Hyderabad: The Enforcement Directorate on Thursday arrested Karumuri Sunil Kumar, son of former Andhra Pradesh minister Karumuri Nageswara Rao, in connection with the alleged liquor transportation scam involving the Andhra Pradesh State Beverages Corporation Limited (APSBCL). The case is being investigated under the Prevention of Money Laundering Act.The ED has alleged that Sunil was a key conspirator in the manipulation of liquor transportation contracts between 2020 and 2024 and used his political connections to secure sub-contracts for selected entities. He is also accused of exercising control over transportation operations, inflating invoices, and receiving proceeds generated from the contracts.The investigators alleged that Sunil acted as a link between members of the liquor syndicate, local contractors, and officials associated with APSBCL. He allegedly facilitated the award of a transportation sub-contract from Sigma Supply Chain Solutions Private Limited (SSCPSL), described by investigators as a front entity of the syndicate, to Sree Sudarsana Constructions.Sources said Sunil told business associates V Sandeep and Kalluri Surya Pratap Reddy that his father had close relations with the then APSBCL managing director, D Vasudeva Reddy. The agency alleges that Sunil used these connections, along with his links to alleged syndicate leaders Raj Reddy and Kiran Kumar, to ensure that transportation work was awarded to entities selected by the group.ED alleges 85% profit-sharing arrangementSunil reportedly imposed a condition that 85% of the profits generated from the sub-contracted transportation work should be paid to him and his family members as commission, the ED alleged, adding that the arrangement was reached through oral agreements in 2021.Sunil is accused of exercising substantial control over the day-to-day operations of the transportation business. Investigators alleged that he identified and recommended sub-contractors to be brought into the operation, including local political functionaries and YSRCP leaders. He also allegedly instructed the operators to inflate invoices to generate additional funds. On different occasions, amounts ranging from Rs 40 lakh to Rs 60 lakh were allegedly added over and above the actual transportation charges, the ED claimed, while adding that the additional amounts generated through the inflated invoices were allegedly withdrawn in cash on Sunil’s instructions and delivered to locations specified by him.The ED is also examining transfers made under the sub-contract arrangements. According to sources, around Rs 12 crore was transferred or utilised for the benefit of Sunil and members of his family between Nov 2021 and Oct 2023. The transactions allegedly included transfers to the bank accounts of his wife, Valluri Keerthi, and his mother, Karumuri Lakshmi Kiran. Investigators alleged that part of the proceeds was used to purchase luxury watches and meet expenses related to his father’s camp office in Vijayawada. The payments were allegedly made through RTGS from proceeds generated under the transportation contracts. The agency claims that Sunil was a principal beneficiary of the arrangements while also functioning as an intermediary between the syndicate and the contractors.Cash movement and false documentsInvestigators have also alleged the involvement of former minister Karumuri Nageswara Rao in the movement of proceeds generated from the transport tender. The ED claimed that cash ranging from Rs 50 lakh to Rs 60 lakh a month was allegedly sent to Raj Reddy. From this amount, around Rs 20 lakh a month was allegedly delivered to D Vasudeva Reddy as kickback.The ED further alleged that Sunil attempted to create documents to justify the transfer of funds after the investigation began closing in on those associated with the contracts. In Sep 2025, he allegedly pressured and threatened the operators of Sree Sudarsana Constructions to prepare backdated and false documents. The agency claims that the documents were intended to portray the alleged 85% profit share as legitimate business income by showing his wife as a joint partner in the transportation business.Investigators allege that Sunil used political influence to facilitate government-linked transportation contracts, selected sub-contractors, directed inflated billing and benefited from the proceeds generated through the arrangements.The allegations form part of the ED’s money-laundering investigation into the liquor transportation contracts awarded by APSBCL. The agency is examining the tender process, the award of sub-contracts, the flow of funds among the entities and individuals involved, and the alleged conversion and use of the proceeds.
