The CBI had lodged an FIR under the Prevention of Corruption Act against Bhat in September 2005 after the latter was found in possession of Rs 41.76 lakh, allegedly disproportionate to his known sources of income.

“In view of the evidence collected by the prosecution, I am not inclined to accept the closure report which is accordingly rejected. Further investigation be carried out,” Additional Sessions Judge I K Kochhar said in a recent order.

CBI, in its closure report, had given a clean chit to Bhat, contending that its investigation had revealed that he received incomes from sale of ancestral and other properties, which were not accounted for during the preliminary probe.

The report had further claimed that a part of the money was in fact received as donations from individuals and other organisations for a charitable society, of which he was the chairman.

Refusing to buy CBI’s claims, the court observed that the inquiry was not conducted in a proper manner and though the money was shown as sale proceeds of some properties, it was never looked into as to from where did Bhat buy those assets.

The agency had also not investigated about the person with whom the accused had entered into the impugned financial transaction, the ASJ said.

Pointing to another loophole in the investigation, the court stated that the donations reportedly received for the charitable society could not be said to be a part of the alleged disproportionate assets as there was no evidence that the society’s income had been converted into Bhat’s bank account.