present bail application.

¶200

Miscellaneous applications, pending if any, shall stand closed.

¶201

Sd/- SHAIK MOHD. RAFI ASSISTANT REGISTRAR

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