The Central Bureau of Investigation (CBI) has arrested the acting chairman of the Company Law Board, R. Vasudevan for allegedly taking a bribe of Rs. 7 lakh ($15,000) from Manoj Banthia, a company secretary to award a favourable ruling in a matter being heard by him.

Vasudevan was arrested from his official residence in South Delhi late last night. "Rs 55 lakh ($1,11,458) including the 7 lakh bribe, was recovered from his residence, and a cash Rs. 3 lakh ($6,500) was recovered from Manoj Banthia. The company secretary was caught while delivering illegal gratification. The accused demanded illegal gratification to give favourable orders in a case being presided over by him," said CBI spokesperson.

The CBI has also registered a complaint against Ankur Chawla, an advocate appearing in the matter, under provisions of the Indian Penal Code and Prevention of Corruption Act. Vasudevan and Banthia have been remanded to judicial custody till November 30 by a special CBI Judge, O.P. Saini.

Vasudevan was heading the Directorate of Inspection and Investigation (DII) wing of the Ministry of Corporate Affairs and was looking into the violations of the Companies Act in the Satyam scam. With his arrest and graft charges having been filed against him, his investigations into the Satyam scam have come under a cloud. The Company Law Board authorities may have to relook into the investigations conducted by Vasudevan. With Satyam probe already delayed, the arrest of the presiding officer is bound to cause further delay.

Vasudevan had joined the Company Law Board about 3 months back and was the regional director of the Southern Region Bench at Chennai until S. Balasubramanian retired as the Chairman. If the allegations levelled against him are proved, this would be one of the rare instances where the presiding officer of a quasi judicial body has been caught red handed.

Kanthi Narhari, who is currently the Chairman for CLB in Chennai, is likely to preside over the Delhi and Mumbai benches till the appointment of a chairperson.