The Enforcement Directorate in Itanagar carried out coordinated searches at nine locations across Arunachal Pradesh in connection with a large-scale inter-state liquor smuggling and money laundering network, officials said on Monday.
The action, taken under the Prevention of Money Laundering Act, is part of a widening investigation that points to a gang exploiting tax disparities between states.
Officials said that liquor meant for sale in Arunachal Pradesh was illegally diverted and supplied to markets in Assam and other states.
The searches, conducted earlier this week, spanned multiple cities such as Itanagar, Naharlagon, Siba, Ziro, Daporijo, Namsai and Rueng, targeting liquor wholesale companies suspected of being linked to the network.
According to officials, the investigation stems from a series of FIRs registered by the Assam Police regarding illegal transportation of liquor from Arunachal Pradesh to Assam.
Inputs from the Assam Excise Department have strengthened this issue. The Enforcement Status FIR was registered on 17 October 2024, and was later expanded through an annex containing an additional 173 FIRs.
Previous inspections conducted on February 4 last year, at premises linked to three alleged main operators, believed to be major alcohol manufacturers, revealed indications of a well-coordinated operation.
Investigators suspect the network operates through a chain of manufacturers, bonded warehouses and wholesalers, while concealing true ownership using proxy arrangements such as tribal partnerships and fictitious license holders.
During the directorate’s recent operations, the agency found that several wholesale units were operating under agency licenses issued in the names of local individuals, while actual control remained with the suspected masterminds.
The financial audit revealed that between 51 and 90 percent of the total credits in some bank accounts consisted of unjustified cash deposits.
Investigators also noted a pattern of splitting bills, deliberately keeping transactions below $2 lakh to avoid scrutiny. In one case, more than 200 invoices with the same value $1,99,554 created in one month at one place.
Field staff reportedly confirmed that records, including inventory records and daily cash collections, are being routed to offices associated with the alleged monitors.
ED said he almost seized $40 thousand in unaccounted cash during searches.
In a significant discovery, 14 stamps, some of which allegedly belonged to the Excise Department of the Arunachal Pradesh government, were recovered from a building. It is suspected that they were used to create fake transportation permits to facilitate the unauthorized movement of alcoholic beverages.
Officials added that further investigations are underway.
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