The anti-corruption wing of the state police Wednesday arrested Odisha Jana Morcha (OJM) secretary general Jagneswar Babu on corruption charges, an official said.
Superintendent of Police (Vigilance Cell) S.B. Mishra said the arrest was made on the basis of Babu's alleged role in the disbursement of a loan of over Rs.36 crore in 2009 from state-run Odisha State Cooperative Bank (OSCB), when he was its president.
The bank disbursed the loan to Bijayananda Cooperative Sugar Mill at Deogaon in the district of Bolangir, about 350 km from state capital Bhubaneswar.
Babu was also the president of this mill at the time of the disbursement, the police officer said.
The disbursement was made in violation of stipulated guidelines laid down by the National Bank for Agriculture and Rural Development (NABARD), Mishra said.
Refuting the allegations, Babu said the arrest was politically motivated. A NABARD team had examined the matter and had never found any irregularities, he added.
Chief Minister Naveen Patnaik and the state government "have been trying to implicate me and other leaders on false charge since the day we joined Odisha Jana Morcha (OJM)", he alleged.
The OJM was first launched as a political forum by Pyari Mohan Mohapatra, a Rajya Sabha member, Oct 1, 2012. The launch of the outfit occurred after Mohapatra was expelled from the ruling Biju Janata Dal.
Early this month, Mohapatra converted his new outfit into a political party.
Both Mohapatra and Babu were earlier close to Naveen Patnaik, and were expelled from the party after they allegedly plotted a coup to unseat the chief minister.
The alleged attempt tiotople Patnaik May 29 last year forced him to cut short his official visit to Britain and return home.
