Rao, who was the First Additional Special Judge for CBI cases here had granted conditional bail on May 11 to the mining baron while rejecting the bail to suspended IAS officer Y Srilakshmi, another accused in the OMC case.
Following CBI's appeal expressing apprehensions that Reddy could influence and threaten the witnesses and tamper with the evidences, the High Court on May 23 had cancelled Reddy's bail.
The high court on May 31 suspended Rao amid allegations of illegal gratification and corruption against him. The judge was accused of granting bail to Reddy for a bribe.
While setting aside the bail orders issued by Rao, the high court today said that Reddy has the liberty to approach the lower court (special CBI court) again to seek bail.
On a tip off that a deal has been struck between Reddy and the judge, the central agency recovered a cash of nearly Rs 1. 80 crore from a bank locker here, the keys of which were allegedly in possession of Rao's son.
The matter was subsequently referred to the state Anti-Corruption Bureau (ACB) which on Saturday last registered a case against Rao and seven others under relevant sections of Indian Penal Code (IPC) and the Prevention of Corruption Act.
