For the first time a political party — AAP — is being legally treated as an “association of persons” for prosecuting it under the Prevention of Money Laundering Act (PMLA) on charges of being a beneficiary of proceeds of crime allegedly committed by top party leaders such as Delhi CM Arvind Kejriwal in the liquor policy case.

To complete the money trail, the ED is making AAP an accused in the money laundering case along with its party leaders who may not have monetarily benefited in individual capacities, sources said. The ED has alleged that ₹100 crore bribe offered by South Group, which included arrested BRS MLC Kavitha, to get liquor business in the national capital which was allegedly used by AAP to fund election in Goa.

The move, its learnt, is an answer to the common plea by Kejriwal and other co-accused like former Deputy CM Manish Sisodia and MP Sanjay Singh, claiming that the agency has not been able to establish money trail linking them or recovered money from their possession or premises during raids in the case.

‘legal entity’

“As per the PMLA, the definition of a company is wide. It also includes an association of persons. Aam Admi Party is also an association of Indian persons,” Additional Solicitor General SV Raju said.

Association of persons is a definition of a company that comes under the “Explanation” to Section 70 of the PMLA which deals with “Offences by Companies”. “For purpose of this section -- (i) “company” means any body corporate and includes a firm or other association of individuals,” the Explanation read. So, AAP is a legal entity in the case.

In October 2023, the agency had informed Supreme Court, during a hearing on bail petition moved by Manish Sisodia who continues to languish in jail even now, that it plans to make AAP an accused in the Delhi liquor policy case but how that would happen has emerged only now.

Curious case

On Wednesday, during a hearing in Delhi High Court, which has reserved its order on Kejriwal’s petition challenging his arrest by the ED on March 21, ASG Raju argued, “the money trail is there. We have located the money trail. The money may have been used and that is why it can’t be found”.

He also told the Delhi High Court Justice Swarna Kanta Sharma that the ED has WhatsApp chats and hawala operators’ statements as well as a large amount of Income tax data to hold its case. All large payments given to the vendors of the AAP campaign were paid in cash and the same were not accounted for in the books of accounts, Raju charged in the court.

Kejriwal, who himself argued in the court, that his arrest has an underpinning motive of “demolishing his party” before the 2024 Lok Sabha elections. Appearing for Kejriwal, senior advocate Abhishek Manu Singhvi too questioned the timing of Delhi CM’s arrest, given that the Model Code of Conduct for elections was in force.

Never before a whole political party has been made an accused in an economic offence or bribery case. This despite the fact that there have been instances in the past that a party as a whole was found complicit in a criminal case as it was in the infamous JMM bribery case of 1993.