ACB books K T Rama Rao for ₹54.88 crore irregularities in Formula-E deal

ACB files FIR against K. T. Rama Rao and others over Formula-E race irregularities, investigation underway.

The Anti-Corruption Bureau (ACB) on Thursday (December 19, 2024) registered an FIR against Bharat Rashtra Samithi (BRS) working president and former minister K. T. Rama Rao over allegations of irregularities in the conduct the Formula-E race held in Hyderabad in February 2023.

Then Special Chief Secretary to Government, Municipal Administration and Urban Development (MA&UD) department Aravind Kumar and then Chief Engineer of Hyderabad Metropolitan Development Authority (HMDA) B.L.N. Reddy were also named in the First Information Report.

The case was filed following a complaint by Principal Secretary to Government, MA&UD department M. Dana Kishore on Wednesday (December 18, 2024). The complainant alleged that a payment of over ₹54.88 crore was made to Formula-E Operations Limited (F.E.O.) and others in “gross violation of established procedures”.

According to the document, a tripartite agreement was signed on October 25, 2022 between UK-based F.E.O., MA&UD department of Telangana government and India-based Ace Nxt Gen Private Limited (sponsor) for conducting Formula-E races for Seasons 9, 10, 11 and 12 in Hyderabad. Under this agreement, the role of the government was limited to building the track for the event and providing other civic amenities.

The first event was conducted on February 11, 2023 and HMDA incurred an expenditure of ₹12 crore, while the fee and other payments were paid by the sponsor.

However, while the tripartite agreement was in force, differences cropped between FEO and the Sponsor, resulting in the latter backing out from the conduct of the racing events for Season 10 and as per the above agreement, part fee payment was overdue by May 2023, the document read. Discussions were held between the senior officials of the MA&UD and F.E.O. representatives about the possibility of the State government taking up the role of the private sponsor and paying the fee, it further said.

The HMDA received two invoices — one on September 25, 2023 for £22,50,000 (₹22.69 crore plus applicable taxes and commission) towards the ‘first instalment’ of Season 10 promoter’s fee and September 29, 2023 for £22,50,000 (₹23.01 crore plus applicable taxes and commission) towards the second instalment of Season 10 promoter’s fee.