Kochi/Thiruvananthapuram: Suspended IAS officer M Sivasankar, former principal secretary to Kerala Chief Minister Pinarayi Vijayan, was arrested by the Enforcement Directorate (ED) on Wednesday in a case relating to the diplomatic baggage gold smuggling scam.

Sivasankar, whose name cropped up in the case after it was found that he had close links with Swapna Suresh, a key accused in the smuggling case, was taken into custody by the ED from an Ayurveda hospital in Thiruvananthapuram where he was undergoing treatment. The central agency took him into custody minutes after the Kerala high court rejected his anticipatory bail pleas in the case. He was taken to Kochi then. His arrest was recorded at the night after interrogation that lasted for hours. After being arrested, Sivasankar was taken to the Ernakulam General Hospital for medical tests. He will be produced before the court on Thursday.

The high court dismissed two separate anticipatory bail pleas filed by him apprehending arrest by Customs investigating the smuggling angle and ED probing the money trail in the case.

Sivasankar was arrested for allegedly helping Swapna stash the money she received through illegal means, TV reports said.

Opposition seeks CM's resignation

With the arrest of Sivasankar, once the most powerful officer in the state, the opposition Congress and BJP have mounted pressure on CM Pinarayi Vijayan demanding his resignation over the matter.

Leader of the Opposition Ramesh Chennithala reiterated that Vijayan has to be made an accused in the case. “This is the last nail in the coffin of the LDF government,” he said.

BJP state president K Surendran also demanded the chief minister's resignation saying that Vijayan was involved in the shady deals. "When the agencies question Sivasankar, more details will come out. The court order has cornered the Left government in the state. As the investigation progresses, the involvement of the chief minister and his office will become clear," Surendran said.

Earlier in the day, protests were held at various parts of the state, including in front of the secretariat in Thiruvananthapuram, by opposition parties and their youth wings demanding the resignation of the CM.

The protesters even burnt Vijayan in effigy in some places.

Dismissing Sivasankar's plea seeking anticipatory bail in the ED case, the high court observed that the agency was relying on the statements given by him as also prime accused in case, Swapna Suresh and his chartered accountant Venugopal.

There is clear indication that the IAS officer was very close to Swapna.

Sivasankar had discussed the deposit of amounts belonging to Swapna with his chartered accountant.

He had introduced her to the chartered accountant and had asked him to sort out her financial problems, Justice Ashok Menon mentioned in the order.

The court further said the statements given by the accountant and the accused Swapna strongly indicate the involvement of Sivasankar.

"It is alleged to be in consequence of the directions given by the applicant that Swapna Suresh and the Chartered Accountant (Venugopal) opened a locker in the State Bank of India, Thiruvananthapuram Branch. Both of them had rights to operate the locker. Even though the applicant (Sivasankar) has disassociated himself from activities pertaining to the deposit of amounts in the locker, there is some indication in the communications between him and the chartered accountant regarding the applicant overseeing the management of the finances of Swapna Suresh", the court said.

Noting that the ED has not yet concluded whether the applicant is to be made an accused or a witness in the crime, the court said there are strong indications pointed out by the agency to suggest that the applicant may be a person involved in the money laundering with Swapna.

"Probably there may not be sufficient evidence at present collected by the ED to implicate the applicant as an accused, and there also may not be sufficient evidence to suggest that he is guilty of the offences alleged.

But, they have sufficient materials to interrogate him, for which he is bound to cooperate, as a senior government official", the court said dismissing the bail plea.

Rejecting the contentions made by Sivasankar that he was connected with the affairs of the government and had in such capacity interacted with Swapna Suresh, the secretary to the Consulate General, UAE, the court observed that "If that be so, there is no need for him to interfere in matters concerning management of her finances."

Dismissing the anticipatory bail application by Sivasankar in the gold smuggling case, the court said the fact that he was in constant touch with Swapna and even volunteered to help her by contacting his accountant indicates that there is a possibility that he knew of the involvement of Swapna in the 'smuggling activity.'

"Whether the applicant was himself actively involved in the commission of the offence is something which is to be investigated and found out," the judge said.

Referring to a Supreme Court judgement, the judge said, "I find that the power of the Customs department to question the applicant under Section 108 cannot be curtailed by granting anticipatory bail. The relief sought for is undoubtedly premature. Therefore, I am of the opinion that the applicant is not entitled to anticipatory bail."

Meanwhile, Law Minister A K Balan said the government wanted all the culprits in the gold smuggling case to be brought to book and extended support to the central agencies in the probe.

"The chief minister has sought a comprehensive probe by the central agencies on July 8. We just want the law to take its course. Also, the agencies have not complained against the state government as we have provided necessary assistance to them for the investigation," Balan told the media.

Central agencies---National Investigation Agency, Customs and the Enforcement Directorate, are conducting separate inquiries into the seizure of gold worth nearly Rs 15 crore from a "diplomatic baggage" at Thiruvananthapuram International airport on July 5.

Several people, including two former employees of the UAE consulate in Thiruvananthapuram, Swapna and Sarith P S, have been arrested by the central agencies in connection with the case.