The agency named Bharat Rashtra Samithi working president K T Rama Rao as Accused No. 1 and Indian Administrative Service officer Arvind Kumar as Accused No. 2.

Former Hyderabad Metropolitan Development Authority chief engineer B L N Reddy was listed as Accused No. 3, sports consultant Kiran Malleswara Rao as Accused No. 4, and UK-based Formula-E Operations as Accused No. 5. The chargesheet alleges that ₹55 crore was directly diverted to foreign entities in violation of rules.

Probe cites electoral bonds angle, alleged quid pro quo

Investigators stated that responsibilities were handed to Ace NextGen, which had an agreement with Formula-E Operations. The chargesheet reportedly mentions that Bharat Rashtra Samithi received ₹45 crore in electoral bonds from the company as part of a quid pro quo.

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Sanction to prosecute K T Rama Rao was granted by then governor Jishnu Dev Varma in November last year. The ACB registered a special investigation report in the case on December 18, 2024.

Based on the ACB case, the Enforcement Directorate also registered a separate case. Officials from both agencies questioned Arvind Kumar, B L N Reddy and K T Rama Rao during the probe. The chargesheet alleges misuse of funds, cheating and criminal conspiracy.

Race agreement and financial transactions form case background

During the Bharat Rashtra Samithi government's tenure, a Formula-E race was conducted near Hussain Sagar in February 2023. A tripartite agreement was signed on October 25, 2022, between Formula-E Operations, Hyderabad-based Ace NextGen, a Greenko group affiliate, and the Municipal Administration and Urban Development department.

Under the agreement, the department was to provide infrastructure, including track construction, for Seasons 9 to 12 around Hussain Sagar. Season 9 was held on February 11, 2023.

Differences later arose between Ace NextGen and Formula-E Operations. The latter informed the state government that the race would be stopped due to non-payment of dues.

Following directions from the then municipal administration minister K T Rama Rao, a fresh agreement was signed in October 2023 between Formula-E Operations and the department under the leadership of Arvind Kumar. The agreement stated that ₹110 crore, including sponsor fees and taxes, would be paid for organising the race. An undertaking was also given to spend another ₹50 crore on municipal services and civil works.

As part of the arrangement, ₹160 crore from Hyderabad Metropolitan Development Authority board funds was approved. For organising Season 10, ₹45,71,60,625 was transferred in foreign currency to Formula-E Operations from the authority's general funds on October 3 and October 11, 2023.

The Income Tax department later imposed a penalty of ₹8.07 crore on the authority, citing violation of Reserve Bank of India rules in the transaction. After the Congress government came to power, the ACB registered a case.

In its preliminary findings, the authority stated that ₹54,88,87,043 had been misused. Cases were registered against 10 persons. As part of the investigation, ACB officials questioned K T Rama Rao, Arvind Kumar and B L N Reddy twice, and examined representatives of Formula-E Operations online.