How Kavitha’s auditor Butchi babu devised a system to send Rs 100 Cr kickbacks

Hyderabad: Butchi Babu Gorantla, a Hyderabad-based auditor and a close aide of BRS MLC K Kavitha will appear before the Enforcement Directorate on March 15.

A day later, Kavitha will follow. She has been summoned for the second time by ED, while her close aide Arun Ramachandra Pillai continues to be in ED’s custody.

Butchi Babu was earlier arrested by the Central Bureau of Investigation for his alleged role in the now-scrapped Delhi Liquor Policy. CBI named him in the charge sheet and accused him of acting on behalf of the ‘South group’ allegedly led by Kavitha, former MD Aurobindo P Sarath Reddy, and YSRCP Ongole MP Magunta Srinivasulu Reddy and his son Raghava.

A source told NewsMeter that Butchi babu was the key person who devised the entire system to send Rs 100 Crore kickbacks to Delhi on behalf of the South Group. “He devised a plan in which he sent Rs 100 crore to Delhi and claimed credit notes with the help of hawala operators. While he did this he served as the auditor to Kavitha and other biggies in two Telugu-speaking states,” he added.

This came to the fore when accused Arun Ramachandra Pillai, a close associate of Kavitha, allegedly spilled the beans against her and South Cartel during questioning by the Enforcement Directorate. He told ED that he was acting on behalf of MLC Kavitha. He told investigators that the 30% stake he held in the Indo sports company was not his, but Kavitha’s.

ED followed it up by issuing summons to Kavitha. Enforcement Directorate sleuths have confiscated Kavitha’s cell phones. She is likely to be confronted by Arun Ramachandra Pillai who is in the custody of the ED and Butchi babu.

It is pertinent to note, Kavitha changed the device of both her phone numbers 10 times. At least 36 accused and suspects involved in the scam have destroyed or used 170 phones, the ED’s remand report claimed.

ED has named Kalvakuntla Kavitha as one of the key members of the ‘South Group’. ED said arrested businessman Vijay Nair, on behalf of AAP leaders, received kickbacks to the tune of Rs. 100 Crore from ‘South Group’.

Against the kickbacks paid, the South group secured uninhibited access, and undue favors, and attained stakes in the wholesale business and multiple retail zones. The retail business was highly lucrative and the members of the group received high profits on daily bases. The retail sales were in cash, the chargesheet added.

South Group controlled Khao Gali:

Besides Aurobindo Group MD P. Sarath Reddy, and YSRCP MP Magunta Srinivasulu Reddy, BRS MLC Kavitha was running the ‘South Cartel’ in the Delhi Liquor policy Scam, ED said in its chargesheet copy.

Cartel controlled 9 retail zones in Delhi including 2 in Khao Gali. Out of the 9 zones, two were controlled by Magunta’s son Raghav in the name of Magunta Agro firms and 5 by P Sarath Reddy in the name of Trident, Organomix, and Avantika.

“The South group showed interest in investing in the Delhi Excise policy since they had deep pockets, strong political connections, and were allies of Delhi Chief Minister Arvind Kejriwal,” the remand copy said.

Enforcement Directorate (ED) filed a prosecution complaint (chargesheet) in the Delhi Liquor policy scam before the sessions judge in New Delhi on December 20.