A special court in Andhra Pradesh on Wednesday granted custody of former state Labour Minister and sitting Tekkali legislator K Atchannaidu and four others to the Anti-Corruption Bureau (ACB) for a period of three days.
Issuing the orders, the court also dismissed the bail petitions filed by the accused, who have been arrested in connection with a multi-crore scam in the Employeesâ€™ State Insurance (ESI) scheme.
According to reports, Atchannaidu will be questioned at the Guntur Government General Hospital (GGH) where he is undergoing treatment after a surgery.
Nine people have been arrested so far out of the 19 accused identified by the ACB, and investigation officials said that 10 more people will be arrested with regard to the case soon.
The ESI scheme is monitored and implemented by the Director of Insurance Medical Services (DIMS) in Andhra Pradesh. Employees earning a salary of less than Rs 21,000 per month in the industrial and service sectors contribute a share of their salary for the ESI scheme.
The ACB claimed that during the five-year tenure of Telugu Desam Party (TDP) from 2014 to 2019, when Atchannaidu was Labour Minister, there were several irregularities in the procurement of medicines, surgical equipment and furniture for ESI hospitals, ESI diagnostic centres and ESI dispensaries spread across Andhra Pradesh, causing a loss of Rs 155 crore to the state exchequer.
The ACB said that three directors had made DIMS purchases without constituting a drug procurement committee and without calling for open tenders.
The directors have been accused of fabricating quotations for the tenders and paying excess amounts without negotiating rates. They also allegedly purchased drugs and medicines worth Rs 698.36 crore, when the total budget allocation was Rs 293.51 crore.
The ACB further said that some of the staff of the DIMS using their official positions, established benami firms in the name of their family members and got purchase orders for the supply of medicines and drugs.
In total, the ACB said that the scam is worth Rs 988.77 crore. Teams have been formed to arrest the remaining accused in the case.