Arvind Kejriwal was arrested by the Enforcement Directorate on Thursday.
The Aam Aadmi Party has made it clear that Arvind Kejriwal will remain the Delhi Chief Minister despite his arrest in the liquor policy case. While no law would stop the AAP leader from running the state from prison, the jail guidelines would make it extremely difficult.
A former law officer of Delhi's Tihar Jail says that an inmate can only hold two meetings in a week, which would make it difficult for Mr Kejriwal to carry out his responsibilities as Chief Minister.
"Running a government from jail is not straightforward. The jail manual states that you can meet your family, friends, or associates only twice a week. So it will not be easy for him to govern with these restrictions," Sunil Gupta tells NDTV.
But the official says there is one way that Mr Kejriwal could carry on as Chief Minister. The Lieutenant Governor has the power to convert any building into a prison, and if Mr Kejriwal can convince him to put him under house arrest - it would help him be a part of the Delhi government's day-to-day functioning.
"The Administrator has the authority to declare any building as a jail," Mr Gupta elucidated, drawing parallels with past instances where court complexes were designated as temporary jails. Such measures, he suggested, could potentially facilitate Arvind Kejriwal's governance from within confinement.
Former Jharkhand Chief Minister Hemant Soren -- who was arrested in January in connection with an alleged land scam -- was taken into custody by the Enforcement Directorate after he met the Governor and stepped down from the post. The Chief Minister's post was handed over to party leader Champai Soren.
In 1998, when Lalu Prasad Yadav, then Chief Minister of Bihar, got arrested in the fodder scam case, he handed over his charges to his wife Rabri Devi.
Mr Kejriwal was arrested after he skipped summons for questioning for a ninth time in the liquor policy case and the Delhi High Court refused to grant him protection from arrest.
After Mr Kejriwal's arrest on Thursday, AAP's Atishi, who is currently number 2 in the Delhi government, said that there will be no change in the party's leadership.
"Arvind Kejriwal is and will remain the Chief Minister of Delhi... there are no two ways about it," said Atishi.
But sources say the Union Home Ministry is examining the ramifications of Mr Kejriwal not resigning. Legal experts said the Centre may have to suspend or remove him from the post since he is a public servant. This is also the procedure that is followed for government officials who are arrested. They are immediately suspended from service, sources said.
The scrapped excise policy, introduced to bring an overhaul to the national capital's liquor business, promised a more modern shopping experience with discounts and offers. However, Delhi Lieutenant Governor Vinai Kumar Saxena's order to investigate alleged irregularities prompted the policy's cancellation.
The ED's case is that the Delhi liquor policy 2021-22 provided an exceptionally high-profit margin of 12 per cent for wholesalers and nearly 185 per cent for retailers. Of the 12 per cent, 6 per cent was to be recovered from wholesalers as kickbacks for AAP leaders, and the "South Group" allegedly gave Rs 100 crore in advance to another accused, Vijay Nair, who was linked to the AAP.
A key focus of the investigation into the Delhi liquor policy case was on an alleged network of middlemen, businessmen and politicians which the central agencies have called the "South Group".
Two prominent AAP leaders, Manish Sisodia and Sanjay Singh, are already under judicial custody in connection with the case. Mr Sisodia, the former Delhi Deputy Chief Minister, was arrested by the Central Bureau of Investigation (CBI) on February 26 last year, while Mr Singh, a Rajya Sabha member, was arrested by the ED on October 5.