Published Jul 30, 2026 | 3:08 PM ⚊ Updated Jul 30, 2026 | 3:11 PM
Kerala CM VD Satheesan. Credit: facebook.com/VDSatheeshanParavur
Synopsis: The UDF government has closed the Vigilance case against Chief Minister V.D. Satheesan over the Punarjani flood rehabilitation project, saying years of investigation found no evidence of corruption. The decision is likely to reignite a political battle, with the Home Minister calling the case a “politically motivated” exercise by the previous LDF regime. The CPI(M) has questioned the clean chit, claiming there was sufficient evidence against the CM.
The United Democratic Front (UDF) government on Thursday, 30 July, formally closed the long-running Vigilance case against Chief Minister V.D. Satheesan, bringing to an end an investigation initiated by the previous Left Democratic Front (LDF) regime over the Punarjani flood rehabilitation project in Paravur.
Announcing the decision after examining the Vigilance and Anti-Corruption Bureau’s (VACB) findings, Home Minister Ramesh Chennithala said there was no legal or factual basis to continue proceedings against the CM.
He described the case as a politically driven exercise launched by the previous dispensation to target Satheesan, the then Leader of Opposition in Kerala Assembly.
“It was all politically motivated. That has become clear now,” Chennithala told reporters, adding that he had personally gone through the files submitted by the Vigilance Director before approving the closure of the case.
The allegations date back to 2019, when Satheesan travelled to the United Kingdom at the invitation of an Ernakulam-based charitable organisation to mobilise financial assistance for rebuilding houses and providing sewing machines to the 2018 flood victims in Paravur, his Assembly constituency.
The rehabilitation initiative was carried out under the banner of the Punarjani project.
The complaint alleged large-scale irregularities in the utilisation of foreign contributions received for the scheme.
However, successive Vigilance inquiries failed to uncover evidence linking Satheesan to any financial wrongdoing even as the agency pointed out that his role in soliciting contributions amounted to a violation of Section 3(2)(a) of the FCRA, which bars elected representatives from receiving foreign contributions.
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According to Chennithala, the VACB examined the matter repeatedly and found no Vigilance angle warranting prosecution.
The bureau investigated the case in 2020, 2023 and 2025, with two successive Vigilance Directors arriving at the same conclusion.
Quoting the latest VACB report, the Home Minister said Satheesan had no role in receiving, handling or disbursing the funds used for the Punarjani project. The money was routed directly to the Manappad Foundation, a charitable organisation registered under the Foreign Contribution (Regulation) Act (FCRA), through authorised banking channels.
According to the agency’s findings, £22,500 (₹19.95 lakh) was collected in the U.K. and transferred to the foundation’s designated FCRA account through Midland International Aid Trust (MIAT), a U.K.-based non-governmental organisation.
The transactions were duly audited and reflected in the foundation’s statutory financial records and mandatory filings.
VACB also cited a video recorded at a fundraising programme in Birmingham in 2019, in which Satheesan is seen appealing to those present to contribute £500 each for purchasing sewing machines for women affected by the floods. The agency has treated the video as part of its evidence.
“The Chief Minister was not directly involved in any financial transaction, nor did the probe find any evidence against him,” Chennithala said. “He neither handled the funds nor interfered in their utilisation at any stage.”
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Chennithala also said the previous LDF government attempted to pursue the matter further by proposing a Central Bureau of Investigation (CBI) probe despite the absence of evidence.
He criticised that move, alleging it was intended to keep the allegations alive for political reasons rather than on the strength of the investigation.
He noted that the Vigilance agency itself had not recommended a CBI investigation.
Instead, it had merely pointed out that any suspected violation of the FCRA, would fall within the jurisdiction of the Union Ministry of Home Affairs and that the CBI would be the competent agency to investigate such offences if required.
The VACB had also clarified that the state government had no jurisdiction to investigate alleged FCRA violations and that its consent was not a prerequisite for a CBI probe under the law.
The controversy had gathered momentum in the run-up to the 2026 Assembly elections after the Vigilance indicated possible offences under the FCRA, although it could not invoke provisions of the Prevention of Corruption Act.
However, investigation hit a legal dead end after it was found that the foreign contributions were transferred directly to the NGO and not to Satheesan or any account linked to him.
Unable to establish a corruption case, the VACB had observed that any suspected violation of the FCRA fell outside the state agency’s jurisdiction.
Chennithala alleged that the previous government had used the case as a political weapon to target Satheesan and blunt the Congress’ attacks over corruption allegations in the LIFE Mission project.
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As Leader of the Opposition, Satheesan had consistently maintained that the allegations were fabricated to divert public attention from politically embarrassing developments confronting the LDF.
Defending the Punarjani project in the Assembly last year, he said the Manappattu Foundation was duly registered under the FCRA and that every transaction was carried out through authorised banking channels, audited and reflected in the trust’s financial records.
He also maintained that he had not received any financial assistance personally and that his visit to the U.K. was solely to present the rehabilitation project and seek support for flood victims.
He had also accused the Pinarayi Vijayan-led government of attempting to shift focus from the conviction of former Transport Minister Antony Raju in an evidence-tampering case by reviving the Punarjani issue.
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CPI(M) state secretary M.V. Govindan on Thursday alleged that Chennithala had acted in “undue haste” to give Satheesan a clean chit in the case and claimed that there was sufficient evidence against the CM.
Addressing a press conference, Govindan questioned whether Satheesan had obtained the required permission as an MLA to seek foreign funds and whether existing laws permitted such fund-raising.
Noting that the Centre had not granted permission to state ministers to seek assistance from abroad in the aftermath of the floods, Govindan questioned how Satheesan could travel to the UK and conduct fund-raising.
Govindan demanded an investigation into who had facilitated the fund-raising, how much money had been received, and whether the funds had been withdrawn without the mandatory approvals.
He alleged that the Home Minister’s decision to publicly rule out wrongdoing is nothing short of extraordinary.
(Edited by Fayisa CA)
