Exiled CBI chief Alok Verma has been reinstated by the Supreme Court, three months after the government divested him of his powers and sent him on forced leave. In what is considered a huge setback to the government, the court cancelled its midnight order removing Alok Verma and installing an interim chief.

"Alok Verma can now go back to his office but cannot take any major policy decisions", the court has said.

"The legislative intent of insulating the CBI director is manifest," the court said, setting aside the government's move.

Alok Verma and his deputy Rakesh Asthana, the CBI's top two officers, were both sent on leave in October in the middle of a bitter feud between them.

Mr Verma challenged the move saying it went against the rules that mandate that the CBI chief has two years in office and can be removed only by a selection committee.

The government has argued that it had no option but to send both officers on leave since they were fighting like "Kilkenny cats". The Central Vigilance Commission, whose recommendation had spurred the government order, had said in court that "extraordinary situations need extraordinary remedies."

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