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Reddy, who is posted constable in I-Town police station in Mahbubnagar, had received the honour and citation from excise minister V Srinivas Goud, in the presence of district Superintendent of Police Rema Rajeswari on Independence Day.
The complainant, Ramesh alleged that despite possessing necessary documents, Reddy was constantly was demanding bribes from him while transporting sand.
Reddy was presented before an ACB court which remanded him to judicial custody.