In a major jolt to Ramoji Rao and Margadarsi, the Supreme Court on Friday (Feb 2, 2024) declined to transfer the criminal appeal pending against Margadarsi Chit Fund Private Limited (MCFPL) from the Andhra Pradesh High Court to the Telangana High Court.

During the hearing, Justices Abhay S Oka and Ujjal Bhuyan queried the petitioner's counsel about the rationale behind transferring a case from Andhra Pradesh to Telangana. Senior Counsel Siddharth Luthra, representing the Chit Fund Company, argued that the transfer was necessary as the cause of action for registering cases originated in Telangana. However, the AP Government argued that Margadarshi Chitfunds had committed crimes within Andhra Pradesh and opposed the transfer of cases to Telangana.

With an annual turnover of Rs. 3,274 crores in AP, the CID police are actively investigating these cases. Citing the Chit Funds Act, the government asserted that judicial inquiries should be conducted within Andhra Pradesh, as it is the native place of 150 witnesses involved in the cases.

The AP CID conducted raids on Margadarshi, registering cases against Chitfund Chairman Ramoji Rao and MD Sailajakiran. The true nature of the company and activities behind its subsidiaries came under scrutiny, raising questions about hidden records and compliance with regulations.

Accusations against Ramoji included illegalities under the cover of his numerous companies, diversion of chit fund users' amounts against rules, and acquiring land for Ramoji Film City through questionable means. Recent complaints, including one from G Jagannath Reddy's son, Yuri Reddy, alleged that Ramoji Rao forcibly obtained guide shares from their family under threat.

The Supreme Court's rejection of the plea marked a significant development in the ongoing legal battles surrounding Margadarshi Chitfunds, with the AP Government asserting its jurisdiction and investigations revealing alleged financial irregularities and misuse of power.

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