ED alleges former CM’s son Chaitanya Baghel laundered Rs 16.70 cr in liquor scam, Bhupesh Baghel slams ED, announces economic blockade

RAIPUR:

In a stunning escalation of the ongoing liquor scam probe in Chhattisgarh, the Enforcement Directorate (ED) has alleged in its remand report that Chaitanya Baghel, son of former Chief Minister Bhupesh Baghel, laundered Rs 16.70 crore in the proceeds of crime through two shell companies and under-invoiced real estate ventures. The illicit funds were part of a broader proceeds-of-crime pool generated by a powerful liquor syndicate that allegedly rigged the state’s excise system between 2019 and 2022. The agency claims Chaitanya played a “central and active” role in routing illegal cash through dubious transactions, including funnelling ₹5 crore from M/s Saheli Jewellers into a real estate project “Vitthal Green” developed under M/s Baghel Developers.

While official records showed a project cost of Rs 7.14 crore, ED investigators believe the actual expenditure was Rs 13–15 crore, with a significant portion paid in unaccounted cash. These funds, the agency claims, were part of a massive proceeds-of-crime pool worth over Rs 3100 crore, generated by a deeply entrenched liquor syndicate that systematically manipulated the state’s excise department between 2019 and 2022.

The ED arrested Chaitanya on Friday under the Prevention of Money Laundering Act (PMLA) and secured five-day custodial remand from a special PMLA court in Raipur. His arrest came amid fresh raids at his residence in Bhilai on the morning of his 38th birthday. ED produced a detailed remand application in a special court of Special Judge (PMLA) in Raipur on Friday, and the court granted his custodial remand to ED till July 22.

The remand copy was released late in the evening. Amid sharp criticism from the opposition Congress against BJP govt and the federal agency, Chief minister Vishnu Deo Sai said, “ED doesn’t act randomly against anyone and it knows what it’s doing.” “A key witness connected to the project Pappu Bansal confirmed the under-invoicing and said that only Rs 2.62 crore was recorded in payments to the contractor, while an additional Rs 4.2 crore was allegedly paid in cash, money that ED says originated from the liquor scam,” ED further revealed that on a single day—October 19, 2020—liquor businessman Trilok Singh Dhillon paid Rs 5 crore for 19 flats in the same project, using names of his employees.

This too has been flagged as part of the laundering chain.

The Liquor Syndicate’s Modus Operandi

The liquor scam, currently being called one of Chhattisgarh’s largest corruption scandals, was formally uncovered after the BJP returned to power in the 2023 Assembly elections. An FIR was lodged by the Economic Offences Wing (EOW) and the Anti-Corruption Bureau (ACB) on January 17, 2024, naming 70 individuals and entities including top bureaucrats, liquor distributors, and political figures. The ED has broken the scam down into three core components: Procurement Scam- Liquor distilleries paid commissions of Rs 75 per case to receive preferential treatment from the state-run Chhattisgarh State Marketing Corporation Ltd (CSMCL), parallel black market- a massive supply of unaccounted “kacha” liquor using duplicate holograms bypassed official warehouses, fetching up to Rs 3,000 per case, FL-10A licensing racket-wholesale licenses were allegedly sold to foreign liquor distributors in exchange for kickbacks, allowing syndicate members to claim up to 60% of the profits. The manipulation, ED alleges, was facilitated by placing loyal officials in key departments and allowing the syndicate to control tenders, policy decisions, and staff appointments in the Excise Department.

A Network of Names and Money

The ED's case hinges on testimonies and digital evidence linking Chaitanya Baghel to the syndicate’s financial web. Laxmi Narayan Bansal, alias Pappu—believed to be a key money handler—admitted in his statement to laundering over Rs 1,000 crore in cash in coordination with Chaitanya.

He claimed to have received Rs 136 crore in three months, based on encrypted messages retrieved from the phone of Anwar Dhebar, a key middleman, and brother of ex-Congress mayor. Bansal also told the ED that he delivered huge cash amounts to Congress leader Ram Gopal Agrawal and excise officer KK Srivastava on Chaitanya’s instructions Rs 80–100 crore in one instance alone. He also routed payments through Dipen Chawda, linking the financial trail back to ground-level liquor operations.

Custody Justified, Says ED

The agency argued in court that Chaitanya was non-cooperative during interrogation, refusing to disclose key details about the movement and utilization of funds. His custodial interrogation, the ED said, was vital to confront him with co-accused individuals, corroborate financial data, and trace the full extent of money laundering. The remand was granted by the Special Judge (PMLA) after the ED assured adherence to Supreme Court directives regarding the arrest procedure. The ED has so far attached properties worth over Rs 205 crore in connection with this case. While the ED’s first ECIR in this case, based on an Income Tax complaint, was quashed by the Supreme Court in early 2024, the agency revived its probe after the EOW’s FIR in January. Since then, multiple high-profile individuals have been arrested, including former excise minister Kawasi Lakhma, telecom officer Arun Pati Tripathi, liquor distributor Anwar Dhebar, and retired IAS officer Anil Tuteja. Chaitanya Baghel will remain in ED custody until July 22 as the probe deepens into what is increasingly being viewed as a high-level financial and political scandal that could have wide-ranging implications for the state’s political landscape. “This fight is not about saving Congress leaders, it's about saving Chhattisgarh,” reacted former Chief Minister Bhupesh Baghel on Saturday, as the Chhattisgarh Congress announced a statewide economic blockade on July 22 to protest against ED arrest of his son.