The Andhra Pradesh Crime Investigation Department (APCID) on September 9, 2023, arrested former Chief Minister and Telugu Desam Party (TDP) national president N. Chandrababu Naidu, who has been named as the prime accused in the alleged fraud involving about ₹371 crore in the A.P. Skill Development Corporation during 2014-19 period when the TDP was in power, said CID Additional DG N. Sanjay.
Mr. Naidu would be produced in the CID court in Vijayawada later in the day.
At a press conference at the A.P. Police Headquarters in the district a few hours after the arrest, he said the CID police served notices to Mr. Naidu at 6 a.m. at RK Function Hall in Nandyal and subsequently arrested him.
The case related to establishment of clusters of centres of excellence in Andhra Pradesh. The total estimated project cost was ₹3,300 crore and misappropriation happened to the tune of ₹371 crore, Mr. Sanjay said.
The arrangement was that 90% of the project cost would be invested by Siemens India Software India Pvt. Ltd. with 10% contribution by the Andhra Pradesh government, as per a Memorandum of Understanding inked by the government. The State government released ₹371 crore, and a large part of it was siphoned off, Mr. Sanjay said, adding the money was diverted to shell companies through fake invoices.
No actual delivery or sale of items could be found during the investigation, which indicated that the prime accused Mr. Naidu and other TDP leaders were the beneficiaries of the misappropriated funds, Mr. Sanjay said.
The investigation, which began with the questioning of the then head of the Skill Development Corporation and the persons related to the shell companies who were among the accused, revealed that the transfer of funds from the government to private companies via shell companies happened with the active involvement of Mr. Naidu, he said.
‘’Mr. Naidu possesses exclusive knowledge of the transactions leading to the issuance of the government orders, and the signing of Memorandums of Understanding from time to time, which makes him the central figure of the entire investigation,” he said.
The ultimate use of the misappropriated funds, including cash holdings with certain individuals like Vikas Vinayak Khanwilkar of Designtech Systems Pvt. Ltd. required further investigation. Key documents related to the case had gone missing, which could implicate Mr. Naidu and other prime suspects in this regard, he said.
‘’The further investigation primarily focuses on locating the misappropriated funds, hence the custodial interrogation of Mr. Naidu, in this regard, is necessary. As he holds a very important position as the head of a political party and also being a former Chief Minister, there is every chance of him influencing the course of investigation. Therefore, his arrest became necessary,” Mr. Sanjay said.
The material, including the statements of public officials under Section 164 Cr.P.C., clearly pointed to the involvement of Mr. Naidu, as the principal decision maker, in the release of money in advance by the government. The charges in the case could result in imprisonment for more than 10 years, the ADG added.
The role of others involved in the case, including Nara Lokesh, son of Mr. Naidu, required further investigation.
The Enforcement Directorate (ED) and GST, the central agencies, had already investigated the case. All the relevant material evidence would be produced in the court. The entire offence occurred with the knowledge of the prime conspirator and final beneficiary of this money, he said.