The Telangana government on Friday decided to cancel TS EAMCET-II 2016 in the wake of leakage of the question paper and hold fresh exam for admission to the medical courses in the state.
The decision was taken by Chief Minister K Chandrasekhar Rao after the CID submitted its report.
The chief minister took the decision at a meeting with some cabinet colleagues, Director General of Police Anurag Sharma and other top officials.
More than 50,000 students had appeared in TS EAMCET-II held on July 9 but doubts about the leakage of question paper were raised with average students bagging top ranks.
Following persistent demands by a section of students and their parents, the government ordered a CID inquiry.
The CID made its third arrest on Friday with a 52-year-old "broker" who allegedly collected Rs 1.73 crore from parents of 14 students.
Shaik Ramesh alias Raheem, hailing from Prakasam district of Andhra Pradesh, was arrested at Boduppal in the outskirts of Hyderabad.
"This broker procured 14 students from various places in Telangana and Andhra Pradesh and took them to Pune camp, where they were given practice with leaked question paper", the agency said.
Of the Rs 1.73 crore, he paid Rs 1.2 crore to another broker who took the students to the Pune camp. CID said Rs 15 lakh was deposited in bank account of his friend.
An amount of Rs 37.5 lakh was seized from Ramesh's possession, CID said, adding efforts are on to apprehend other brokers and kingpins behind the leak.
The agency has also identified some suspected middlemen during the investigation.
"In the investigation conducted so far, some brokers and sub-brokers belonging to Hyderabad, Andhra Pradesh, Bengaluru and other places have been identified," CID had said yesterday.
The duo, identified as Vishnudhar alias Vishnuvardhan and Thirumal alias Thirumal Rao, were arrested from Hyderabad.
"Vishnuvardhan and Rao allegedly contacted students, parents and took about 25 of them to Bengaluru where one Rajagopal Reddy arranged practice of questions and answers to them (before appearing for the exams)," CID had said.
The Engineering, Agriculture and Medical Common Entrance Test (EAMCET-II) was conducted on July 9 and the results were declared on July 14. The examination was conducted by Jawaharlal Nehru Technological University (JNTU), Hyderabad.
The investigators believe 100 students benefited from the leakage of question papers and the persons involved collected Rs 15 crore from these students.