The Karnataka High Court has granted a stay on the process of transferring the gold and diamond jewellery belonging to the late former Tamil Nadu Chief Minister J Jayalalithaa to the neighboring state government until March 26th.

The stay was granted by a single judge bench of Justice Mohammed Nawaz on Tuesday, following a plea filed by Jayalalithaa's niece, J Deepa.

The valuables, confiscated in connection with a disproportionate assets case against the late AIADMK leader, were scheduled to be handed over to Tamil Nadu authorities starting Wednesday by a special court.

The petitioner challenged the July 12, 2023, special court order, arguing that Jayalalithaa should be considered "acquitted" since the Supreme Court had halted the proceedings against her.

The special court had stated that 27 kg of gold and diamond jewellery, which formed part of the material evidence in the case against Jayalalithaa and others, would be transferred to the Tamil Nadu government on March 6 and 7.

This decision aimed to unlock the value of the assets to facilitate the collection of the Rs 100 crore fine imposed on her. While 20 kg were permitted for sale or auction, the Court exempted the remaining seven kg, considering that it had been inherited from her mother.

The Tamil Nadu government had stated that it would proceed with the necessary actions for the disposal of the gold and diamond jewellery. The trial was conducted in Karnataka as per the directive of the Supreme Court, and consequently, all material evidence is currently housed in the Karnataka treasury under the custody of the court.

In ordering the transfer of the jewellery to the Tamil Nadu government, the Special Court judge stated, "Instead of auctioning the jewels, it is better to transfer the same to Tamil Nadu by handing over the same through the Department of Home, State of Tamil Nadu." The Court then directed the Tamil Nadu Home Department to authorize "competent persons, preferably in the rank of secretary, along with police, to come and collect the jewels.”

Additionally, the special court ordered the payment of Rs five crore to Karnataka for the expenses of the trial conducted in the state. This payment would be made from a fixed deposit in an account related to Jayalalithaa in the State Bank of India branch in Chennai.

The trial against Jayalalithaa, her former close aide V Sasikala, V N Sudhakaran (Jayalalithaa's disowned foster son), and Sasikala's sister-in-law J Ilavarasi was conducted by the special court, which convicted them nearly ten years ago.