The Anti-Corruption Bureau in Telangana on Thursday booked Bharat Rashtra Samithi leader and former state minister KT Rama Rao in connection with alleged irregularities in conducting the Formula E car racing event in Hyderabad in February 2023, reported The Indian Express.

Aravind Kumar, the former Municipal Administration and Urban Development principal secretary, and BLN Reddy, the chief engineer of the Hyderabad Metropolitan Development Authority at the time, were also named in the first information report.

The FIR was registered on a complaint filed by Municipal Administration and Urban Development Principal Secretary M Dana Kishore on Wednesday, according to The Hindu.

Kishore alleged that a payment of Rs 54.88 crore was made to Formula E Operations Limited and others in “gross violation of established procedures” while Rao was the Municipal Administration and Urban Development minister.

Rao, son of former Chief Minister K Chandrashekar Rao, has denied irregularities in the payments made for the events.

The Telangana High Court on Friday granted interim relief to Rao. The court ordered that the former minister cannot be arrested in the matter till December 30.

According to the FIR, the Municipal Administration and Urban Development department signed an agreement with United Kingdom-based Formula E Operations Limited and India-based Ace Nxt Gen Private Limited for conducting the Formula E races for seasons 9, 10, 11 and 12 in Hyderabad, reported The Hindu.

Ace Nxt Gen Private Limited was the sponsor for the event.

Season 9 of the event was conducted on February 11, 2023, for which the Telangana government incurred an expenditure of Rs 12 crore.

However, Ace Nxt Gen Private Limited backed out of the agreement before season 10, following which, discussions were held for the state government to take up the role of the sponsor, according to the FIR.

Following this, Formula E Operations Limited furnished two invoices before the government – first for Rs 22.69 crore on September 25, 2023, and second for Rs 23.01 crore on September 29, 2023.

The chief engineer of the Hyderabad Metropolitan Development Authority at the time approved the transfer of the amounts on October 3, 2023, and October 11, 2023, respectively, claimed the FIR.

The Anti-Corruption Bureau has alleged that approval was not sought from relevant authorities before transferring the amount in British pounds.

“The foreign remittances resulted in additional tax burden to the HMDA, which was made to pay Rs 8.06 crore to the Income Tax department towards withholding tax for two instalments,” alleged the bureau.

The Hyderabad Metropolitan Development Authority had also released Rs 1.10 crore to the Federation of Motor Sports Clubs of India, as calendar and permit fee for the racing event, taking the total sum incurred to Rs 54.88 crore.

The federation provides support in the form of infrastructure and technical kits for the Formula E races in India.

“All these payments were made from the general funds of HMDA,” The Hindu cited the FIR having alleged. “As per the established procedure in HMDA, administrative sanction for works/expenditure of amounts exceeding Rs 10 crore should be obtained from the government, which accords such sanction in concurrence with the finance department. In this case, it is noticed that this procedure was not followed.”

Further, it alleged that the payments were made even though Formula E Operations Limited terminated the agreement on October 27, 2023.

“Apparently, these payments were made in anticipation of an agreement that was supposed to be executed,” the FIR was quoted as having alleged. “This is a grave irregularity.”

A new agreement was signed on October 20, 2023, between Formula E Operations Limited and the Municipal Administration and Urban Development in violation of the Model Code of Conduct in Telangana.

The model code of conduct was imposed in the state on October 9 ahead of the Assembly elections.

Rao had previously stated that he was “willing to go to jail if anything illegal is found”, reported The Indian Express.

He had said that he told Kumar to transfer the funds to Formula E Operations Limited while looking for other sponsors.

“I gave the instructions as vice-president of HMDA,” the former minister had said. “The HMDA operates independently and does not need approval from finance department or Cabinet.”