CBI court grants conditional bail to J Shekar Reddy, his associates

Chennai: A special CBI court on Friday granted conditional bail to businessman J Shekar Reddy and his two associates, arrested after discovery of over Rs 170 crore by I-T Department post demonetisation last year.

Special Judge Venkatasamy asked the three to deposit Rs 5 lakh each with one surety of the like amount, surrender their passports and appear before the investigating officer daily at 10.30 am till further orders.

The judge said despite lapse of several days after the seizure of the money, the investigating agency was unable to arrest even a single bank official for the alleged fraud.

"Hence it would leave the court to believe the defence argument that the seized money came from the legitimate business transactions," the judge said.

The trio have been accused of depositing or exchanging several crores of demonetised currencies illegally with the connivance of bank officials within a few days after demonetisation was announced on November 8 last year.

The three were arrested in last December and the CBI had registered a case of criminal conspiracy and cheating under IPC besides various provisions of the Prevention of Corruption Act against Reddy and his associates Srinivasulu and Premkumar for alleged conversion of currency in violation of the RBI norms.

The CBI had seized Rs 170 crore, including new Rs 2000 currency notes besides more than 170 kilo of gold after searching several premises of Reddy and his associates.