The Supreme Court on Wednesday refused to quash a first information report against Bharat Rashtra Samithi leader KT Rama Rao in connection with alleged irregularities in the Formula E motorsport event that Hyderabad hosted in February 2023, reported Live Law.

The bench of Justices Bela M Trivedi and PB Varale said it was not inclined to interfere in the matter at the current stage and dismissed Rao’s plea against a Telangana High Court order refusing him relief.

The Telangana Police’s Anti-Corruption Bureau had filed the FIR against Rao on December 19 based on a complaint filed by Municipal Administration and Urban Development Principal Secretary M Dana Kishore.

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

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

The Bharat Rashtra Samithi MLA was booked under the Indian Penal Code section pertaining to criminal breach of trust (409). The Prevention of Corruption Act was also invoked.

Subsequently, Rao moved the High Court seeking to quash the case. On December 20, the court granted him interim protection from arrest.

However, on January 7, the Telangana High Court lifted the stay on his arrest and refused to quash the charges against Rao. The former Telangana minister then moved the Supreme Court.

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

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, prompting discussions about whether the state government could sponsor the event.

Formula E Operations Limited subsequently furnished two invoices to the government – one for Rs 22.69 crore on September 25, 2023, and the 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, claimed the FIR.

These transfers, in British pounds, are said to be in violation of Reserve Bank of India regulations, prompting the central bank to impose a fine of Rs 8 crore on the Telangana government, which at the time was headed by K Chandrashekar Rao, according to The Indian Express.

The fine was paid by the Chief Minister Revanth Reddy-led Congress government that was elected in December 2023. The new government investigated the cause of the fine and discovered alleged violations and financial irregularities, prompting action by the Anti-Corruption Bureau.

The Anti-Corruption Bureau has also alleged that requisite approval was not sought from relevant authorities before the amount was transferred to Formula E Operations Limited.