Chennai industrialist Sekar Reddy was arrested on Wednesday by the Central Bureau of Investigation (CBI) over an IT raid in which Rs 154 crore in cash and 177 kg gold were seized. It comes a day after the Enforcement Directorate registered a case against Reddy and his business partner under the Prevention of Money Laundering Act (PMLA).
Reddy has been sent to CBI custody till January 3, 2017.
The CBI had questioned Reddy on Tuesday over possession of unaccounted money following which he was detained before the agency officials formally arrested him on Wednesday, the Times of India reported.
The industrialist was produced before a CBI special court and as per the court's order, was taken to the Government General Hospital for medical check-up.
Reddy, who is believed to be close to All India Anna Dravida Munnetra Kazhagam (AIADMK), also allegedly has close links with the son of Tamil Nadu Chief Secretary P Rama Mohana Rao, whose residence and office in Chennai were raided by the IT Department on Wednesday.
Reddy's residences and businesses were also raided by the IT Department this month. The three-day raid led to the recovery of Rs 154 crore in cash, including Rs 34 crore in new Rs 2,000 denomination notes, and more than 167 kg of gold.
The CBI and the ED had also joined the raids after the recovery of the huge amount of cash and gold. Reddy and his associate Srinivasa Reddy, along with their agent Prem, were interrogated by the IT Department over the matter.
Reddy, who is a member of the Tirumala Tirupati Devasthanams (TTD) board, was said to be closely linked to the AIADMK as well as Tamil Nadu Chief Minister O Panneerselvam.