Telangana's Anti-Corruption Bureau (ACB) filed a case on Thursday against K T Rama Rao (KTR), the working president of Bharat Rashtra Samithi (BRS) and son of former Chief Minister K Chandrashekar Rao, over alleged irregularities in bringing the Formula E car racing event to Hyderabad in February last year. 

KTR is the main accused, while former Municipal Administration and Urban Development (MAUD) principal secretary Arvind Kumar and former Hyderabad Metropolitan Development Authority (HMDA) chief engineer BLN Reddy are also named in the case. The issue concerns alleged financial misconduct and payments made during KTR's tenure as the state's minister for MAUD, which was responsible for bringing the Formula E event to the nation's capital. According to the FIR, KTR authorised Arvind Kumar to make payments without first obtaining Cabinet approval.

The ACB claimed that HMDA paid Rs 45 crore in two parts to the foreign company, Formula E Organisers (FOE), which went against RBI rules. As a result, the RBI fined the Telangana government Rs 8 crore for unauthorised transactions. This fine was later paid by the Congress government after it took power late last year. The FIR states that when the new government looked into why the RBI had imposed the fine, they found financial irregularities and violations related to the Formula E race event. This led the ACB to start its investigation. In addition to IPC sections 409 (criminal breach of trust) and 120B (criminal conspiracy), the FIR was filed under the Prevention of Corruption Act. The case was launched following Governor Jishnu Dev Varma's approval to bring charges against KTR.  

In a letter to Chief Minister A Revanth Reddy on Wednesday, KTR stated that the Legislative Assembly ought to hear the Formula E issue in order to inform the Telangana populace of what "actually happened." CM Revanth Reddy and a number of Congress government ministers accused the race's organisers of corruption after taking office in December 2023. “One main allegation is that K T Rama Rao did not seek the necessary approvals from the Cabinet. The money was transferred to accounts of individuals and entities, including one foreign firm, not connected with organising the race. Telangana Assembly elections had been announced and the Model Code of Conduct was in force and the second agreement made to hold the race was done without permission of the Election Commission,” said an official.

KTR denied any wrongdoing in the payments for the event, stating that the decision to host the race was made to promote Hyderabad’s image globally. In late 2022, the Municipal Administration signed an agreement with FEO and Ace Nxt Gen Pvt Limited to host Formula E seasons 9, 10, 11, and 12. The ninth season took place in Hyderabad on February 10 and 11, 2023. According to the ACB, Ace Nxt Gen dropped out after season nine, but FEO was still willing to continue with season 10. As a result, Arvind Kumar approved transfers of Rs 45 crore, made in Pounds, to FEO. 

The FIR mentions that when the Congress government asked Arvind Kumar why the RBI fined him and why Rs 45 crore was paid, he explained that he transferred the money in two parts after getting approval from the competent authority, which was the then MAUD minister, KTR. In response to the FIR, senior BRS leader and former minister T Harish Rao said KTR is being targeted for his efforts to improve Hyderabad's global image. Regarding these claims, KTR has previously said that no unlawful agreements were made in order to hold the races. “I am willing to go to jail if anything illegal is found. I will use the jail time to stay fit and plan a padayatra,” he said.

KTR explained that the BRS government of Telangana persuaded sponsors to host the race in Hyderabad, competing with cities like Seoul and Cape Town. He mentioned that a tripartite agreement was made between the state government, Greenko, and Ace Nxt Gen for the ninth season. However, Ace Nxt Gen pulled out for the next season, citing losses. When KTR learned about this, he directed the HMDA commissioner, Kumar, to transfer funds to the organisers while they looked for new sponsors. “I gave the instructions as vice-president of HMDA. The HMDA operates independently and does not need approval from the Finance Department or Cabinet,” he said.