In a major setback for controversial activist Teesta Setalvad, who is facing arrest in a case of fund embezzlement, a special sessions court In Ahmadabad rejected her anticipatory bail plea on Wednesday, The Indian Express has reported.

Special judge P J Tamakyvala upheld the arguments of the of the Detection of Crime Branch (DCB), Ahmedabad, which is probing the case.

In April, Setalvad was booked for fraudulently obtaining Rs 1.4 crore for her trust from the Union Ministry of Human Resource Development (HRD) between 2010 and 2013. Setalvad’s former associate Raees Khan Pathan has filed a complaint against her and other trustees of the Sabrang Trust claiming that the HRD Ministry illegally sanctioned the funds to her under the 'Sarva Shiksha Abhiyaan'.

Between 2009 and 2012, the HRD Ministry was headed by Kapil Sibal.

According to the complainant, Setalvad's trust distributed education material that could cause communal disharmony. Pathan said that Setalvad and Sabrang Trust tried to “mix religion with politics” to spread disharmony.

The DBC has told the court that Setalvad and husband Javed Anand, who run the Sabrang Trust, had transferred the fund to their personal account. It has also accused the two of tempering evidence against them.