The Enforcement Directorate (ED) has alleged that suspended Karnataka Public Service Commission (KPSC) chairman Shivashankarappa Sahukar was planning a ₹35-crore complex in his hometown of Shahpur in Yadgir district, comprising a school, hostel, playground, shopping mall and convention hall.

The agency made the submission during bail hearings for Sahukar and KPSC member B V Geetha before a special court. Arguments from both sides concluded on Monday, with the court reserving its verdict.

According to the ED, architectural plans had been prepared for the proposed project on land owned by Sahukar’s wife. The agency also pointed out that a parent of a candidate allegedly involved in paying a bribe for leaked answer keys in the January veterinary doctors’ examination had been designated as the caretaker of the proposed school.

The allegations form part of the ongoing investigation into irregularities in KPSC recruitment examinations, including the alleged leaking of question papers and answer keys in exchange for bribes.

Alleged Cash-For-Jobs Racket

Sahukar and Geetha are accused of leaking answer keys to nine candidates who appeared for the January 9 veterinary officers’ examination. The alleged bribes ranged between ₹10 lakh and ₹40 lakh.

The ED told the court that Sahukar received ₹10 lakh from the parent of a candidate who secured the third rank, as part of an alleged ₹20-lakh deal. Geetha allegedly received ₹20 lakh from the first-ranked candidate as part of a ₹40-lakh arrangement on the eve of the examination.

The agency also spotlighted cash transactions exceeding ₹10 crore between Sahukar and real estate businessman S P Dayanand. This included ₹4.99 crore transferred between August and December 2025.

During searches at Sahukar’s residence between August 18 and 24, investigators reportedly recovered a notebook and loose sheets containing details of examination candidates and cash dealings.

The ED alleged that substantial cash transactions between Sahukar and Dayanand took place outside the banking system, with the agency claiming that the dealings involved approximately ₹10 crore and occurred at Sahukar’s residence.

ED Opposes Bail Pleas

During the bail hearing, Sahukar’s defence counsel, C H Hanumantharaya, argued that his client qualified for bail under the Prevention of Money Laundering Act (PMLA), as he was not accused of personally receiving more than ₹1 crore in proceeds of crime.

However, ED counsel Maheshwari D M argued that the statutory threshold could only be determined after the filing of the prosecution complaint. The agency maintained that the alleged proceeds of crime could not be restricted to transactions involving an individual candidate but had to be examined in the context of the wider corruption allegations surrounding KPSC recruitment.

Geetha’s defence counsel sought special consideration under the PMLA on the grounds that she was a woman. The ED opposed the request, arguing that she was not a scapegoat and was fully aware of her actions. The agency also pointed out that Geetha was a non-practising advocate who had previously served as a prosecutor for the Karnataka Lokayukta.

Karnataka High Court Orders Fresh SIT

The investigation has also seen a fresh development, with the Karnataka High Court ordering the reconstitution of the Special Investigation Team (SIT) probing recruitment irregularities in KPSC.

The court directed Additional Director General of Police R Hitendra to lead the reconstituted team and instructed that the SIT investigation should complement the parallel probe being conducted by the ED.

The Karnataka Criminal Investigation Department (CID) and the ED have implicated Sahukar, Geetha and examination controller Gyanendra Kumar Gangwar, an IAS officer, in the alleged leaking of examination questions and answer keys to around 20 aspirants.

The CID is expected to file its chargesheet by November 26.

The case has brought renewed scrutiny to recruitment procedures within KPSC, with investigators examining allegations of cash-for-jobs deals, examination paper leaks and irregularities in the selection process. The investigations are continuing, and the allegations against the accused are yet to be established in court.