Two private company executives were arrested on Thursday by the Enforcement Directorate (ED) in a case related to alleged irregularities in the now-scrapped Delhi excise policy in which Delhi Deputy Chief Minister Manish Sisodia is an accused.

The two arrested were Benoy Babu, general manager of liquor company Pernod Ricard, and P Sarath Chandra Reddy, whole time director and promoter of Aurobindo Pharma.

Initially, the Hyderabad-based Aurobindo Pharma Ltd. said in its filing to the BSE that it was "in the process of ascertaining further details and will do further disclosures as appropriate."

Later, in a separate filing, the company informed the BSE that the arrest of Reddy, is "not in any way connected with the operations of Aurobindo Pharma Limited or its subsidiaries". The share prices of the company fell about 12 per cent in the BSE after news of the arrest came.

Besides these two, the ED had arrested Sameer Mahandru, managing director of liquor manufacturing company Indospirit, in September.

Officials claimed they were "evasive" during the questioning.

The two were allegedly involved in the formulation of the Delhi excise policy along with government officials and also had a role in the "cartelisation" of the entire network, the officials said.

The ED claimed to have recovered a draft of the policy from one of the executives when the premises were searched earlier. The agency also claimed to have found that investments worth Rs 200 crore in the retail liquor business were made by an entity in violation of the policy directives, they alleged.

The ED has conducted multiple raids in this case so far.

The agency early this month raided the premises of a PA of Delhi Deputy chief minister Manish Sisodia and later questioned him at its office in Delhi.

The money laundering case stems from a CBI FIR that had named Sisodia as an accused among others. The CBI had raided the premises of the deputy chief minister and some Delhi government bureaucrats after filing the case.

The excise scheme came under the scanner after the Delhi LG recommended a CBI probe into the alleged irregularities in the implementation of the Delhi Excise Policy 2021-22. The LG had also suspended 11 excise officials.

The ED has questioned AAP MLA Durgesh Pathak and minister Satyendar Jain, currently in jail in an another money laundering case, in this case.

The CBI has also arrested two people in this case. The first one was Vijay Nair, former CEO of an entertainment business company, and the second one was liquor businessman Abhishek Boinpally.

The CBI inquiry was recommended on the findings of the Delhi chief secretary's report filed in July showing prima facie violations of the GNCTD Act 1991, Transaction of Business Rules (ToBR)-1993, Delhi Excise Act-2009, and Delhi Excise Rules-2010, officials had said.