NEW DELHI: A corruption case that saw Andhra Pradesh Chief Minister N Chandrababu Naidu arrested and lodged in judicial custody for over seven weeks in 2023 is now set to be formally closed, with the state Crime Investigation Department (CID) concluding that the case itself was registered due to a “mistake of fact”.
According to a statutory Form-70 notice issued under Section 173(2)(ii) of the Criminal Procedure Code a copy of which has been accessed by this newspaper, the CID has informed the complainant that it does not intend to proceed further in the Andhra Pradesh State Skill Development Corporation (APSSDC) case, widely referred to as the skill development or Siemens skill case.
The notice, dated 19 December, was issued by the Deputy Superintendent of Police, Economic Offences Wing-II, CID, Mangalagiri, and placed before the Special Court for SPE and ACB cases in Vijayawada. The notice was served on Nallaparaju Bangara Raju, the then Managing Director of APSSDC and the formal complainant in the case, stating that the final report classified the matter as a “mistake of fact” and that no charges were proposed. Under criminal procedure, the complainant has the right to file a protest petition within one week of receiving such a notice. Bangara Raju did not file any objection within the stipulated period, legal sources said, making acceptance of the closure report by the court likely.
The case related to alleged irregularities in a flagship skill development programme implemented during Naidu’s earlier tenure as chief minister between 2014 and 2019. Naidu, who was then Leader of the Opposition, was arrested on 9 September 2023, months ahead of the 2024 Assembly elections, and remained in judicial custody for more than seven weeks before being granted bail by the Andhra Pradesh High Court. The investigation did not progress to the trial stage.
The allegations centred on a skill development project implemented by APSSDC between 2014 and 2018 in partnership with Siemens Industry Software (India) Pvt Ltd and Designtech Systems Pvt Ltd. The project was projected at around Rs 3,300 crore, of which the state government’s direct cash contribution was approximately Rs 330 crore, while the remaining value was projected as in-kind support, including software licences, training modules, equipment and technical expertise from the private partners.
During the YSR Congress Party (YSRCP) government, the CID’s Special Investigation Team alleged that the valuation of this in-kind contribution was inflated and that government funds were misused through layered transactions and bogus invoices. The private partners denied wrongdoing. The CID has now taken the position that the allegations were based on incorrect factual assumptions and did not disclose a criminal offence.
In an October 2024 press release, the Enforcement Directorate named several private individuals and firms linked to the skill development project, accusing them of cheating the government and siphoning off funds through multi-layered transactions. The ED statement, however, did not name Naidu, who had by then returned as chief minister.
The YSRCP has criticised the CID’s move to close the case, alleging a reversal in the agency’s stand. In a statement, the party said the CID’s own Special Investigation Team had earlier established corruption in the Siemens skill development project and accused the agency of diluting its findings under pressure to protect Naidu. The CID has not publicly responded to these allegations.
It remains unclear whether the CID intends to extend the closure to all accused named earlier or restrict it to Naidu alone. The skill development matter is the second major corruption case against Naidu to be closed this month. Earlier, Special Court Judge Bhaskara Rao closed another case relating to alleged irregularities in the grant of permissions to distilleries between 2014 and 2019, after the CID reported that it could find no evidence against him. That case had earlier carried allegations of a notional loss of around Rs 1,000 crore to the exchequer.
Both cases were registered during the previous regime and related to decisions taken during Naidu’s earlier term as chief minister. With the CID now formally retracting its own allegations through court mandated procedure, the criminal proceedings initiated against the Telugu Desam Party chief ahead of the 2024 elections are nearing their legal end.
