Five persons accused of causing losses to the government through corruption in a deal for supply of parts of battle tanks were denied bail by the Special CBI court in Kochi on Saturday.

V.K. Panda, general manager of the Defence Ministry’s Ordnance Factory at Medak near Hyderabad; S. Shanavas, managing director of Steel and Industrial Forgings Ltd. (SIFL); A. Valsan, senior manager of SIFL; Muralidhar Bhagvat, former managing director of AMW-MGM Forgings in Mysore; and K.R. Mugilan, a manager in the same company; were arrested by the CBI on Wednesday.

The court denied bail to the accused as the investigation is still at a crucial stage.

Conspiracy to form cartel

According to the CBI, officials of SIFL and AMW-MGM conspired to form a cartel and quote higher prices for road wheel arms, thus causing losses to the government.

The CBI said a note issued under Mr. Panda’s directions disqualified the lowest quote during the first bidding. He then allegedly passed on commercially sensitive information to defence consultant Subi Mally, an accused in the case.

The investigating agency said Ms. Mally, along with officials of SIFL and AMW-MGM,conspired to form a cartel and hike prices.

The CBI is yet to name the prime accused in the case.

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