Sources have said that the BJP has accepted Vasundhara Raje's defense of business deals between her son and Lalit Modi.
The Congress today alleged that Rajasthan Chief Minister Vasundhara Raje, her son Dushyant Singh and former IPL chief Lalit Modi had illegally converted the Dholpur Palace - a government property - into a luxury hotel.
The Dholpur Mahal was declared government property six times between 1954 and 2010, Congress leader Jairam Ramesh said, holding up documents that he said proved that the palace has not been with Ms Raje's family for six decades.
Mr Ramesh said Ms Raje's estranged husband Hemant Singh had told a court in 1980 that the palace wasn't personal property. "Niyant Private Limited, owned by Ms Raje, her son Dushyant Singh, daughter-in-law Niharaika Singh and Lalit Modi, has taken possession of a Rajasthan government property, converted it into a private high-end luxury hotel and invested over Rs.100 crore," he alleged.
"This is a private-private partnership to manage a public property, without any revenues accruing to the Government of Rajasthan," Mr Ramesh said.
Responding to the allegation, the BJP said the government had restored the Dholpur Palace to Dushyant Singh's father Hemant Singh in 1958, after taking over his other palace, Kesar Bagh. The party said in 2007, Hemant Singh had given it to his son by a court settlement.
In 2010, the UPA government had recognized Dushyant Singh as the owner of the Dholpur Palace, the BJP said, pointing out that he was paid compensation for a part of land taken from the palace grounds for a highway project.
The Dholpur Palace occupies a key place in business dealings between Lalit Modi and Dushyant Singh.
Ms Raje had cited the palace as part of the family assets while defending a deal between her son and Lalit Modi, under which Mr Modi paid Dushyant Singh a great deal of money. Mr Modi had purchased shares in Dushyant Singh's firm -- paying Rs 96,000 for each share priced Rs 10 - and the transaction had been questioned by the Congress.
Dushyant Singh's tax returns filed in 2013, however, showed the family palace was not as an asset of his firm, but in the name of a dependent - its value was declared as Rs. 16 crore.