The Supreme Court on Monday put on hold the trial proceedings against Bishop Dharmaraj Rasalam, the former moderator of the Church of South India (CSI), who is facing allegations of money laundering linked to admissions at a Kerala medical college.
A bench of justices Vikram Nath and Sandeep Mehta also issued notice to the Enforcement Directorate (ED), seeking its response to the bishop’s appeal challenging the ongoing prosecution.
Appearing for Rasalam, senior advocate S Muralidhar urged the Court to stay the proceedings before the trial court, arguing that the continuation of the case would cause irreversible prejudice before the bishop’s legal challenge is adjudicated. The bench agreed to pause the trial for the moment, keeping the proceedings in abeyance while the ED responds.
Rasalam, who formerly headed the South Kerala Diocese and served as moderator of the CSI, is accused of collecting ₹7.225 crore from parents of prospective students in exchange for promising admission to the Dr Somervell Memorial CSI Medical College in Karakonam. He is alleged to have directed parents to pay the money through intermediaries within the college administration, a charge he has consistently denied.
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The Supreme Court’s intervention comes against the backdrop of a detailed order passed by the Kerala High Court in March, where a single-judge bench had refused to quash the ED’s money-laundering probe. Justice VG Varun had dismissed Rasalam’s plea, holding that the material collected by the federal agency warranted further investigation and possible prosecution.
According to the ED’s findings placed before the high court, at least 28 candidates or their parents were allegedly asked to pay large sums in return for admission to medical courses. The agency claimed that the bishop sent the parents to Sri Thankaraj, then comptroller of the college, who in turn directed them to deposit the money with a clerk. Many of these students reportedly never secured admission despite paying hefty sums.
The ED further contended that significant portions of the money were used for infrastructure development at the medical college and were also diverted to the South Kerala Diocese. It asserted that Rasalam’s role in the chain of transactions was “well-established” and that he was liable to be prosecuted under the Prevention of Money Laundering Act (PMLA).
Rasalam, however, has maintained that the allegations are fabricated. His counsel earlier argued before the high court that as bishop and de facto chairman of several institutions, he was not involved in the day-to-day administration and merely advised parents who approached him seeking admissions. They also pointed out that the Kerala Police crime branch had previously investigated the same allegations and found them to be unfounded — a conclusion the High Court refused to rely on.
The case took a dramatic turn in July 2022 when the ED detained Rasalam at Thiruvananthapuram International Airport as he was about to board a flight to the United Kingdom, after which he was prohibited from leaving the country. The federal agency has since maintained that the case reflects a broader pattern of financial impropriety within the diocese.
