A CBI court today remanded J Sekar Reddy and his associate K Srinivasulu, from whose premises Income Tax department seized 127 kg gold and over Rs 170 crore in cash, in judicial custody till January 3, 2017.
They were remanded in custody by special judge for CBI cases Vijayalakshmi.
In its FIR, CBI said the case against them was that the two had exchanged Rs 34 crore as new currency out of the total seized amount.
Both had changed the currency within 24 days from the date the demonetisation was announced (November 8), the FIR stated.
Both were charged under IPC sections 409 (criminal breach of trust by public servant, or by banker, merchant or agent), 420 (cheating and dishonestly inducing delivery of property) and 120B (punishment of criminal conspiracy) and under 13(1) and (2) of Prevention of Corruption Act.
The judge also posted to December 23 the bail pleas by Reddy and Srinivasalu and a petition by CBI seeking the two into its custody.
(REOPENS LGM4)
In the bail petitions, Reddy and Srinivasulu submitted that the seized new currency worth Rs 34 crore was collection of hiring charges of the lorries transporting sand from various depots.
They said they had 425 lorries and each lorry gives a revenue of approximately Rs 25,000 to 30,000 per day as its hiring charges based on its trips round the clock.
The petitioners submitted that they are the executive directors of JSR infra and they have been reporting a turnover of more than Rs 125 crore and they have been paying tax on their income and therefore there was nothing unusual for Rs 34 crore business income found in hand.
All income is being reported and tax is paid, they said.
They further submitted that they had not indulged in converting old currency into new currency either through brokers or through any bank officials.
"The money seized by Income Tax officials is the lawful business income. The reports in the newspapers and in the media regarding seizure are not true and not correct," they submitted and sought bail stating that they would co-operate with the investigation and not tamper with evidence.
