Hyderabad: Justice K Lakshman of Telangana High Court on Tuesday directed the prime accused in the Insurance Medical Services scam, Kamma Srinivasa Rao and Kancherla Srihari Babu, a partner of Omni Medi Co, to surrender before the special court to start the trial.
Rao is director of M/s Ranchi Expressway Ltd (Madhucon group) that belongs to TRS MP Nama Nageshwara Rao. The cases were registered by the Enforcement Directorate under the Prevention of Money Laundering Act.
The judge directed the concerned court to consider their remand afresh, when the said court refused their remand. ED had arrested and produced them before the court.
The lower court rejected their remand by saying that CrPC procedures like 41-A Notices had not been issued before taking the two into custody. The aggrieved ED preferred to file two separate criminal appeals before the high court and challenged the decision of the trial court.
ED then expressed its concern and asked, “When the two accused were released like this, how can ED investigate the case further?”
As per the case, Srinivasa Rao was involved in the mishandling of funds allotted for execution of a 4-laning project for NH-33 from Ranchi to Jamshedpur. The advances that were given by the lending banks in the execution of the project involved Rs 1,655 crore. Srihari Babu has been charged with swindling public money of Rs 211 crore in the IMS-ESI scam.
Agreeing with the ED argument, the judge said ED functions under a special law called the prevention of money laundering Act (PMLA). ED court had no power to return the remand applications filed by the ED, the judge ruled.
It said, “Even if the ED court has come to a conclusion that Section 41-A of the CrPC was not complied with, it was incumbent on it to pass a reasoned judicial order by rejecting the remand application. The designated court could not have let off the accused against whom serious allegations of money laundering existed, by simply returning the remand application and not passing a reasoned judicial order.”
The designated court has committed a grave error by returning the applications filed by ED under Section 167(2) of CrPC, Justice Lakshman observed.
