Feb. 12: The Supreme Court has stayed till tomorrow the arrest of Teesta Setalvad, an activist and a trenchant critic of Narendra Modi over the 2002 riots, after Gujarat police took lightning action in a post-carnage embezzlement case.

The dramatic events unfolded today soon after Gujarat High Court rejected the anticipatory bail plea of Teesta and her husband Javed Anand, observing that "they cannot be armoured with full-fledged anticipatory bail when the applicant did not cooperate with the investigation". The court referred to "shocking facts" about the misuse of funds for "personal" benefit.

Within 15 minutes, Gujarat police officers landed up at the sea-facing bungalow of Teesta in Mumbai's Juhu but she was not at home. The response time makes it clear that the police team was already in Mumbai and was reasonably confident that the bail plea would not be granted.

With Gujarat police at the doorstep of the Mumbai home, the scene of action shifted again, this time to the capital.

Senior lawyer and Congress leader Kapil Sibal moved the Supreme Court and sought an urgent hearing. A bench headed by Chief Justice H.L. Dattu said Teesta and her husband would be protected from arrest until the matter was heard by the apex court on Friday. Sibal, along with advocate Aparna Bhat, mentioned the plea when the three-judge bench was hearing another case.

Teesta and her husband had been booked by the crime branch of Gujarat police on charges of cheating and breach of trust and offences under the IT Act.

The case relates to the construction of the now-aborted Museum of Resistance in the Gulbarg Society housing complex in Ahmedabad. On February 28, 2002, in the aftermath of the Godhra train carnage, rioters had massacred 69 people, including former Congress MP Ehsan Jafri, in Gulbarg Society.

One of the riot victims from Gulbarg Society had lodged a complaint with the police against Teesta, Javed and two NGOs run by them - the Citizens for Justice and Peace (CJP) and the Sabrang Trust, alleging misappropriation of Rs 1.51 crore.

The accused had collected funds in the name of converting a part of Gulbarg Society into a museum but spent Rs 1.51 crore elsewhere, according to the complaint.

Teesta could not be traced when an eight-member team from Gujarat police, including three women, and two constables from Mumbai police, reached the bungalow in Juhu.

The bungalow is shared by Teesta and her sister. Teesta, 53, traces her roots to a family of lawyers - her grandfather M.C. Setalvad was the first attorney-general of the country.

Teesta's husband, who is a former journalist, was at home. "Javed was questioned about her whereabouts. He also faces arrest along with Teesta. He told them Teesta was not available and had left home early in the morning to tend to an emergency in the family," said a CJP activist.

The police team searched the house for over an hour and a half and left. Teesta had contended earlier that they had been implicated in the case and were victims of "political vendetta" being carried out by the perpetrators of the riots.

In 2006, social activists had decided to build the Museum of Resistance at the site of the Gulbarg Society. Three years later, a part of the plot was sold to the Sabrang Trust.

But the plan for the museum was dropped in 2012 as the cost escalated, according to sources close to Teesta. But the complaint alleged that funds were collected in spite of the plan being abandoned.

Earlier in the day, the high court had rejected Setalvad's plea for a stay on its order to allow them time to move the Supreme Court.

It said their custodial interrogation was "in public interest" and "in the interest of justice".

"The applicant has never cooperated with the probe and whenever she was called for questioning, she insisted that the police ask her everything in writing and maintained that she had said everything in her affidavits before the sessions court," the high court said.

The court added that affidavits by witnesses had brought out several "shocking facts" about the applicant having used the funds collected in the name of the riot victims and meant for the poor and the needy for personal and materialistic purposes.

The sources close to Teesta said she had been "dishonestly" implicated for petitioning the Supreme Court to seek the prosecution of Modi and 62 other politicians and officials for alleged complicity in the 2002 riots.

"Gujarat police have charged them with spending the money on her family's travel expenses, groceries, wine, branded shoes, wristwatches and make-up. The police have claimed they have documents and bills to prove the charges. But Teesta says that the charges are based on malicious financial manipulation by the police and a section of the trust members who have been bought over," said a CJP activist.

Among those who have switched sides is Teesta's former accountant, Rais Khan. Khan had accused Teesta and Javed of misusing the funds meant for the Gulbarg society victims.

Last year, when a sessions court had rejected a bail application, Teesta and Javed had approached Bombay High Court but they were directed back to Gujarat.

The additional advocate-general, P.K. Jani, submitted in the high court that the state government had no objection to anticipatory bail being given to three other accused - Tanvir Jafri, son of the late Ehsan Jafri; Firoz Gulzar, the chairman of Gulbarg Society; and Salim Sandhi, the secretary of the society.