In a significant development in one of Karnataka’s most high-profile legal cases, Kannada actress Ranya Rao and Telugu actor-businessman Tarun Konduru Raju were granted statutory bail by Bengaluru’s Special Court for Economic Offences on May 20, 2025. The duo, accused in a multi-crore gold smuggling operation, secured default bail due to the Directorate of Revenue Intelligence (DRI)’s failure to file a chargesheet within the mandatory 60-day period. However, their release from Bengaluru’s Parappana Agrahara Central Prison remains unlikely, as both face detention under the stringent Conservation of Foreign Exchange and Prevention of Smuggling Activities Act (COFEPOSA), 1974, which permits preventive detention for up to a year without bail. This case, involving allegations of smuggling 14.2 kilograms of gold worth over ₹12.56 crore, has captivated public attention, raising questions about international smuggling networks, financial irregularities, and the misuse of privileges at Bengaluru’s Kempegowda International Airport.
The Case Unfolds: A Shocking Arrest at Bengaluru Airport
The case came to light on March 3, 2025, when Ranya Rao was intercepted at Kempegowda International Airport upon her return from Dubai. DRI officials, acting on a tip-off, discovered 14.2 kilograms of gold bars, valued at approximately ₹12.56 crore, concealed on her body using crepe bandages and tape. The gold was allegedly smuggled to evade customs duties amounting to ₹4.83 crore. Rao, listed as the primary accused (A1), was arrested immediately, marking the beginning of a sprawling investigation into a suspected international smuggling syndicate. Subsequent searches at her upscale Lavelle Road residence in Bengaluru uncovered additional gold jewellery worth ₹2.06 crore and cash amounting to ₹2.67 crore, bringing the total seizure to ₹17.29 crore.
Tarun Konduru Raju, named as the second accused (A2), was arrested on March 9, 2025, following forensic analysis of Rao’s mobile phone and laptop, which revealed his alleged involvement. A US citizen and grandson of a prominent Bengaluru hotelier, Raju is accused of facilitating the smuggling operation by procuring gold in Dubai and managing logistics for its transport to India. A third accused, Sahil Sakariya Jain, a Ballari-based jeweller, was arrested later for allegedly aiding in the disposal of 49.6 kilograms of smuggled gold, valued at around ₹40 crore, and facilitating illegal transfers of ₹38.4 crore to Dubai through hawala channels.
The Investigation: A Web of International Connections
The DRI’s investigation has uncovered a sophisticated smuggling network with ties to Dubai. Authorities allege that Rao and Raju made 26 joint trips to Dubai between January and March 2025, often returning the same day, a pattern that raised suspicions of systematic smuggling. Rao is reported to have traveled to Dubai 56 times since 2023, with 45 of those being single-day round trips. The DRI claims that the duo used Raju’s US passport to clear customs in Dubai, falsely declaring that the gold was destined for Geneva or Bangkok, only to smuggle it into India. A Dubai-based company, Vaira Diamonds Trading, co-founded by Rao and Raju in 2023, is suspected to be a front for laundering smuggling profits.
The Enforcement Directorate (ED) and Central Bureau of Investigation (CBI) have also launched parallel probes, focusing on financial transactions and potential hawala networks. The ED is scrutinizing Raju’s banking records for evidence of suspicious money flows, while investigators suspect that Rao’s business ventures, including Xiroda India (formerly Bio Enho India), may have been used to legitimize illicit wealth. The case has also drawn political attention, with Rao’s stepfather, DGP K. Ramachandra Rao, being placed on compulsory leave due to allegations of misuse of police protocol services to facilitate Rao’s airport movements.
Legal Battles: Bail Denied, Then Granted
The legal proceedings have been contentious, with multiple bail applications filed by Rao and Raju. Initial pleas were rejected by the Special Court for Economic Offences and the Bengaluru Sessions Court, citing substantial evidence of their involvement and the risk of them fleeing the country. Rao’s counsel, Senior Advocate Sandesh Chouta, argued that her arrest involved procedural irregularities and that the offenses under the Customs Act were compoundable, warranting leniency, especially for a female accused. Raju’s legal team, led by Senior Advocate Devaraju, contended that there was no direct evidence linking him to the smuggling, dismissing allegations as based solely on Rao’s statements, which they claimed were delayed and unreliable.
On April 26, 2025, the Karnataka High Court, presided over by Justice S. Vishwajith Shetty, also rejected bail pleas for both accused, emphasizing the seriousness of the economic offense and the ongoing investigation. However, on May 20, 2025, the Special Court for Economic Offences granted statutory bail due to the DRI’s failure to file a chargesheet within the stipulated 60 days. The court imposed strict conditions, requiring Rao and Raju to execute personal bonds of ₹2 lakh each with two sureties, appear for all hearings, cooperate with the investigation, refrain from tampering with witnesses, and obtain court permission before leaving the country. Violation of these conditions could lead to bail cancellation.
Despite this legal victory, the invocation of COFEPOSA on April 22, 2025, against Rao, Raju, and Jain has effectively blocked their release. Rao’s mother has challenged her daughter’s detention under COFEPOSA in the Karnataka High Court, with the hearing adjourned to June 3, 2025, pending objections from the central government.
Broader Implications: Economic Security and Public Trust
The case has sparked significant debate about economic offenses and their impact on national security. The prosecution has argued that gold smuggling, beyond evading customs duties, threatens the economic fabric of the country by fueling illegal financial networks. The involvement of high-profile figures like Rao, a well-known actress, and Raju, a businessman with international connections, has amplified public interest. The case also raises questions about airport security protocols, particularly how Rao allegedly used VIP escort services to bypass customs checks, facilitated by her stepfather’s influence.
The ongoing investigations by the DRI, ED, and CBI, coupled with the Gaurav Gupta-led committee’s probe into protocol misuse, underscore the complexity of the case. The committee has already recorded statements from airport police personnel, revealing that Rao received escort services typically reserved for senior officials, highlighting potential vulnerabilities in airport security systems.
Looking Ahead: A Long Road to Resolution
As the legal battle continues, the focus remains on whether the DRI can substantiate its claims of a larger smuggling syndicate and whether the accused will face further charges under COFEPOSA or other laws. The case’s political ramifications, particularly the scrutiny of a senior police officer’s involvement, add another layer of intrigue. For now, Rao and Raju remain in custody, their bail overshadowed by the stringent provisions of COFEPOSA, while the public awaits further developments in this high-stakes drama.
This case serves as a stark reminder of the challenges in combating economic crimes and the need for robust systems to prevent the misuse of privileges. As investigations deepen, the outcome will likely have far-reaching implications for both the accused and the broader fight against smuggling in India.
Sponsored
FACTS Transcripts
Apply for a University document anywhere
https://www.factstranscript.com
Quick Transcripts for popular Universities, check your University name now and get started. We help you to get your transcript application online which is accepted for use of IRCC.
No DD, NO Paperwork. 100% Authentic, Reliable.
FACTS Transcripts Charges · Reviews · Assam Universities · Home · Know your University
