SNDP microfinance scam: Kerala HC summons Additional Chief Secretary over delay in granting prosecution sanction

The Kerala High Court on Thursday pulled up the State government over continuing delays in granting sanction to prosecute certain officials who were allegedly involved in the SNDP microfinance fraud case [MS Anil v State of Kerala & anr and connected case]..Justice A Badharudeen today rejected the State's request for two more weeks time. The judge proceeded to order Additional Chief Secretary of the Backward Classes Development Department to personally appear before the Court tomorrow (September 11) and explain the delay in granting prosecution sanction. The Court recalled that last month, it had specifically directed the authority to decide on the grant of sanction without fail by September 10, 2026 (today)."Since the direction of this Court has not been complied with in the matter of granting prosecution sanction without any justification, the prayer of the learned Public Prosecutor to grant further time is rejected. Post tomorrow for appearance of the Additional Chief Secretary to explain why he failed to comply the order," the Court directed..The microfinance scam case concerns alleged misappropriation of about ₹15.85 crore in government funds disbursed under a microfinance scheme intended to benefit members of marginalised communities.These funds were given in the form of loans to the Sree Narayana Dharma Paripalana (SNDP) Yogam, which were allegedly then misappropriated.The Vigilance and Anti-Corruption Bureau (VACB) had registered a case in 2016 over these allegations of misappropriation of funds by SNDP Yogam office-bearers, including then-SNDP Yogam General Secretary, Vellappally Natesan and others.Notably, the High Court recently ordered Vellappally Natesan's removal from the post of General Secretary over the SNDP's failure to submit financial statements within statutory deadlines..Meanwhile, a plea was filed before the High Court by one MS Anil, who sought an effective investigation by a Special Investigation Team (SIT) into the alleged microfinance fund misappropriation.In August, 2026, the investigating officer informed the Court that the involvement of various accused persons had been found in eight cases. He also informed the Court that a prosecution sanction was required from the State before proceeding further against some of the cases.Since there are allegations that the microfinance scam was carried out in connivance with officials of the Kerala State Backwards Classes Development Corporation (KSBCDC), the State is required to give sanction before such officials can be prosecuted.On August 14, the Court had noted that the Secretary / Additional Chief Secretary of the State's Backwards Classes Development Department was the competent authority to grant such sanction.However, the State's public prosecutor today informed the Court that the sanction is yet to come through.Displeased by this delay, the Court has now summoned the Additional Chief Secretary of the State's Backwards Classes Development Department. The matter will be heard further tomorrow..Advocate D Anil Kumar appeared for the petitioner, MS Anil..[Live Coverage]