TELANGANA: Formula E Scandal: Illegal Payments Exposed in Investigation
The Anti-Corruption Bureau’s probe into the Formula E races in Hyderabad has uncovered a web of procedural lapses that could redefine accountability in public event funding.
With Governor Jishnu Dev Varma’s recent nod on November 20, 2025, to prosecute key figures, the case edges closer to courtroom battles.
As investigators compile evidence from months of scrutiny, the spotlight intensifies on decisions that blurred lines between ambition and oversight.
Registered in December 2024, the FIR targets Bharat Rashtra Samithi leader K.T. Rama Rao (KTR) as the primary accused, alongside former Special Chief Secretary Arvind Kumar and ex-HMDA Chief Engineer B.L.N. Reddy.
The bureau’s report, accessed by Eenadu, details irregularities totaling over Rs 55 crore, prompting calls for swift justice in Telangana’s political corridors.
Unapproved Committees Set the Stage
On July 11, 2022, orders established a managing committee led by KTR and executive groups under Arvind Kumar, without clearance from the Finance Department or other bodies.
No records exist of meetings or assigned duties, raising red flags on transparency from the outset.
This hasty setup bypassed standard protocols, leaving a trail of undocumented actions that investigators now view as deliberate shortcuts in organizing the high-profile electric vehicle races.
Flawed Tripartite Agreement
An October 25, 2022, pact between Arvind Kumar, Formula E’s Alberto Longo, and sponsor Chalamalasetty Sunil outlined government roles in providing facilities, with Ace Nxt Gen covering other costs for seasons 9 and 10.
Kumar signed under KTR’s directives, contravening constitutional Articles 166(1) and 299, alongside state business rules and finance codes.
Such executive overreach, probe officials note, exposed public resources to unchecked commitments, fueling the narrative of favoritism in event promotion.
Unauthorized Fund Disbursements
Despite no role in the races, HMDA disbursed Rs 20.99 crore for season 9 management and Rs.30 crore for track construction, while the Urban Forestry Department added Rs.4.28 crore for ancillary costs.
Arvind Kumar greenlit these without Metropolitan Development Authority approval, even post-expenditure.
Under the HMDA Act, funding international sports falls outside permissible uses, turning what was pitched as urban promotion into a legal quagmire.
Missing Records and Audit Evasion
The Urban Development Department, a signatory to the agreement, maintains zero documentation on expenditures, complicating future audits and shielding potential lapses from scrutiny.
Investigators see this as a calculated move to obscure trails and evade accountability.
Key discrepancies include portraying costs as single-race expenses to sidestep cabinet approval, a clear breach of business and finance guidelines.
Tax and Regulatory Breaches
Overseas payments skipped tax deductions and agreement copies, violating RBI norms and incurring an extra Rs.8.07 crore in penalties.
Pressures from BLN Reddy, HMDA CEO Vijayalakshmi, IOB’s Sameer Biswal, and auditor Kailash Kumar Bang contributed to this avoidable fiscal hit.
These oversights not only inflated burdens but also highlighted a rush that prioritized event timelines over fiscal prudence.
Election Code Infraction
With assembly election notifications out on October 9, 2023, the October 30 season 10 agreement approval ignored the model code of conduct, inviting fresh violations amid heightened political sensitivity.
HMDA’s Hidden Toll
KTR’s push for personal acclaim allegedly diverted HMDA resources for seasons 9 and 10, activities beyond the authority’s mandate.
Aided by Kumar and Reddy, these maneuvers inflicted substantial losses, underscoring how prestige projects can strain public coffers.
As the ACB readies its chargesheet, expected imminently post-DoPT clearance for Kumar, the case tests Telangana’s resolve against corruption in glamour events.
From unrecorded pacts to fiscal fumbles, it whispers a cautionary tale on the cost of unchecked power.