This Article is From Jan 30, 2012

Andhra Pradesh's Home Secretary arrested in Emaar scandal; CBI gets custody till Feb 1

Andhra Pradesh's Home Secretary arrested in Emaar scandal; CBI gets custody till Feb 1
Hyderabad: One of Andhra Pradesh's most senior bureaucrats, IAS officer BP Acharya, has been arrested in Hyderabad on charges of criminal conspiracy, cheating and corruption. Mr Acharya is the Principal Home Secretary.

The case involves Emaar Properties, a real estate giant headquartered in Dubai, which was planning to build a high-end hotel, golf course and luxury villas on 535 acres in Gachibawli. (Read: Five big facts on Andhra Pradesh's Emaar case)

The township was to be built as a joint venture with the Andhra Pradesh Industrial Infrastructure Corporation (APIIC) which was forged when Mr Acharya was the Vice Chairman and Managing Director of the APIIC. The agreement was later revised, reducing the share of the APIIC, and the decision was approved by its board instead of the cabinet. Emaar-MGF is said to have benefitted by upto 2500 crore rupees. APIIC says the developer has cheated it of crores of profit by siphoning money to Dubai.

The villas, which were bought by politicians, film stars and A-list entrepreneurs were reportedly under-valued in documents, costing the government thousands of crores. Land was reportedly sold at Rs 6,000 per square yard when the market rate was at least Rs 60, 000 per square yard.

Mr Acharya is the fourth person arrested so far for this case; he will remain in the CBI's custody till February 1. In recent days, an industrialist named Koneru Prasad and Sunil Reddy, who is a close aide of politician Jagan Mohan Reddy, have also been jailed. Also arrested on Saturday was Vijay Raghavan, south India finance head of Emaar-MGF.

Jagan's father, YSR, was Chief Minister when the state's controversial partnership with Emaar was forged. YSR died in 2009 in a helicopter crash. It is alleged that people who benefitted from the land deal had invested in Sakshi publications, which is Jagan's newspaper. Those close to Jagan claim the case exemplifies political vendetta. They believe the Congress government is using it to undermine the popularity that Jagan enjoys among voters who swear allegiance to his father even today.  Jagan's mother, YS Vijayamma, has written today to the Prime Minister formally complaining that the CBI is being misused against her son. (Read the letter)

The CBI's investigation has focused heavily on the role of Congress MP KVP Ramachandra Rao, who was known to be close to YSR.  Mr Rao's wife bought one of the plots in the controversial township; his brother-in-law, Parthasarathi, was a director of APIIC and has also been named in the FIR filed by the CBI.

The CBI probe in to the case was ordered on August 10 last year by the Andhra Pradesh High Court.