Formula E case: KTR among five charged

THe anti-corruption bureau (ACB) of Telangana police force on mon filed a bill sheet of paper in the special margaret court for cases in connection with the alleged misappropriation of funds related to the Formula E race held in Hyderabad in 2023, people familiar with the matter said.According to the charge sheet, Bharat Rashtra Samithi (BRS) working president and former minister K T Rama Rao is named as the primary accused along with senior IAS officer Arvind Kumar, former Hyderabad Metropolitan Development Authority (HMDA) chief engineer B L N Reddy, sports consultant Kiran Malleswar Rao and UK-based Formula E Operations (FEO) as other accused.“The ACB has completed the investigation and submitted its charge sheet in the Formula E race case. It is for the ACB court to take cognisance of the charge sheet and conduct a comprehensive trial,” a senior police official privy to the matter said.On December 19, 2024, the ACB registered an FIR under sections of the Prevention of Corruption Act, besides Section 409 (criminal breach of trust) and 120-B (criminal conspiracy) of the Indian Penal Code (IPC), for the alleged financial irregularities of ₹54.88 crore in conducting the Formula E racing in Hyderabad.The FIR, which HT saw, stated that during the previous BRS government, a tripartite agreement was signed on October 25, 2022, between Formula E Operations (UK), Ace Nxt Gen (a subsidiary of Greenko Group) and the municipal administration and urban development (MA&UD) department, to conduct Formula E races for Seasons 9, 10, 11 and 12 in Hyderabad.As per the agreement, the state government would build the track for the event and provide other civic amenities. The Season 9 of the Formula E race was conducted on February 11, 2023.Meanwhile, the sponsor, Ace Nxt Gen, backed out from conducting the racing event for Season 10 due to some differences with the FEO. As per the agreement, part of the fee payment was overdue to FEO by May 2023.Following discussions between the FEO representatives and the MAUD authorities on September 27, 2023, it was decided to make HMDA as the promoter and host of the event and pay the fee.As per the discussions with the FEO, the HMDA was supposed to release ₹160 crore, including a ₹110 crore payment to the FEO. “The file was signed by KTR, who was then minister for MAUD,” the FIR said.It stated that although foreign remittances were made, no formal approvals of the relevant regulatory authorities were obtained before transferring the huge amounts. The foreign remittances resulted in an additional tax burden of ₹8.06 crore to the HMDA.The HMDA had also released ₹1.10 crore to the Federation of Motor Sports Clubs of India towards FIA inscription, interstate championship calendar fee and permit fee. “The total amount thus far paid by the HMDA was ₹54.88 crore from its general funds,” the FIR said.As per the rules, the HMDA must take administrative approval from the state government for any expenditure exceeding ₹10 crore.The government grants such sanction in concurrence with the Finance Department. “In this case, no such procedure was followed,” the FIR said.The ACB authorities noted that the payments to the FEO were made much before the new agreement was signed with the government as the promoter and host on October 30.Under this new agreement, the state government took the responsibility of not only paying the sponsor fee of ₹90 crore but also the burden of providing civic and logistic support in the form of laying the track for the event etc. “The new agreement with the FEO was signed while the MCC was in force and no prior approval from the Election Commission of India was obtained by HMDA for making the payments during the relevant period,” the FIR said.