The complainant, proprietor of a firm having its office in Vadodara had alleged that the accused had demanded an illegal gratification of Rs.4.50 lakh for not involving him in an insurance fraud relating to another firm of Vadodara. After negotiations, the amount of bribe was fixed at Rs.2.5 lakh. This amount was delivered through a middle man who is an automobile agent.

CBI laid a trap and the middle man was caught red-handed while accepting a bribe of Rs.2.45 lakh on the behalf of the Inspector. Searches were conducted at the residential premises of the accused Inspector at Gandhinagar Jodhpur and Barmer.

In another development CBI arrested a close associate of AKL Telgi in Mumbai on 12.7.2004 in a fake stamp case. He assisted A.K.L.Telgi in recruitment of members of staff and marketing executives for various offices of AKL Telgi in Mumbai and Hyderabad.