Additional SP Mr RM Khan grilled Bhanu for more than six hours at its Koti office in Hyderabad for his involvement in granting licenses to the Gali-owned Obulapuram Mining Company (OMC) during his tenure as the special secretary in the CMO during the YSR regime.

This was second time Mr Bhanu was questioned by the CBI in the case. He was earlier questioned by the agency on Nov 17. Bhanu is presently the Chairman of the Indian Tea Board and is stationed at Kolkata.

The investigating agency has already questioned another IAS officer Y. Srilakshmi twice for her role in the issue of licenses in favour of Mr Gali Janardhan reddy. Srilakshmi, accused number 4 in the case, is yet to be arrested.

The CBI questioned Srilakshmi on Sunday for the second time in the presence of Mr Sasi kumar who alleged she had demanded bribes from him for granting leases of iron ore mining. Sources said Srilakshmi denied having ever met Sasikumar. Sasikumar told her he met her during a flight from Delhi to Hyderabad and discussed the iron ore licenses.

When she denied knowledge of this meeting, Sasikumar asked her to take a vow to that effect in the Kanipakam Lakshmi Ganapathi temple. Srilakshmi however failed to respond even to that challenge and broke into tears, according to sources.

Reports said that CBI officials on Sunday broke open the bank lockers of Srilakshmi and recovered some incriminating documents, cash and gold.