The Directorate of Enforcement’s Raipur Zonal Office has intensified its investigation into alleged irregularities in the Chhattisgarh Public Service Commission (CGPSC) recruitment process. According to an ED press release dated 2 September 2026, search operations were conducted at five premises across Raipur, Durg, Dhamtari and Jashpur districts on 1 September 2026.
The searches were undertaken under the Prevention of Money Laundering Act, 2002 (PMLA), in connection with allegations involving corruption, manipulation and the leaking of examination question papers. The ED also arrested Utkarsh Chandrakar, one of the accused, under Section 19 of the PMLA.
The allegations concern public recruitment examinations conducted during 2020 and 2021. Since appointments to senior government positions are involved, the case raises significant questions about the integrity of competitive examinations, financial trails arising from alleged illegal payments and the wider consequences of corruption in public recruitment.
Background of the CGPSC Investigation
The ED initiated its investigation based on two First Information Reports registered by the Economic Offences Wing and Anti-Corruption Bureau, Raipur, and the Central Bureau of Investigation’s Anti-Corruption Branch in Raipur.
The FIRs reportedly named Taman Singh Sonwani, then Chairman of the CGPSC, and other individuals. They relate to alleged large-scale irregularities, manipulation and corruption in the State Service Examinations conducted by the Commission in 2020 and 2021.
According to the ED, the examination process was allegedly compromised by leaking question papers to relatives of accused individuals and selected candidates. Private brokers were also allegedly involved in supplying confidential examination material in exchange for illegal payments.
The alleged scheme is particularly serious because it reportedly resulted in fraudulent selections for important public positions, including Deputy Collector and Deputy Superintendent of Police. Recruitment to such posts is expected to follow strict standards of confidentiality, fairness and merit. Any deliberate interference can affect not only individual candidates but also public confidence in the administration.
Alleged Proceeds of Crime Exceed ₹3 Crore
The ED press release states that its investigation identified the alleged generation of proceeds of crime exceeding ₹3 crore by Utkarsh Chandrakar and Dr. Vikash Chandrakar.
According to the agency, money was allegedly collected in cash from job aspirants after they were assured access to leaked question papers for the CGPSC 2021 examination. Of the total amount allegedly collected, approximately ₹2.80 crore was reportedly handed over to Anil Chandrakar.
The ED further alleged that Utkarsh Chandrakar used the name, position and influence of K.K. Chandravanshi—his maternal uncle and then Personal Assistant to the former Chief Minister of Chhattisgarh—to influence job aspirants and collect money. The name of a former Officer on Special Duty in the office of the then Chief Minister was also allegedly used for this purpose.
These remain allegations under investigation. The arrest of an accused under the PMLA does not, by itself, amount to a judicial determination of guilt. Liability and guilt must ultimately be decided through the applicable legal process.
Previous Searches and Arrest under the PMLA
The ED had previously conducted searches in the same matter on 3 June 2026. The agency stated that the evidence gathered during its investigation included statements recorded under Section 50 of the PMLA, digital evidence retrieved from a mobile phone and an analysis of bank statements.
Based on this material, the ED claimed that Utkarsh Chandrakar knowingly participated in activities connected with the alleged proceeds of crime. The activities cited by the agency include their generation, acquisition, possession, concealment, layering, transfer, use and projection as untainted property.
He was consequently arrested on 1 September 2026 under Section 19 of the PMLA. This provision authorises designated ED officers to arrest a person when the statutory requirements are satisfied and the officer has recorded reasons to believe that the individual is guilty of an offence punishable under the Act.
The latest search operations reportedly resulted in the seizure of documents, digital devices, financial records, property-related papers and other evidence considered relevant to the investigation. The ED confirmed that further investigation was in progress.
Why Financial and Digital Evidence Matters
In a money-laundering investigation, authorities generally examine how suspected illegal funds were generated, received, moved, stored and ultimately used. Where transactions are primarily conducted in cash, establishing the financial trail may be more complex.
Investigators may therefore rely on a combination of bank statements, mobile-phone records, messages, documents, property transactions and statements from persons connected with the case. The objective is to determine whether the assets under examination are linked to a scheduled offence and whether any person knowingly assisted in concealing, transferring or presenting the proceeds as legitimate.
Businesses and professionals must recognise that regulatory investigations are rarely limited to formal accounting records. Digital communications, personal accounts, third-party transfers and property documents can also become important evidence. Maintaining incomplete records or conducting unexplained Cash transactions can create serious Compliance and reputational risks.
Practical Lessons for Businesses and Professionals
The CGPSC investigation offers several broader compliance lessons:
- Organisations should document the source, purpose and recipient of all material payments.
- High-value cash dealings should receive enhanced scrutiny and must comply with applicable tax and legal requirements.
- Transactions involving employees, relatives, intermediaries or politically exposed persons require appropriate due diligence.
- Personal and business funds should be kept clearly separated.
- Digital communications and financial records should be preserved under a structured retention policy.
- Management should investigate unusual payments, unexplained advances and transactions lacking commercial justification.
- Any regulatory notice, search or summons should be addressed promptly with support from qualified legal, tax and forensic professionals.
A weak Compliance framework can expose an organisation to regulatory action even when senior management claims to have had no direct knowledge of an improper transaction. Effective controls, clear approval systems and periodic reviews can substantially reduce this risk.
The Larger Takeaway
The case highlights how alleged corruption in a recruitment process can develop into a wider financial investigation under the PMLA. When illegal payments are allegedly collected, transferred, concealed or used to acquire assets, the matter can extend beyond the original offence and attract money-laundering scrutiny.
It also demonstrates the importance of preserving the integrity of public examinations. Candidates invest considerable time and resources in competitive recruitment. Any manipulation of the process can damage institutional credibility, deny deserving candidates a fair opportunity and undermine confidence in public administration.
At the same time, all accused persons are entitled to due process. The ED’s findings and allegations will remain subject to judicial scrutiny, and the final outcome will depend on the evidence placed before the competent courts.
Shunyatax Global Insights
The investigation underlines the need for strong financial documentation, transparent transactions and immediate professional support during regulatory proceedings. Businesses should regularly assess whether their payment systems, third-party relationships and record-keeping practices can withstand scrutiny from enforcement and tax authorities.
If you or your business is facing challenges involving a PMLA investigation, ED search, financial scrutiny, regulatory notice or compliance review, Shunyatax Global can provide professional guidance to help you understand the issues, organise the necessary documentation and move forward with clarity and confidence.
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Disclaimer: This article is based on an official ED press release and is intended solely for general information. Allegations mentioned in the release have not been independently verified and should not be treated as proof of guilt. This content does not constitute legal, tax or financial advice. Readers should consult qualified professionals for advice based on their specific circumstances.