Formula-E Case: Telangana Anti-Corruption Bureau Submits Report

In a latest development in the Formula-E race case, the Telangana Anti-Corruption Bureau (ACB) submitted its investigation report to the state government on September 9, 2025, after a nine-month probe.

The Bureau has reportedly discovered evidence linking the political party Bharat Rashtra Samithi (BRS) to INR 40 crore in electoral bonds received from Formula E sponsors in a quid pro quo arrangement. It has sought government approval to prosecute former minister, BRS working president, and Sircilla MLA K.T. Rama Rao, along with other accused.

Background

Initially, a tripartite agreement dated October 25, 2022, was entered into between Formula E Operations Ltd. (FEO), the Municipal Administration and Urban Development (MAUD) department, Government of Telangana and Ace Nxt Gen Private Ltd. (ACE). As per this agreement, Hyderabad was set to host four events, one each for Seasons 9 through 12. It was agreed that ACE would be the promoter of the event and would be obligated to make payments to FEO. The MAUD department was to act as a host and provide all the civic amenities.

Though Season 9 of the championship took place as scheduled, it is said that ACE backed out as the race promoter for later editions. It is claimed that Rao sought to get the state government to act as a promoter/host and then approved the draft agreement in which Hyderabad Metropolitan Development Authority (HMDA) was designated as the promoter, and sanctioned sizable payments.

Pursuant to his approval, HMDA remitted money in instalments on October 3, 2023, and October 11, 2023. Subsequently, FEO addressed an email terminating the initial tripartite agreement. A new agreement dated October 30, 2023, was entered into between FEO and the MAUD department to conduct race events in Hyderabad for Seasons 10 to 12.

The allegations include:

• The Model Code of Conduct was in operation owing to the State assembly elections, and therefore, the new agreement could not have been entered into.
• HMDA was made to pay huge sums of money even before the new agreement was entered into, and despite not being a party to the agreement.
• The foreign remittances caused HMDA an additional tax burden of INR 8 crore.
• Though HMDA could not spend more than INR 10 crore without obtaining administrative sanction from the government and the finance department, the direction to make payments to FEO, which came down to INR 54.88 crore, was made without obtaining the necessary sanctions.
• The new agreement made a financial commitment of INR 600 crore along with additional recurring expenditure for the next three years, in violation of the Secretariat Business Rules, the Telangana State Finance Code and Article 299 of the Constitution of India. It is asserted that both agreements were executed without any sanction from the Governor authorising the then Special Chief Secretary.

The new government formed post the assembly elections is said to have noticed the irregularities after it was served with an arbitration notice by FEO alleging breach of agreement.

Based on a complaint, the ACB registered an FIR against Rao and other accused for offences under provisions of the Indian Penal Code, 1860, and the Prevention of Corruption Act, 1988.

Plea to Quash Criminal Proceedings Rejected

In January this year, the Telangana High Court observed that the allegations, when read together, made out a prima facie case of wrongdoing and misappropriation of HMDA’s funds, and refused to quash the FIR against Rao.[1] Rao later approached the Supreme Court via a special leave petition (bearing no. SLP(Crl) 422/2025), but he withdrew the petition after the Court expressed reservations about entertaining it.

When Will Formula E Return to India?

While it remains unclear when a return might be possible, the outcome of the ongoing case could certainly influence it. Formula E CEO Jeff Dodds had earlier called for a quick and fair resolution to enhance the prospects of a return to India.

[1] Kalvakuntla Taraka Rama Rao v. The State ACB, CIU, Hyderabad and Anr. (CRLP 15847/2024).