Union Minister for Heavy Industries and Steel H.D. Kumaraswamy on Saturday, 29 August alleged that Karnataka Minister for Planning and Statistics B. Nagendra was effectively pushed out of the state Cabinet to shield the Karnataka Congress government from political fallout over alleged financial irregularities in the Karnataka Maharshi Valmiki Scheduled Tribes Development Corporation. Kumaraswamy, speaking to reporters in Bengaluru, said Nagendra's own admission — that he resigned to prevent embarrassment to the party — only raised deeper questions about the alleged ₹84 crore scam.

Kumaraswamy's Core Charge

Reacting to Nagendra's public statements, Kumaraswamy demanded accountability rather than optics. 'It is not important who won or who gets publicity. He has claimed that he tendered his resignation to avoid embarrassment to the Congress party. What is the reason for this embarrassment? Why was he forced to resign? What was the ₹84 crore scam? Was Nagendra made to resign to escape from this?' Kumaraswamy asked.

The Union Minister alleged that funds earmarked for the welfare of Scheduled Tribe communities had been misappropriated and distributed among individuals — a charge the state government has not publicly addressed in detail. He contended that Nagendra's exit was a calculated move to deflect responsibility away from the ruling party rather than a genuine act of accountability.

Kumaraswamy Hits Back on His Own Cases

Nagendra had reportedly countered by questioning whether Kumaraswamy himself faced legal cases. The Union Minister acknowledged the cases but dismissed them as politically motivated. 'These allegations have been continuing for the last 14 years. They have kept the cases alive, but they cannot silence Kumaraswamy. Are there any allegations that I have taken money? Do I face charges of causing losses to the government exchequer?' he said.

Kumaraswamy also noted that despite serving as Chief Minister on two separate occasions, he had not used his position to close or suppress those cases. 'If I had done anything wrong, I could have buried the cases when I became Chief Minister twice. I did not do that. I have left them open for investigation,' he said.

Governor Seeks Cabinet Opinion on Prosecution Sanctions

The political row is unfolding alongside a significant constitutional development. Karnataka Governor Thawar Chand Gehlot has sought the state Cabinet's opinion on granting prosecution sanction in connection with B. Nagendra. Separately, the Governor has also sought the government's view on prosecution sanctions against former minister Renukacharya and Bharatiya Janata Party (BJP) MLA Gali Janardhana Reddy in distinct matters.

According to government sources, the Karnataka government finds itself in a difficult position as it weighs these decisions — each of which carries significant political and legal consequences for the ruling Indian National Congress (Congress).

Background: The Valmiki Corporation Controversy

The Karnataka Maharshi Valmiki Scheduled Tribes Development Corporation irregularities have cast a long shadow over the state administration. Allegations centre on the diversion of tribal welfare funds, with the purported figure of ₹84 crore cited in connection with the case. This comes amid broader scrutiny of welfare-fund management across several state-run development corporations in Karnataka. Notably, the controversy has intensified pressure on the Congress government, which came to power in 2023 on promises of transparent governance.

With the Governor's prosecution-sanction queries still pending a Cabinet response, the case is unlikely to recede from Karnataka's political spotlight anytime soon.