Former Andhra Pradesh minister Karumuri Venkata Nageswara Rao was sent to 15 days of judicial custody by a Special Court under the Prevention of Money Laundering Act (PMLA) in Hyderabad on Monday, 24 August, in connection with the APSBCL liquor transportation scam. The Directorate of Enforcement (ED), Hyderabad Zonal Office, had arrested him the previous day from his residence in Hyderabad.

The Arrest and Charges

The ED stated in an official release that Nageswara Rao was arrested under the provisions of the Prevention of Money Laundering Act, 2002, for allegedly acting as a key facilitator in the liquor transportation scam. The central agency initiated its investigation on the basis of an FIR registered by the CID, Andhra Pradesh, which flagged a loss to the government exchequer estimated at ₹195.33 crore.

How the Scam Allegedly Operated

According to the ED, investigations revealed that tender conditions of the Andhra Pradesh State Beverages Corporation Ltd. (APSBCL) were deliberately modified and tailored in favour of select entities — namely Sigma Supply Chain Solutions Pvt. Ltd. (SSCSPL) and subsequently Prasaad Transports — which allegedly functioned as front entities. The actual operational and financial control, the agency said, remained with persons associated with Kessireddy Raja Shekhar Reddy and Dontireddy Vasudeva Reddy.

The ED further alleged that Kessireddy Raja Shekhar Reddy, Tukekula Eswar Kiran Kumar Reddy, and Anjani Kumar, in active connivance with Dontireddy Vasudeva Reddy — the then Managing Director of APSBCL — abused their influence to secure liquor transportation tenders at rates substantially higher than prevailing market rates, thereby generating proceeds of crime. SSCSPL was used to participate in the tender process, while actual execution was reportedly carried out by Tukekula Eswar Kiran Kumar Reddy alias Kiran Kumar under the direct supervision of Kessireddy Raja Shekhar Reddy alias Raj.

Nageswara Rao's Alleged Role

The ED investigation established that Nageswara Rao, along with his son Sunil Kumar, allegedly leveraged political influence and close association with members of the liquor syndicate to exercise substantial control over the allotment of liquor transportation sub-contracts, deriving significant illicit financial gains in the process. According to the agency, the proceeds of crime were used to acquire luxury assets — including high-end motor vehicles and watches — make advances toward immovable properties, fund political activities, and meet personal and family expenditures through both direct banking transfers and cash transactions.

Earlier Arrests and Attached Properties

This is not the first arrest in the case. The ED had previously arrested Kessireddy Raja Shekhar Reddy and Dontireddy Vasudeva Reddy on 11 June 2026, and Sunil Kumar on 18 June 2026. All three remain in judicial custody. A provisional attachment order covering properties worth ₹37.79 crore was issued on 6 August, and the first prosecution complaint was filed before the Special Court on 7 August against the three arrested persons and others. Further investigation is ongoing.

The case marks a significant escalation in the ED's probe into alleged financial irregularities within Andhra Pradesh's state-run liquor distribution network, with multiple high-profile arrests now on record.