New Delhi: Following the findings of a central team led by B K Sinha, Secretary, Rural Development in Latehar district of Jharkhand, the Union government has decided to hold a CBI inquiry into the bungling of funds under Mahatma Gandhi National Rural Guarantee Scheme (MNREGS) in the state.

The probe team in its report revealed the contractor-administration nexus in embezzling funds of MNREGS and murder of social activists for protesting the loot of public money.

The panel slammed Jharkhand Chief Secretary and the state administration for washing off its hands from the targeted killings of social activists and blaming  Maoists as a ploy to cover up the entire issue.

Inorder to find clues to allegations of swindling of funds under the scheme, the Centre has halted release of development fund from the treasury of Latehar district until any action is taken in the investigation report.

The sequence of events started when the Rural Development Ministry received a complaint last year informing about the involvement of the contractors in MNREGS work in Latehar and murder of the whistle-blower into the scam.

Thereafter, the Ministry ordered an enquiry in 2010 by a team headed by Rohit Kumar, Deputy Secretary, MNREGS which found all the allegations to be true.

The probe also exposed that several development projects were yet to come into reality.

Following the probe, Jharkhand’s Rural Development Secretary was directed to take stern action against the guilty. However nothing was done except for the action on junior officials.

Meanwhile,former member of Central Employement Guarantee Council, Dr Jyanendra informed the Centre through an e-mail that the BDO of Manika, Panchayat Sewak of Runkikala Basudev Nagesia and post master were hand in glove in embezzling MNREGS funds.

The e-mail was forwarded to Jharkhand Rural Secretary Santosh Kumar with a direction that in the absence of any action by the state government, Government of India will be duty-bound to act against the defaulters under Section 27 (2).

Dr Jyanendra sent another e-mail revealing the murder of whistle blower Niyamat Ansari who was an activist in MNREGS Sahayata Abhiyan and had revealed siphoning off funds in development works. Following his revelation, action was taken against the local BDO and Panchayat Sewak.

Underlining missing links in the version of the district administration, the report called for a CBI probe into the murder and particularly the role of the district administration and the district police.