Former Andhra Min and TDP MLA K Atchannaidu held for alleged involvement in ESI scam

Anti-Corruption Bureau (ACB) officials allege that government funds worth Rs 150 crore were misused during the previous TDP government.
TDP MLA Kinjarapu Atchannaidu
TDP MLA Kinjarapu Atchannaidu
Written by :

Senior TDP leader and former state Minister for Labour and Employment Kinjarapu Atchannaidu has been detained by Anti-Corruption Bureau (ACB) officials for his connection to alleged corruption in procurement of medical supplies for ESI (Employees State Insurance) hospitals in the state during the previous TDP’s term. Vigilance and Enforcement Department of Andhra Pradesh had unearthed the irregularities worth around Rs 404 crore earlier in February, while ACB officials have now said that government funds worth Rs 150 crore were misused. 

Atchannaidu, who is an MLA, was taken into custody on Friday morning from his constituency Tekkali of Srikakulam district. Dr CK Ramesh Kumar, former director of IMS (Insurance Medical Services), was also detained along with Dr G Vijaya Kumar, who was also IMS Director at the time. Atchannaidu and the other two detained officials will be produced in the ACB court in  Vijayawada on Friday evening.  

An ACB official told the media on Friday that after the Vigilance and Enforcement Department’s inquiry, the government had handed the matter over to the ACB.  “The ACB also investigated and found the scam to be worth nearly Rs 150 crore. Irregularities were found mainly in purchase of lab kits, surgical items, furniture related to the medical directors, and other services through non-rate firms, violating government norms and misusing government funds,” he said. 

In a note issued in February, the Vigilance and Enforcement Department had named Atchannaidu, who was the state Minister for Labour and Employment back in 2016. The note alleged that he had issued orders to the IMS to enter into an MoU with a firm named M/s Tele Health Services Pvt. Ltd, to set up ECG centres at ESI hospitals and dispensaries. As per Atchannaidu’s orders, the MoU was allegedly signed without calling for open tenders, and awarded to M/s Tele Health Services at hiked rates. The note had also alleged that the firm was eventually found to have committed many irregularities while  providing the services as per the MoU. 

At the time, Atchannaidu had denied the allegations, claiming that the decision was made due to the push from the Centre to implement telehealth services in ESI hospitals. Claiming that he was not involved in any corrupt activities, he said, “In a review meeting, it was decided that since tele-health services were already being provided in Telangana, we must follow the same. I wrote a letter asking the Director of IMS to implement tele-health services in Andhra Pradesh as it is being done in Telangana.”

Atchannaidu is from the Kinjarapu family, who hold political clout in Srikakulam district. He is close to former Chief Minister and TDP chief Chandrababu Naidu, who has condemned the arrest. 

“What happened to TDP MLA Atchannaidu? His family members and I have not been able to reach him on the phone. What has this government done to him? Why have they kidnapped him with hundred policemen?”, Naidu tweeted. 

He wrote that it was unclear why he was taken, and he had not been served any notice beforehand.

Irregularities were also allegedly found in the procurement of various medical supplies for ESI hospitals by then directors of the IMS, Dr B Ravi Kumar, Dr CK Ramesh Kumar and Dr G Vijaya Kumar. These officials were allegedly found to have procured medical supplies worth Rs 975.79 crore in the past five years, by violating various guidelines on awarding contracts and showing undue favour to certain firms, who provided the services or products at an much higher rate. 

Elections 2023

No stories found.
The News Minute