Justice Joymalya Bagchi and Justice V Mohana, sitting as a bench, reversed a Kerala High Court order that had denied the trio the chance to challenge a single judge's directive to register an FIR.
The Supreme Court also stayed the investigation into the FIR for seven days, providing temporary protection while the FIR remains in force.
The court’s remarks highlighted procedural lapses: a preliminary inquiry was not carried out, and the state failed to obtain the necessary approval under the Prevention of Corruption Act; it made no judgment on the merits of the allegations.
CPI(M) leader P Rajeev called the judgment a setback for the "ED‑VD" combo, while BJP National Secretary K Surendran said the decision did not grant a clean chit and that the FIR would still be pursued; both parties claim the court did not favour the accused.
The alleged 278 crore disbursement could have funded critical public works in Kerala, affecting thousands of residents who rely on those services.