Jharkhand High Court on Thursday rejected the bail petition of Rashtriya Janta Dal leader Lalu Prasad who was sentenced to five years in jail by a special CBI court for his role in the Chaibasa treasury case in the Rs. 950-crore fodder scam.

Mr. Prasad has been in Birsa Munda jail in Hotwar, Ranchi since last four weeks.

On Wednesday , Justice R.R. Prasad had reserved his order for Thursday after hearing the arguments.

Mr. Prasad’s lawyer Surendra Singh argued that Mr. Prasad had no knowledge of withdrawal of Rs. 37.6 crore from the Chaibasa treasury in West Singhbhum district and that he had ordered a case registered in February 1996 when he came to know of the matter.

CBI lawyer Mukhtar Khan argued that Mr. Prasad had known of the fraudulent withdrawal since 1990 but took no action and resorted to forming Public Accounts Committees who were in collusion with him instead of seeking a police investigation into the matter.

Mr. Khan cited instances from 1990 when Ramjeevan Singh, the then minister in Mr. Prasad’s government, had proposed a CBI enquiry into fraudulent withdrawals from Chaibasa, Deoghar and Ranchi treasuries and between 1993 and 1994 when the matter was brought to Mr. Prasad’s notice by officials but no FIR was registered till February 1996 when two district officials registered a case against district officials suspected of committing irregularities.

The High Court on October 25 gave two months provisional bail to the former Bihar Chief Minister, Jagannath Mishra, who is one of 45 accused sentenced in the Chaibasa court by the CBI court, on medical grounds.

The court will hear the bail petition of the former MP, Jagdish Sharma, on November 22.