Deshpande (57), a former journalist and Tata Steel's former chief of corporate communications, was found hanging at his Vasai home on June 28 last year.
Though, no suicide note was found from the house, his friends and former colleagues alleged that he was harassed by the employees of Tata Steel.
A case was registered at Vasai police station. Vasai police and Mumbai Crime Branch conducted joint investigations into the death, though no breakthrough was achieved.
"The case has now been transferred to the CBI," an official at Home Department said today.
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The release claimed, "Both the family members of Charu (as he was popularly known) as well as the Mumbai Press Club had earlier given separate letters to the Home Minister stating that the investigation into charges of abetment against Tata Steel officers had run aground and were deliberately not being pursued by the Thane Rural Police."
Vasai police station comes in Thane Rural jurisdiction.
In a series of interactions between a Press Club delegation and the Home Minister over Wednesday and Thursday, it was pointed out to the latter that the Thane Rural Police had failed to take Prabhat Sharma, whom the Press Club delegation described as prime suspect, into custody for interrogation.