Interstate liquor smuggling racket under scanner as ED raids nine locations in Arunachal

The Enforcement Directorate (ED) has conducted coordinated searches at nine locations across Arunachal Pradesh as part of an ongoing investigation into a suspected large-scale interstate liquor smuggling and money laundering network, officials said on Monday, April 26.

The probe, carried out under the Prevention of Money Laundering Act (PMLA), is part of an expanding probe into an alleged syndicate exploiting tax differentials between states. According to officials, liquor intended for sale within Arunachal Pradesh was diverted and illegally supplied to markets in Assam and other neighbouring states.

The searches, conducted earlier this week, covered multiple towns including Itanagar, Naharlagun, Seppa, Ziro, Daporijo, Namsai and Roing. Wholesale liquor businesses suspected of links to the network were among the primary targets of the operation.

Officials stated that the investigation originated from a series of First Information Reports (FIRs) registered by Assam Police concerning the illegal transportation of liquor from Arunachal Pradesh into Assam. Inputs from the Assam Excise Department further strengthened the case.

An Enforcement Case Information Report (ECIR) was registered on October 17, 2024. The probe was later expanded through an addendum incorporating 173 additional FIRs, indicating the scale of the alleged operation.

Earlier searches conducted on February 4 last year at premises linked to three alleged key operators—believed to be major liquor manufacturers—had revealed indications of a structured and coordinated network.

Investigators suspect that the syndicate operated through a chain involving manufacturers, bonded warehouses and wholesalers, while concealing actual ownership through proxy arrangements. These included the use of tribal partnerships and dummy licence holders to bypass regulatory scrutiny.

During the latest searches, the ED found that several wholesale units were operating under proxy licences issued in the names of local individuals, while effective control remained with the suspected masterminds.

Financial analysis carried out during the investigation revealed irregular patterns in bank transactions. In certain accounts, between 51 per cent and 90 per cent of total credits consisted of unexplained cash deposits.

Officials also identified a pattern of invoice splitting, with transactions deliberately structured below ₹2 lakh to evade detection. In one case, more than 200 invoices of identical value—Rs 1,99,554—were generated within a single month at a single location.

The investigation remains ongoing, and officials indicated that further action may follow based on the findings.