Bengaluru, 6 June

Deputy Chief Minister DK Shivakumar on Thursday said Minister B Nagendra has offered to resign, following allegations against him in connection with an illegal money transfer case, and indicated that he may quit the Siddaramaiah Cabinet later in the day.

Seeking to mount pressure on the Congress government, the opposition BJP staged a protest march from 'Vidhana Soudha' to Raj Bhavan and petitioned Governor Thaawarchand Gehlot demanding the Scheduled Tribes Welfare Minister's resignation over what it called a "big corruption scam".

Shivakumar said: "There is no need for anyone demanding (resignation), we -- myself, Chief Minister and Home MInister-- have discussed with the Minister (Nagendra). The Minister has assured that he is not involved in anything, but in the interest of the party and the government, he doesn't want to embarrass the party, he himself has offered to resign from the Ministership. I think today he will do that job (resign)."

"The Chief Minister after discussing with the Congress high command, will take a call," he said. Chief Minister Siddaramaiah earlier on Thursday said he will take a decision on seeking resignation of Nagendra, after talking to the Special Investigation Team (SIT) formed to probe the multi-crore scam, and discussing with senior Cabinet colleagues.

The illegal money transfer issue, involving Karnataka Maharshi Valmiki Scheduled Tribes Development Corporation Ltd, came to light, after its accounts superintendent, Chandrashekhar P, died by suicide on May 26, leaving behind a death note.

The note revealed the unauthorised transfer of Rs 187 crore belonging to the state-run Corporation -- which comes under the administrative control of Nagendra's department -- from its bank account, and from that, Rs 88.62 crore was illegally moved to various accounts allegedly belonging to "well-known" IT companies and a Hyderabad-based cooperative bank.

Chandrashekhar has named the Corporation's now-suspended Managing Director J G Padmanabh, accounts officer Parashuram G Durugannavar, and Union Bank of India Chief Manager Suchismita Rawal in the note, while also stating that the "Minister" had issued oral orders for transferring the funds.

Siddaramaiah and Shivakumar, who is also the state Congress President, are said to have held a meeting after news broke about the CBI filing an FIR based on a complaint filed by the Union Bank of India, sources said. They reportedly summoned Nagendra and explained the circumstances and asked him to step down, and also assured him that he would be reinstated if his name was cleared from the charges.

Mumbai-headquartered Union Bank of India last week filed a formal complaint with the CBI in connection with embezzlement of money belonging to the Corporation involving its MG Road branch. It had also suspended three officials.

The Corporation had filed an FIR against top Union Bank of India officials with the police, over embezzlement of Rs 88 crore. The CBI has taken up a probe into the case, Home Minister G Parameshwara said on Wednesday, while adding that the Cabinet will take a call on handing over to the CBI investigation covering the state government departments linked to the case, once it gets a formal request from the central agency.

The state government last week constituted an SIT headed by Manish Kharbikar, Additional Director General of Police, Economic Offences, at the Criminal Investigation Department (CID) here, to conduct the probe.

A delegation of BJP leaders led by its state President BY Vijayendra and Leader of Opposition in the Assembly, R Ashoka that petitioned the Governor, urged him to seek the Chief Minister's and Nagendra's resignation.

"A big corruption scam has happened in the state, where the money kept for the development of ST community has been illegally transferred to more than eighteen fake bank accounts in Hyderabad, this cannot happen without the approval of the Finance department," Vijayendra said.

"The Chief Minister also holds the charge of the Finance Department, and such a big scam would not have happened without it coming to his notice, just the Minister's resignation will not do justice, the Chief Minister is also responsible, and his resignation should also be sought," he said.