Justice M Nagaprasanna ordered the stay, citing potential abuse of law against the officers performing their duties.
Published Jul 23, 2024 | 8:49 PM ⚊ Updated Jul 23, 2024 | 8:51 PM
Karnataka High Court. (Creative Commons)
The Karnataka High Court on Tuesday, 23 July stayed the FIR against two Enforcement Directorate (ED) officials investigating the multi-crore scam at the Karnataka Maharshi Valmiki Scheduled Tribes Development Corporation Ltd.
Justice M Nagaprasanna ordered the stay, citing potential abuse of law against the officers performing their duties.
The officials were charged by the Bengaluru police based on a complaint from Additional Director of the Karnataka Social Welfare Department, Kallesh B, who alleged coercion, during his questioning by the ED, to implicate former Minister B Nagendra and Chief Minister Siddaramaiah in connection with the alleged financial irregularities at the state-run Corporation.
Additional Solicitor General Aravind Kamat, representing the ED, argued that the officers were booked while executing their official duties.
Justice Nagaprasanna emphasised that allowing such investigations could deter officers from performing their duties, likening the situation to “innovative filmy style ideas” and warning against opening a “Pandora’s Box.” The court adjourned further hearing to 21 August.
Talking about the court staying further proceedings pertaining to the FIR registered against two ED officials, Advocate General Shashi Kiran Shetty told South First: “We have argued that FIR is already filed against the officials. The complaint is filed before the CBI but the ED is showing more anxiety. ED is allowed to only recover money but arresting people is not permitted.”
The AG explained, “The court has stayed the further proceedings in connection to the FIR. We are yet to get the order copy. We will discuss with the government and then take further decision on appealing before the Supreme Court against the high court order.”
Kallesh has accused an ED official named Murali Kannan and an officer by the surname Mittal. He alleged that Mittal threatened to frame him in the case and said that if he wanted the ED to help him, he should “name the Chief Minister, Nagendra and the Finance Department.”
The two were booked for criminal intimidation under the Bharatiya Nyaya Sanhita.
The illegal money transfer case came to light after P Chandrashekar — accounts superintendent at the Corporation — died by suicide. In a purported suicide note, he said some officials had pressured him to transfer crores of money to an unofficial account.
In the six-page suicide note accessed by South First, he had levelled allegations of corruption to the tune of ₹88 crore against the KMVSTDC’s Managing Director, Accountant, and the manager of Union Bank of India’s MG Road branch.
The investigation began after two FIRs were filed by the Karnataka Police and the Central Bureau of Investigation (CBI) following the tragic suicide of Chandrashekhar on 26 May this year. The death note revealed the unauthorised transfer of ₹187 crore belonging to the Corporation from its bank account, and from that, ₹88.62 crore was illegally moved to various accounts allegedly belonging to “well-known” IT companies and a Hyderabad-based cooperative bank.
Chandrashekhar had named the Corporation’s now suspended Managing Director JG Padmanabha, accounts officer Parashuram G Durugannavar, and Union Bank of India Chief Manager Suchismita Rawal in the note, while also stated that “the minister” had issued oral orders for transferring the funds.
It may be noted that on 18 July, Siddaramaiah’s cabinet ministers including Santosh Lad, Priyank Kharge and Krishna Byre Gowda had alleged that the ED and the CBI had taken over the probe of the Valmiki scam to destabilise the Congress government.
Former minister Nagendra resigned following allegations against him and ED officials eventually arrested him after conducting raids at his properties. “A substantial amount of funds were utilised to procure a significant quantity of liquor just prior to the general elections. Additionally, high-end vehicles, including a Lamborghini, were purchased using proceeds from the scam,” said the agency.
During searches at the residences of the former minister and MLA Daddal, the ED said it recovered “incriminating” documents linking them to the misappropriated funds used during the recent general elections.
Nagendra’s associates were also implicated in the diversion and management of the illicit funds.
(Edited by Neena with inputs from Mahesh M Goudar and PTI)
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