Supreme Court Denies Anticipatory Bail To AP Liquor Scam Case Accused
The Supreme Court has declined to grant anticipatory bail to P. Krishna Mohan Reddy and K. Dhananjaya Reddy in a case involving alleged misappropriation within the Andhra Pradesh State Beverages Corporation Limited (APSBCL).
The Court held that political vendetta or bias alone is not sufficient grounds for granting anticipatory bail if there are other prima facie materials on record. The Court noted that the Andhra Pradesh High Court had denied anticipatory bail to the Petitioners, finding that more than a prima facie case had been made out against them.
A Bench of Justice JB Pardiwala and Justice R Mahadevan held, “Custodial interrogation is qualitatively more elicitation oriented than questioning a suspect who is well ensconced with a favourable order under Section 438. In corruption cases concerning influential persons, effective interrogation of the suspect is of tremendous advantage in disinterring many useful information and also materials which are likely to be concealed. .”
Senior Advocates Vikas Singh, S Niranjan Reddy, S. Nagamuthu and Siddhartha Dave appeared for the Petitioners, while Senior Advocates Mukul Rohatgi, Siddharth Aggarwal and Sidharth Luthra represented the Respondents.
Brief Facts
The Prosecution alleged the suppression of established popular brands, unfair discrimination in OFS allocation, and preferential allocation to certain new brands in violation of existing norms, leading to their near disappearance from the market and giving new brands undue competitive advantage. It was further alleged that the procurement system was shifted to a manual process from a previous automated system, allowing for manipulation. The prosecution claimed the distilleries involved used methods like transferring funds to gold traders, procuring GST invoices, and remitting cash after deductions.
Investigation had revealed suspicious transactions amounting to approximately Rs. 300-400 crores involving entities such as Leela Agro, S.P.Y. Agro, Tilak Nagar Industries Limited, Arham Bullion, and non-existent entities. The specific allegations against the Petitioners were their responsibility for discontinuing popular brands and promoting favoured ones, and collecting approximately Rs. 3200 Crores in kickbacks for a liquor syndicate.
Court’s Reasoning
The Supreme Court noted that the Andhra Pradesh High Court had denied anticipatory bail to the Petitioners, finding that more than a prima facie case had been made out against them.
“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 condition would reduce to a mere ritual. The High Court remained alive and very rightly to the apprehension of the investigating agency that the petitioners would influence the witnesses, considering particularly the high position they all held at one point of time,” the Court remarked.
“Anticipatory bail to accused in cases of the present nature would greatly harm the investigation and would impede the prospects of unearthing of the ramifications involved in the conspiracy. Public interest also would suffer as a consequence,” the Bench held.
The Court reiterated its stance in Sumitha Pradeep v. Arun Kumar C.K. (2022) that the mere fact that custodial interrogation may not be required is not sufficient grounds for granting anticipatory bail; courts must consider the entire case, including the nature of the offence and the punishment provided
“It is needless to say that for the purpose of custodial interrogation, the investigating agency has to make out a prima facie case at the time when remand is prayed for. Whether any case for police remand is made out or not, it is for the Court concerned to look into,” the Bench clarified.
“The courts 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,” the Court further stated.
Consequently, the Court held, “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 as 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.”
Accordingly, the Supreme Court denied anticipatory bail to the Petitioners.
Cause Title: P Krishna Mohan Reddy v. The State Of Andhra Pradesh (Neutral Citation: 2025 INSC 725)
Appearance:
Petitioners: Senior Advocates Vikas Singh, S Niranjan Reddy, S. Nagamuthu and Siddhartha Dave; AOR Mahfooz Ahsan Nazki; Advocates Akhila Palem Rami Reddy, Sahil Raveen, Palak Arora, Meeran Maqbool and Vivek Rajan D.b.
Respondents: Senior Advocates Mukul Rohatgi, Siddharth Aggarwal and Sidharth Luthra; AOR Guntur Pramod Kumar; Advocates Prerna Singh, Udai Dedhiya, Dhruv Yadav, Rajni Gupta, Suhail Ahmed and Vishwajeet Singh
