Investors in the Eenadu-owned Margadarsi Financiers also took out a rally in support of Eenadu and Rao, alleging that the Congress government was carrying out a “witch-hunt” against the company.

Yesterday, CID officials raided three offices of the Hyderabad-based chit fund.

The state government alleges Margadarsi is registered as a Hindu Undivided Family, and has collected over Rs 2600 crore, in violation of RBI norms. The government also alleges that the company does not have enough money to pay back its investors, a charge which Rao denies.

All the Opposition parties demanded an adjournment in the House today, alleging that the search was carried out in contravention of court orders. A court had given police the permission to search Margadarsi offices, but a local metropolitan court stayed the search around 4.30 pm when Margadarsi appealed. The Opposition said police carried on searching the offices till late Wednesday night, and seized papers.

When the Speaker denied the Opposition permission to speak on the issue, they stalled proceedings. The House has been adjourned till tomorrow morning.

Later, Opposition leader Chandrababu Naidu criticised the Congress, saying the government was directly attacking the Eenadu Group as its paper was running stories against the government. The paper is known to be pro-Telugu Desam, and anti-Congress. “I will meet the Prime Minister on the issue, and ask him to look into the matter. Chief Minister Y S Rajasekhara Reddy is directly attacking press freedom, and we will not permit it,” said Naidu.

Police officials refused to comment on the issue, saying the matter was sub-judice.