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The Enforcement Directorate Friday filed a money laundering case against Bharat Rashtra Samithi (BRS) leader K T Rama Rao and some others in a case linked to alleged payment irregularities during the Formula-E race held in Hyderabad in February 2023, official sources said.
An Enforcement Case Information Report (ECIR) – the ED’s equivalent of a First Information Report (FIR) — has been registered under various sections of The Prevention of Money Laundering Act, 2002, taking cognisance of an FIR filed by the Telangana Police’s anti-corruption bureau (ACB) Thursday, the sources said.
The accused in the ED case are the same as those mentioned in the ACB FIR, they said.
The development comes hours after the Telangana High Court, in an interim order, directed the state’s ACB to not arrest Rao, a former Telangana minister, till December 30. Rao had filed a lunch motion to quash ACB’s FIR filed against him.
However, the court said investigation against the politician could continue and ordered the ACB to file a response to his petition. The case will now be heard on December 27.
On Thursday, the ACB had filed a case against KTR, son of former chief minister K. Chandrashekar Rao, in connection with alleged irregularities in bringing the Formula-E car racing event to Hyderabad in February last year. The FIR was registered under the Prevention of Corruption Act as well as under IPC sections 409 (criminal breach of trust) and 120B (criminal conspiracy).
While KTR was named the primary accused in the case, former Municipal Administration and Urban Development (MAUD) principal secretary Arvind Kumar was named the second accused and former Hyderabad Metropolitan Development Authority (HMDA) chief engineer BLN Reddy the third.
The case relates to alleged mismanagement of funds and payments made when KTR was the state’s minister for MAUD, which had worked towards bringing the Formula-E race to Hyderabad.
According to the FIR, KTR failed to take clearance from the state cabinet before authorising Arvind Kumar to make payments.
The ACB alleged that the HMDA paid Rs 45 crore in two instalments to the foreign company, Formula-E Organisers (FOE), in violation of Reserve Bank of India guidelines. The RBI imposed a fine of Rs 8 crore on the Telangana government, then headed by his father, for unauthorised transactions, which was later paid by the Congress government after coming to power late last year, the FIR said.
According to the FIR, when the new government investigated why the RBI had imposed the fine, the alleged violations and financial irregularities in the conduct of the event were discovered, following which the ACB began its investigation.
— With inputs from ENS and PTI
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