Karnataka High Court Rejects Union Bank’s Plea to Transfer Valmiki Corporation Scam Case to CBI

Bengaluru: Karnataka High Court on Wednesday dismissed a petition filed by Union Bank of India seeking a direction to government to transfer probe being carried out in alleged scam regarding Karnataka Maharshi Valmiki Scheduled Tribes Development Corporation Ltd, to Central Bureau of Investigation (CBI). 

A single judge bench of Justice M Nagaprasanna while prouncing verdict orally said, "I have t accepted interpretation of Section 35A (Banking Regulation Act) to become a ground for reference to CBI. If I permit that every banking institution may ask. DSP Act may become redundant".

high court h previously reserved its decision on September 30 after hearing arguments from both sides, specifically on wher bank’s petition met conditions for consideration by Supreme Court under Article 131, and if Section 35A justified a CBI transfer without violating Delhi Special Police Establishment Act.

Karnataka government opposed bank’s petition, arguing that state police have authority over case and that this jurisdiction cant be overridden by central government. 

Senior vocate B V Acharya, representing state, argued that investigation powers are a statutory right of state police and are t subject to central intervention. 

He also argued that matter should be dressed by Supreme Court, t High Court, as it involves jurisdictional authority between central and state governments.

KMVSTDC scandal surfaced when Chandrasekaran, a superintendent at corporation, died by suicide, leaving a te alleging corruption worth crores and naming several officials. 

Following this, B. Nndra, Scheduled Tribes Welfare Minister, resigned and was subsequently detained by Enforcement Directorate. 

On May 29, KMVSTDC Managing Director A. Rajashekar filed a formal complaint alleging that Rs 94.73 crore h been illegally siphoned from corporation’s account with Union Bank of India through falsified board resolutions.

What led to Valmiki case

Valmiki case came to light after a corporation official, Chandrasekaran, who worked as a Superintendent, ended his life, leaving behind a te. 

te accused certain corporation officials of corruption worth crores. 

In a six-p suicide te recovered by police, Chandrasekaran named three officials and alleged multi-crore corruption in corporation, calling for action against m. 

As a result, " Scheduled Tribes Welfare Minister, B Nndra, resigned and is currently in Enforcement Directorate custody." ditionally, A Rajashekar, Managing Director of KMVSTDC, filed a complaint on May 29, stating that "Rs 94.73 crore was taken from corporation's account in Union Bank of India (UBI) using fake board resolution signatures to transfer funds to multiple accounts."