The junior engineer, Ram Bhavan, who is lodged in the Banda jail for the last seven days, was found to be COVID-positive in his medical reports received late on Monday.
The court directed the CBI to take over the entire investigation and constitute a special investigation team with sufficient expertise in the economic offence probe to investigate cases.
Officials said that Nazubuulla was produced in a special CBI court, Baruipur which remanded him in 10 days of CBI custody.
The high court on November 6 issued notice to the CBI on Sengar's appeal against his conviction and jail term and had also asked the agency to respond to his application.
The Maharashtra government had earlier informed the apex court that all guilty police officials have been punished or suspended from services.
Baig was summoned by the CBI on Sunday on alleged “material evidence” against him and grilled for several hours after which the CBI arrested him
A team of CBI officials, who arrived in Vijayawada from Visakhapatnam, reportedly questioned Lakshminarayana for more than one-and-a-half hours on the source of the social media posts.
The then executive engineer, Roop Singh Yadava, and a senior assistant in the Canal and Irrigation Department have been arrested in connection with the case, they said.
According to the graft case lodged against the BJP leader and two others in 2006, they had allegedly sanctioned Rs 50 lakh as a grant to a trust in a fraudulent manner.
This development comes after the Central government gave its nod to the CBI to proceed with the case.
Welcoming the court's ruling, the minister said that the agency 'goes anywhere and books anyone, particularly in non-BJP ruled states'.
The court said that the provisions are in tune with the federal character of the Constitution, which has been held to be one of its basic structures.
The CBI, during its searches, reportedly recovered several incriminating documents, mobile phones, material objects and cash.
The court subsequently on Thursday extended the arrested engineer's judicial custody till November 30.
The arrested junior engineer, a resident of Chitrakoot district, is alleged to have victimised about 50 children in the age group of 5-16 years in the districts of Chitrakoot, Banda and Hamirpur.