This article has been written by Oishika Banerji of Amity Law School, Kolkata. This article provides a detailed analysis of the top 10 Indian political scams that the democratic land of India has witnessed over the years.
This article has been published by Sneha Mahawar.
Put simply, the term ‘scam’ signifies fraudulent activities that amount to disrespect expressed towards legally, morally and ethically structured societal norms that take the form of a law. A politician is someone who participates in party politics or holds or seeks an elected government position. Politicians propose, support, and reject laws that govern the land and, by implication, the people that live there. Thus, scams in the hands of these politicians have a detrimental effect on the people of the nation in general. According to the International Monetary Fund (IMF), corruption costs the world up to $2 trillion. That is a substantial amount of money as it amounts to 2% of global GDP. On December 9, the United Nations commemorated International Anti-Corruption Day, recognising the urgent need to eradicate corruption and promote global unity and stronger ties. ‘United against corruption for prosperity, peace, and security’ was the key subject in the same. As per a recent research by Transparency International, a Berlin-based anti-corruption NGO, India is the “Most Corrupt Country in the Asia-Pacific Region.” According to the report, seven out of ten persons in India had to pay a bribe to gain access to public services. Over the last few years, measures to combat corruption and the growing threat of black money have dominated national debate. The Central Government has implemented a number of measures and legislation to combat corruption in India, including the establishment of the Goods and Services Tax and the demonetisation of high-value currencies. This article aims to discuss the ten biggest politician scams that India has experienced and the possible consequences they had on the nation, its economy and the people.
Indian political scams
India tops the global black money list, with almost US$1456 billion in Swiss banks (around USD 1.4 trillion) in the form of black money. India has more black money than the rest of the world combined, according to figures from the Swiss Banking Association Report (2006). The assets in Indian Swiss bank accounts are worth 13 times the country’s national debt. Indian black money is occasionally physically moved outside of India as well.
According to a poll conducted by Ficci and Pinkerton India, the main risk factors affecting India are corruption, bribery, and corporate fraud. The poll, which was conducted to analyse risks across industries and geographical regions of the country, found that the recent unravelling of scams and frauds in both the public and private sectors has increased corporate risk perception. Strikes, closures, and unrest were also identified as the second most significant risk, and they continue to worry corporate India. It was regarded as the most significant risk factor in the 2013 poll. J K Sinha, a member of the National Disaster Management Authority, announced the survey stating that political and governance instability came in third place, which is particularly concerning given the forthcoming Lok Sabha elections, while crime and information and cyber insecurity came in fourth and fifth place, respectively. Sinha emphasised the importance of a system that allows businesses, government, and other stakeholders to predict and respond to disasters, particularly in areas of the country that are sensitive to such risks.
The protagonists are led by Indian politicians, with the main theme being real estate. Many Indian enterprises, such as real estate corporations, are infamous for corruption, and fund managers avoid the sector. State politicians have turned it into the current corruption capital, with Bangalore being equally famed for land grabbing and real estate scams perpetrated by bureaucrats and politicians. Mafia bosses have grown powerful enough to destabilise governments, with some serving as ministers. With the Commonwealth Games Scam, Adarsh Housing Scam, and the Multi-Billion 2G Telecom Spectrum Auction Scam, India’s image of corruption is deteriorating day by day. As few people are prosecuted for corruption, India’s political and business elite have little regard for the country’s justice system. Only a few tiny fish are made scapegoats, while the ringleaders openly and deliberately manipulate and corrupt the system.
Scams appear virtually every day in India, indicating that corruption has become widespread and deliberate. Most of us must have witnessed or been a victim of the corruption that exists in some sector of the country in our everyday lives. In recent years, India has been rocked by a slew of frauds. Here’s a rundown of some of the most well-known frauds to have hit the nation over the years.
Why are political scams an issue
The criminalization of Indian politics is a problem. Mafia bosses have grown powerful enough to overturn governments, with some serving as ministers to the government. In July 2008, The Washington Post stated that about a fourth of the 540 Indian Parliament members faced criminal allegations which “included human trafficking, immigration rackets, embezzlement, rape and even murder”. Things are frequently worse at the state level. Candidates with criminal backgrounds won the majority of seats in the Uttar Pradesh Assembly elections in 2002. Our political system has been rattled by the recent revelations in Wilki, where people were seen proposing bribes to show their majority in parliament.
Laws surrounding scams in India
Specifically speaking, India doesn’t have any separate legislation dedicated to political scams, although the same is very much in need during present times. Therefore, to understand the laws governing political scams in India, it is necessary to note that the term scam is said to be inclusive of fraudulent activities, lying, cheating, forgery, misappropriation, undue influence, coercion, etc. Rather than deeply digging into the legislation specifically governing the aforementioned offences, let us identify the offences, their inclusivity and the way the same is viewed with respect to India, specifically throwing light on political scams.
Fraud is defined as the taking or gaining of property, money, vouchers, or anything of value from another person through deception, lying, or trickery supported by verbal or written documents, causing the victim to place his trust in the perpetrator and willingly hand over something of value from himself to the perpetrator. When fraud is committed against government property or valuable items, it is considered a serious felony. This could result in a harsh penalty, such as stringent imprisonment.
Fraud under Indian Penal Code, 1860
The following provisions of the Indian Penal Code, 1860 contain fraud implications:
- Removal or hiding of property for the purpose of preventing its distribution among creditors (Section 421): This Section discusses fraud in the context of insolvency. A dishonest disposition of property with the purpose to cause unlawful loss to a creditor is an offence under it. Benami transactions (one where a person’s own name is not used but the name of another person or a fictitious person is used instead) will be covered. This clause carries a penalty of up to two years in prison and a fine. This is a charge that can be bailed out.
- Fraudulently prohibiting creditors from accessing debt (Section 422): By disguising the property, it is possible to prevent creditors from being defrauded. This covers any action taken to prevent the attachment and sale of debts owed to the accused. This is a charge that can be bailed out. The penalty is up to two years in prison, with or without a fine.
- Execution of a fraudulent deed of transfer with a false statement of consideration (Section 423): This is a type of deceptive execution that deals with-:
- False statement about consideration, and
- receipt of a false beneficiary’s name.
Punishment is imprisonment up to 2 years with or without a fine and it is a bailable offence.
- Theft or hiding of property through deception (Section 424): This Section discusses fraud in the context of insolvency. A dishonest disposition of property with the purpose to cause unlawful loss to a creditor is an offence under it. Benami transactions will be covered under this. This clause carries a penalty of up to two years in prison and a fine. This is a charge that can be bailed out. There must be concealment or removal for this Section, and it must be done dishonestly or fraudulently. This Section is for cases that do not fall within the scope of the three most valuable fraudulent claims.
The Indian Penal Code, 1860 considers cheating to be a criminal offence. It is done in order to earn or get an advantage from another person through deception. The individual who deceives another is well aware that he or she is putting the other person in an unfavourable situation. Cheating can be made a criminal offence under Section 420 of the 1860 Code.
Cheating is when someone deceives another person into believing something that is not true. Cheating has an impact on a person’s physique, reputation, and any property that the individual may acquire or own. Cheating can be done by someone in a fiduciary relationship, and it has an impact on the person who has been defrauded. In order to fool the opposing party, a person can cheat by misrepresenting the facts or utilising fake proof. The individual who is fooled considers the deceiving party’s representations to be real, which has a negative impact on the person’s mental and physical health. Cheating can cause stress, and tension, and have a negative impact on a person’s mental health. It can also lead to trust issues, making it difficult for the individual who has been duped to trust someone else again. After being duped, a person may suffer from low self-esteem and financial loss due to the loss of property.
Cheating under the Indian Penal Code, 1860
- Section 405: Violation of trust can also be classified as a civil or criminal breach, as specified by Section 405 of the IPC. Section 405 specifically cites the terms “dishonest misappropriation” and “conversion” of property, both of which can be the outcome of the accused’s actions if he continues beyond opening the receptacle.
- Section 415: Cheating is defined as deceiving a person fraudulently or dishonestly in order to compel that person to give property to another person or consent to keep the property under Section 415 of the Indian Penal Code, 1860. If a person fraudulently, dishonestly, or willfully encourages another person to do or omits to do something that he would not have done if he had not been fooled, and the act causes harm to that person’s body, mind, reputation, or property, that person is said to cheat. Cheating is defined as any dishonest concealing of information that deceives a person into performing an act that he would not have done otherwise.
- Section 24: Acting dishonestly is defined in Section 24 of the IPC as performing or omitting to perform any act that results in a wrongful gain or loss of property to a specific person. Dishonesty is defined as an act performed with the intent of gaining property or causing a loss to another person.
- Section 416: Cheating by personation is defined in Section 416 of the IPC as when a person deceives someone by claiming to be someone else, or when a person deliberately substitutes a person for another or claims a person to be someone else. The individual who is standing in for another person should be aware that the other person is not the same as the person he is representing. When the person who is personated is a real person, not an artificial person, the offence of cheating by personation is committed.
- Section 417: Section 417 of the IPC makes simple cheating illegal. Section 417 of the Indian Penal Code indicates that anyone found guilty of cheating faces a sentence of imprisonment for a term up to one year, a fine, or both fine and jail.
- Section 418: A fiduciary relationship is one in which two parties share the highest good faith and confidence for the purpose of a transaction. Section 418 of the IPC applies to cases of cheating in which the parties had a fiduciary relationship. Guardians, trustees, agents, solicitors, Hindu family managers, managers or directors of a company or a bank in deception to the shareholders, and so on can all cheat out of the fiduciary connection. Section 418 of the IPC deals with situations in which there is a trust between the parties and the trust is abused by cheating.
- Section 420: The intention and objective of the person cheating are also considered, and if it is determined that the accused had a malafide intention to cheat on the person, the accused would be charged with cheating under Section 420 of the IPC. In general, a complaint is filed under Section 420 of the IPC when a person suffers from a defect in the cheater’s services or products, or when a person is charged more than the MRP for a product or service, or when a person suffers losses and damages from unfair trade practices, etc. However, even if the person who cheated does not suffer a monetary loss or damage, the accused can still be held liable for cheating.
- Section 462: Trespass was defined as a violation of an individual’s right to privacy. Trespassing was not deemed a crime for the general public until the legislation said otherwise. If a person is entrusted with property and tries to open that receptacle containing property with the aim to conduct damage or dishonesty, he is liable under Section 462 of the Indian Penal Code, 1860. The same offence is also covered by Section 461 of the IPC. The factor of trust in Section 462 is the only variation. The person is entrusted with the goods in this case. This is why the penalty under this provision is more severe than the penalty under Section 461 of the Code.
Section 425 of the IPC defines mischief. It is defined as any act committed with the intent of causing wrongful loss or damage to the public or to any individual. The intent is also a key component. If there was no awareness of the criteria under this section or the act was the consequence of an accident or negligence, the act cannot be covered under mischief. In cases of mischief, intent cannot be determined if there is a dispute over who owns the property. The accused cannot be held accountable if he performed the act in the belief that the good was his own. The same is true if the property has no owner. No person can be held liable for a wrongful act or trespass against a property which has no owner.
The term “forgery” is defined under Section 463 of the IPC. Forgery of documents or electronic records is dealt with under Sections 463 to 477-A.
- Section 463: According to Section 463 of the Indian Penal Code, 1860, forgery is defined as the creation of a false document or electronic record, or part of a document or electronic record, with the intent to cause damage or injury to the public or to any person, or to support any claim or title, or to cause any person to part with property, or to enter into any express or implied contract, or with the intent to commit fraud or that fraud may be committed.
- Section 464: This Section of the Indian Penal Code, 1860, deals with situations when a person is accused of fabricating a document or electronic record. The following are examples of these scenarios:
- To begin with, when a person dishonestly or fraudulently prepares, signs, seals, or executes a document and transmits any electronic record with the goal of making it appear as if the document was prepared, signed, sealed, or executed by the authority of a person whose authority he knows it was not.
- Second, when a person edits a document or an electronic record in material part without lawful authority and in a dishonest or fraudulent way, either by himself or by another person.
- Third, when a person acting dishonestly or fraudulently causes another person to sign, seal, execute, or alter a document knowing that such a person does not understand the contents of the document or the nature of the alteration due to his or her incapacity, such as insanity, intoxication, or deception.
- Sections 466 to 469: Sections 466 to 469 of the IPC deal with scenarios in which a forgery offence has been exacerbated. For example, severe kinds of forgery include forgery of a court or public register record, forgery of valuable security, will, or another document, and forgery with the intent to defraud or destroy another person’s reputation. However, the severity of the punishment varies from case to instance.
- Section 466: Section 466 is usually used in cases when the accused falsely forges a document or an electronic record to make it appear as if it was issued by a government agency, such as falsifying a marriage certificate.
- Section 467: The offence specified in Section 467 is an aggravated version of the offence mentioned in Section 466. It specifies a penalty of either life imprisonment or a period of imprisonment up to ten years with a fine.
- Section 468: When a person forges a document or an electronic record for the purpose of cheating, he is penalised under Section 468. The penalty under this Section is a seven-year sentence that is cognizable, non-bailable, and non-compoundable.
- Section 469: Section 469 deals with circumstances in which a person falsifies a document or electronic record in order to injure another person’s reputation. Such a person will be sentenced to prison for a period of up to three years, as well as a fine. Unlike Section 468, however, such an offence is bailable.
- Sections 470 and 471: Section 470 specifies the types of documents that fall into the category of falsified documents, whereas Section 471 establishes the culpability of anybody who misrepresents a forged document as authentic or legitimate.
- Sections 472 to 476: Sections 472 to 476 deal with cases of fraud including the creation of false documents using counterfeit seals, plates, or instruments.
Criminal breach of trust
Criminal misappropriation happens when possession has been acquired properly, but the retention has been unjust and fraudulent as a result of a subsequent change of intention or the discovery of new facts/information.
- Section 405: Section 405 of the Indian Penal Code, 1860, defines criminal breach of trust. In a nutshell, the clause refers to “dishonest misappropriation” or “conversion to own use” of another person’s property.
- Section 403: The difference between criminal breach of trust and criminal misappropriation (under Section 403) is that in criminal breach of trust, the accused is entrusted with property or has authority or control over the property but in misappropriation that is not the case.
- Sections 407 and 408: Acts of misappropriation or breach of trust committed by strangers are regarded less harshly than acts of misappropriation or breach of trust committed by those who enjoy the special trust and have access to a lot of information or authority, or because of their standing, such as a public worker. As a result, Sections 407 and 408 of the Code provide for additional penalties of up to seven years in the instance of criminal breach of trust by anyone entrusted with property as a carrier or warehouse-keeper.
More severe punishment of life imprisonment or imprisonment for up to ten years with a fine is imposed for public servants. This is due to the exceptional prestige and confidence that a public worker enjoys as a representative of the government or government-owned firms in the eyes of the general public.
- Section 409: Such a breach of trust by public officers, bankers, merchants, or agents is defined under Section 409 of the Indian Penal Code, 1860. In such cases, the persons involved have a special fiduciary relationship. Public servants are entrusted with more than ordinary citizens and consequently have more responsibilities. As a result, any such breach of trust is faced with harsher penalties, up to and including life imprisonment, as opposed to the punishment meted out to regular criminals.
Criminal conspiracy as defined under Section 120 A of the IPC states that when two or more persons agree to do or cause something to be done, it is called a conspiracy.
- An infraction of the law, or
- A criminal conspiracy is defined as an act that is not illegal but is carried out through illegal means.
Provided, however, that no agreement, other than an agreement to commit an offence, constitutes criminal conspiracy unless the individual acts in accordance with the agreement.
Under Section 120B, when there is a conspiracy related to an offence punishable with death, life imprisonment, or a rigorous punishment for two years, there shall be no express provision in this Code about its punishment, and the offender was treated as if they abetted the same offence. On the other hand, para 2 covers all conspiracies other than those mentioned in para 1, and all conspiracies covered in para 2 shall be punishable with imprisonment.
Section 13 of the Prevention of Corruption Act, 1988
Section 13 of the 1988 Act deals with criminal misconduct by a public servant, which can be said to have happened if any one of the following circumstances unfolds:
- Habitual acceptance or obtaining or agreeing to accept or attempting to obtain from any person for himself or for any other person any gratification other than legal remuneration as a motive or reward.
- If he regularly accepts, obtains, agrees to accept, or attempts to obtain any valuable thing for himself or any other person without consideration or for a consideration that he knows to be insufficient from any person he knows to have been, or to be, or to be likely to be involved in any proceeding or business transacted or about to be transacted by him, or having any connection with the official functions of himself or any public servant to whom he owes any responsibility.
- Dishonestly or fraudulently misappropriated or otherwise converts for his own use any property entrusted to him or under his control as a public servant.
- Abusing his position by resorting to illegal means thereby intending to acquire pecuniary advantages.
- If he or anybody acting on his behalf is in possession of or has been in possession of pecuniary resources or property disproportionate to his known sources of income at any point during the tenure of his office, for which the public servant cannot explain satisfactorily.
2G Spectrum case (2007)
Ranked to be the second-biggest abuse of executive power by Time magazine, the 2G spectrum case is a combination of three cases, one filed by the Enforcement Directorate and two cases registered by the CBI. The scam has been discussed in the pointers hereunder:
- According to a report by India’s Comptroller and Auditor General (CAG), 2G, or second-generation, mobile network licences were given out for free instead of being auctioned off fairly. A Raja, the then-Telecom Minister, refuted the allegations, claiming that the decisions were made after then-apprising Prime Minister Manmohan Singh.
- In 2011, A Raja was arrested on allegations of forgery, fraud, and conspiracy. The main charge levelled against A Raja was that he allocated airwaves and cellphone network licences in exchange for bribes. According to allegations levelled against DMK MP Kanimozhi, he played a key role in transferring a bribe of 217 crores from Swan Telecom to Kalaignar TV, the party’s propaganda arm.
- According to the CAG investigation, all of the demand drafts were backdated, showing that the telecom operators were aware of the licences that would be given ahead of time. Swan Telecom was a front for Reliance Telecom, according to the CBI charge sheet, and Reliance Telecom broke telecom policy by acquiring more than 10% of the company, as was allowed by law.
- The Delhi High Court admitted a PIL against A Raja’s alleged wrongdoings in 2008. The Court discovered the so-called lies provided by the telecom ministry during the PIL hearing.
- In 2012, the Central Bureau of Investigation (CBI) informed the court that it would continue to investigate the true beneficiaries of the Anil Dhirubhai Ambani Group’s spectrum fraud (ADAG).
- The Supreme Court invalidated all 122 licences awarded in 2008 for a pittance of Rs 9,200 crore in February 2012, saying that these licences, and all-natural resources thereafter, should be issued solely through auctions/fair bidding processes. The Court ruled that the spectrum distribution was “unconstitutional and arbitrary.”
- Unitech Wireless, Swan Telecom, and Tata Teleservices were each fined Rs 5 crore by the Supreme Court. According to the Court, A Raja also “intended to favour select corporations at the expense of the public purse and essentially handed away vital national assets”.
- The United Progressive Alliance (UPA II) government was rattled by the widespread coverage given to the 2G Spectrum scam. It is seen to be one of the major factors that contributed to Manmohan Singh’s defeat in the 2014 Lok Sabha elections.
- Manmohan Singh, the then-Prime Minister, said in 2011 that his government had “failed in managing perceptions.” He had informed several reporters that “it’s possible that we didn’t handle perceptions properly. We should concentrate on altering people’s minds.”
- Raja later said in 2014 that certain groups dissatisfied with him submitted letters to Manmohan Singh, but that Singh was “unaware of the telecom strategy.” Kapil Sibal took over the Telecom Ministry after A Raja’s exit, and in 2011 he proposed the “zero loss” theory. He said that distributing 2G licences on a first-come, first-served basis resulted in no or minimal loss.
Referred laws by courts in the 2G Spectrum case
- Prevention of Corruption Act, 1988
- Section 13(1)(d)(iii): While holding office as a public servant, the officer obtains for any person any valuable thing or pecuniary advantage without any public interest.
- The Indian Penal Code, 1860
- Sections 120B: Punishment of criminal conspiracy
- Section 409: Criminal breach of trust by a public servant, or by banker, merchant or agent.
- Section 420: Cheating and dishonestly inducing delivery of property
- Section 468: Forgery for purpose of cheating
- Section 471: Using as genuine a forged [document or electronic record]
Role of the Special Court in the 2G Spectrum case
- In the 2G range assignment case, an exceptional CBI court had vindicated each of the 18 accused, including A Raja and K Kanimozhi. The ruse was discovered nearly seven years ago, when the Comptroller and Auditor General, or CAG, accused then-Telecom Minister A Raja of incurring a loss of Rs 1,76,379 crore to the state exchequer by dispensing 2G range licences at low prices. Nonetheless, the Court determined that the indictment lacked evidence to support the charges. Regardless, this judgement does not overturn the Supreme Court’s verdict or change the fact that the licences given during the 2G range distribution were illegal.
- In his judgement, Special Judge OP Saini stated that the charge sheet in the current case is based on a misreading, specific perusing, non-perusing, and outside the range of relevance perusing of the official record. The charge sheet is based on several oral proclamations made by the observers during the examination, which the observers, including the Special Judge, have not kept in the observer box.
- A Special Court acquitted all accused, including former Telecom Minister Andimuthu Raja and DMK President M Karunanidhi’s daughter, Kanimozhi, who were branded as perpetrators of one of India’s greatest scams, nearly six years after the Supreme Court annulled 122 2G licences. The prosecution had “miserably failed” to prove any charge against any of the defendants, according to the Court.
- The Court had added that “there was no evidence on the record given under the watchful eye of the court demonstrating any guiltiness in the alleged demonstrations identifying with an obsession for the cut-off date, control of the first-start things out served policy… I have no hesitation in declaring that the indictment has pitifully failed to establish any accusation against any of the defendants”.
Fodder Scam case
The fodder scandal was a watershed moment in Bihar politics, with some figures making a career out of it. The officer who first discovered fraud in the Bihar government’s feed industry did not receive sufficient credit. VS Dubey was the finance commissioner at the time. Dubey discovered the animal husbandry department topped the list in excessive withdrawals of money against government appropriations in December 1995, as part of his usual work of assessing the performance of several departments. Dubey dug deeper and discovered that excessive withdrawals have been on the rise for several years. For example, in 1993-96, the government allowed Rs 10.5 crore for the purchase of 5,664 pigs, 40,500 chickens, 1,577 goats, and 995 sheep, but the animal husbandry department withdrew Rs. 255.33 crore. Dubey calculated the total illegal withdrawals at Rs. 409.62 crore after accounting for over-expenses for other uses. The ruse had been exposed. The series of events surrounding the scam has been laid down hereunder:
- Between 1985 and 1995, the fodder scandal, also known as chara ghotala, involved dozens of incidents of financial irregularities totalling roughly Rs. 930 crore in the animal husbandry department of undivided Bihar.
- When expenditure information was not provided in a timely manner, the Comptroller and Auditor General (CAG) cautioned about money laundering in Bihar’s treasuries in 1985. The Congress was in power in the state at the time, and the Chief Minister was Jagannath Mishra.
- Finally, in 1996, the animal husbandry department’s deputy commissioner, Amit Khare, initiated a search. The documents collected suggested that money was embezzled under the guise of supplying fodder. It began with small-scale fraud perpetrated by low-level government personnel, but it has now expanded to include corporations and politicians.
- The state government established two commissions in the aftermath of the raids. One of them was led by state development commissioner Phoolchand Singh, who was eventually implicated in the scheme. The commission had to be cancelled as a result of this.
- Meanwhile, on the state government’s orders, the Bihar police had filed many FIRs. Several Public Interest Litigations (PILs) have been filed in the Patna High Court to have the matter transferred to the CBI. Sushil Modi, Saryu Rai, and Shivanand Tiwari of the BJP relocated one of these PILs.
- After hearing the petitions, the Patna High Court had noted in a March 11, 1996’s decision that “excess drawals in the Department have been taking place since 1977-78. The planned inquiry and examination, in our opinion, should encompass the full period from 1977-78 to 1995-96. I would, accordingly, direct the CBI, through its Director, to enquire and scrutinise all cases of excess drawals and expenditure in the Department of Animal Husbandry in the State of Bihar from 1977-78 to 1995-96, and lodge cases where the drawls are found to be fraudulent in character, and take the investigation in those cases to its logical conclusion as soon as possible; preferable, within four months.”
- The involvement of Lalu Prasad Yadav, former chief minister Jagannath Mishra, and top officials came under scrutiny as the CBI launched its investigation.
CBI investigation in the Fodder Scam case
- Following the judgement of the Patna High Court, the agency took up the investigation of 41 cases already filed by the state police, as well as 23 cases filed on the basis of intelligence reports and complaints. The CBI looked into a total of sixty-four fodder scam cases. The CBI filed the first FIR in the Chaibasa treasury case on March 27, 1996.
- In June 1997, the CBI requested permission from the governor of Bihar to prosecute Lalu, who was the Chief Minister at the time, and filed a charge sheet against him and 55 others under Sections 420 (forgery) and 120 (b) of the Indian Penal Code, as well as Section 13 (b) of the Prevention of Corruption Act, 1988.
- There were political consequences once Lalu was listed in the CBI charge sheet. He was a member of the Janata Dal at the time, which opposed him holding the position of chief minister while being suspected of a scandal. In July 1997, he formed the RJD in response to mounting pressure from the Janata Dal.
- He resigned as chief minister, but his wife Rabri Devi took over as his replacement. She received the confidence vote. Jharkhand was formed in 2001, and the cases were moved to it.
- According to the CBI, “the scamsters adopted a unique modus operandi in all cases by making fraudulent, excess withdrawals from the treasuries in Bihar on the strength of forged and fabricated allotment letters and fake supply orders for making payment to suppliers, who submitted bills without affecting the supply or, in a few cases, by making a partial supply of feed, fodder, medicine, instruments and other materials.”
Series of convictions in the Fodder Scam case
- Lalu and Mishra were charged in March 2012 with illicit money withdrawals from the Banka and Bhagalpur districts.
- In the Chaibasa case, Lalu and Mishra, along with 45 others, were convicted and sentenced to five years in prison by a CBI court on September 30, 2013. He was a member of Parliament at the time, and he was barred from contesting any election for the next eleven years.
- In December 2017, he was sentenced to three and a half years in prison and a fine of Rs 10 lakh for illegally withdrawing funds from the Deoghar treasury. However, Jagannath Mishra was found not guilty.
- In January 2018, he was sentenced to five years in prison for illegally withdrawing Rs 33.67 crore from the Chaibasa treasury, and in March of the same year, he was sentenced to seven years in prison for fraudulently withdrawing Rs 3.13 crore from the Dumka treasury.
- Hundreds of people have been convicted in the scandal, including Lalu Yadav and Jagannath Mishra. According to a document provided by the CBI, 295 accused persons on single charges and 821 accused persons on repeated counts have been convicted and fines ranging from Rs 20,000 to Rs 1.2 crore have been levied on them by courts.
Adarsh Housing Society scam
The Adarsh Housing Society is a 31-story residential building in Mumbai’s Colaba neighbourhood. The structure was built to shelter military heroes and war widows during the 1999 Kargil war. The complex’s tenants, on the other hand, were bureaucrats and families of politicians who had nothing to do with the Kargil war. The scam and the lined-up events have been discussed in pointers hereunder:
- The flats in the building, which were supposed to be a six-story structure, were primarily registered in the names of proxy owners. In 2013, the CBI filed a formal complaint. 14 persons were accused of criminal conspiracy (Section 120B) under IPC and various provisions of the Prevention of Corruption Act, including then-Maharashtra Chief Minister Ashok Chavan. Chavan was forced to retire by the state’s Congress, which was in control at the time.
- The Maharashtra government formed a two-member judicial team to investigate the claims in 2011. In their results from 2013, the researchers discovered 25 illicit allotments, including 22 purchases made by proxy.
- The central agency presented its first charge sheet in the matter before a special CBI court on July 4, 2012. During the examination, it was discovered that the society did not have environmental approval. The Bombay High Court had ordered the apartments to be demolished and demanded the beginning of criminal proceedings against politicians and bureaucrats for alleged power abuse, ruling that the skyscraper had been built illegally. It had requested that the demolition be carried out at Adarsh Society’s expense by the Union Ministry of Environment and Forest.
- The then-Maharashtra Chief Minister’s relatives allegedly held three properties in the Adarsh Housing Society, including his mother-in-law. According to information received through RTI, Chavan allowed the sale of 40% of the houses to civilians.
- The prosecution of Chavan had been a source of controversy in the case. K Sankaranarayanan, the Maharashtra Governor at the time, refused to provide authority to prosecute Chavan in December 2013. However, a Sessions court eventually declined to remove his name from the case’s list of defendants. In 2015, the Bombay High Court upheld the Court’s decision.
- Governor Vidyasagar Rao of Maharashtra gave the CBI authority to pursue Chavan in 2016. Chavan, on the other hand, petitioned the Bombay High Court to overturn the ruling.
- CBI arrested Pradeep Vyas, the Secretary (Expenditure) of the Maharashtra Government’s Finance Department, in 2012, making him the first serving bureaucrat to be arrested. The CBI’s charge sheet named twelve bureaucrats along with Chavan. So far, nine of them have been arrested namely, Jairaj Phatak, Ramanand Tiwari, TK Kaul, A R Kumar, M M Wanchoo, Kanhaiyalal Gidwani, JK Jagiasi, and Mandar Goswami.
- The Court ordered the structure to be dismantled in 2016, citing the fact that it was built unlawfully. The group took their case to the Supreme Court, which imposed a stay on the demolition in 2018. The Indian Army has guarded the building after directives from the Supreme Court.
The decision of the judicial commission formed under the Maharashtra Coastal Zone Management Authority (MCZMA) in the Adarsh Housing scam
- The Maharashtra Coastal Zone Management Authority (MCZMA) has rejected the Adarsh Cooperative Housing Societies’ request to correct previous infractions relating to Floor Space Index (FSI), land ownership, and zoning in a large development. The MCZMA has decided not to submit the society’s proposal to the MoEF, citing a high court decision and a notification from the ministry of environment, forest and climate change. The Adarsh Housing Society is a 31-story building in South Mumbai built on premium real land.
- “The matter of Adarsh CHS has been treated by the Hon’ble High Court of Bombay, which has observed that petitioners have utilised floor space index (FSI) of 2.932 as against the allowable FSI of 1.33,” the authority wrote in its judgement. They further stated that “the entire construction carried out by the petitioners (Adarsh CHS) is unlicensed and illegal, and is in complete violation of the requirements of the Maharashtra Regional Town Planning Act of 1966 and the Environment Protection Act of 1986.”
- The Maharashtra Coastal Zone Management Authority (MCZMA) has rejected the Adarsh Cooperative Housing Societies’ request to correct previous infractions relating to floor space index (FSI), land ownership, and zoning in a large development. The MCZMA has decided not to submit the society’s proposal to the MoEF, citing a high court decision and a notification from the Ministry of Environment, Forest and Climate Change. The Adarsh Housing Society is a 31-story building in South Mumbai built on premium real land.
- “The authority has dismissed the Adarsh CHS’s demand to regularise past transgressions based on Supreme Court and High Court judgements,” an MCZMA official had informed The Free Press Journal. He further added that “in conclusion, the authority highlighted that the HC ruling remains in effect, and the MCZMA is duty-bound to adhere to the findings and observations in the Adarsh CHS matter.”
- The Authority has requested that the Mumbai Metropolitan Region Development Authority (MMRDA) withdraw Adarsh CHS’s occupational certificate, which was awarded on October 30, 2010. The MMRDA’s position on the subject was presented to the high court, which reached a decision on April 29, 2016. The Adarsh CHS contested the High Court’s ruling in the Supreme Court. The building’s demolition was halted by the Supreme Court.
- Following that, the Supreme Court ordered the Union of India to take possession of the building without issuing any interim orders. MMRDA had stated in its submission that “in light of the foregoing, the HC’s ruling of April 29, 2016, remains in effect, and MMRDA shall comply with the same as well as any additional directives issued by the MCZMA.”
- According to the Coastal Regulation Zone (CRZ) notification of March 6, 2018, “all activities, which are otherwise permissible under the provisions of this notification but have commenced construction without prior clearance, would be considered for regularisation only in such cases wherein this project applied for regularisation within the specified time, and those which are in violation of CRZ norms would not be regularised.”
- Furthermore, the authority concluded that the March 6, 2018, notification for post-facto clearance could not be used to Adarsh CHS’ application because it was not otherwise permitted. As a result, the authority determined that the proposal could not be forwarded to the MoEF for regularisation in accordance with the CRZ Notification of March 6, 2018.
- The verdict is significant because Justice JA Patil and P Subrahmanyam (retired IAS) of the two-member judicial commission declared Adarsh was not a story of perfect cooperation, but rather a shameless tale of flagrant violations of statutory provisions, norms, and regulations. According to the panel, it demonstrated avarice, nepotism, and favouritism on the part of some individuals.
SNC-Lavalin Kerala Hydroelectric scandal
- The incidents that led to the case occurred during Pinarayi Vijayan’s tenure as Kerala’s Energy Minister, from 1996 to 1997. The issue concerns a contract between the Kerala State Electricity Board (KSEB) and SNC-Lavalin, a Canadian business, for the repair of three hydel power plants in Kerala. Although the two entities signed a memorandum of understanding for a consultancy during the final years of the Congress administration, from 1991 to 1996, it was during Vijayan’s tenure in 1997 that the memorandum was converted into a fixed-price contract for the supply of equipment and engineering services for the renovation of the projects at a cost of Rs 239.81 crore.
- Though the hydel stations were supposed to be renovated by September 2001, they weren’t finished until February 2003, after spending Rs 250.40 crore and incurring a Rs 69.83 crore finance liability. The KSEB failed to achieve the technology transfer and people training that was promised in the contract with Lavalin. Lavalin’s equipment was found to be flawed, and some of it was rendered useless.
- Lavalin had committed to help raise funds for the Malabar Cancer Centre (MCC), a hospital in northern Kerala. Lavalin was supposed to raise Rs 98.30 crore for this. However, up to February 2001, the real contribution was only Rs 8.98 crore. The remainder of the funding was not received by the government. The deal that awarded the project included funds for the MCC.
- The arrangement with Lavalin resulted in substantial losses for the government, according to the Assembly Subject Committee in 2001. That panel included CPI (M) leader Kodiyeri Balakrishnan, who is now the party’s state secretary and a member of the Politburo. The Congress government, now in control, authorised a Vigilance investigation a year later, but it failed to make any progress.
- According to a 2005 CAG investigation, the state lost Rs 374.5 crore on the deal. The findings in the audit report altered the path of the scheme and the Vigilance investigation was reopened as a result. The Vigilance presented its preliminary findings to the court in early 2006, accusing eight people. The attempt by Vigilance to file the FIR in court without telling the then-Congress administration sparked a debate. Only KSEB officials were named in the indictment. After charges that the police had let politicians off the hook, then-Chief Minister Oommen Chandy declared that the case would be handed over to the CBI near the conclusion of the Congress’s government in 2006.
- The LDF government, led by V S Achuthanandan, took office in May 2006. The government was adamant about not entrusting the investigation to the CBI. Vijayan was the State Secretary of the party at the time. The State Government filed a public interest lawsuit before the High Court, objecting to the central agency’s investigation. The CBI was given permission to investigate the case by the High Court in 2007. The investigation was delayed, which prompted the High Court to intervene once more.
- The CBI presented its final report to the High Court in January 2008, naming Vijayan as a defendant. Because Vijayan was the minister, the CBI sought the governor’s permission to charge him. Governor R S Gavai gave the go-ahead to prosecute Vijayan in June 2009. It was also the first time a Politburo member had been charged with bribery.
- The Lavalin case has sparked heated controversy in Kerala politics and the media, owing to Vijayan’s inclusion as an alleged defendant. V S Achuthanandan, Vijayan’s opponent and former chief minister from 2006 to 2011, does not agree with the party’s stance that the lawsuit was politically motivated. Achuthanandan had already been chastised for taking an anti-party stance on the topic. He continued to raise the matter until Vijayan took office in 2016.
Charges against Vijayan in the SNC-Lavalin Kerala hydroelectric scandal
- When the CBI’s final report was released, Vijayan was named as a suspect. There were 11 people named as suspects. Except for Vijayan and a senior executive from SNC-Lavalin, all of the other defendants were KSEB and power department bureaucrats at the time. They all retired over time, and a few even died as the years passed.
- Vijayan was charged under Sections 120B and 420 of the Indian Penal Code, 1860, as well as Sections 13(1) and 13(2) of the Prevention of Corruption Act, 1988. According to the CBI, Vijayan had shown remarkable enthusiasm for the agreement. In its report on Vijayan, the CBI had said that “the final contract with Lavalin was entered into without Cabinet consent; he held direct discussions with a senior manager of the SBI to get exemption of bank guarantee for the amount promised to the MCC; he finalised the contract without the formal approval of the KSEB; and he was keen to retain the Malabar Cancer Centre under the KSEB.”
Role of the judiciary in the SNC-Lavalin Kerala hydroelectric scandal
- The discharge petitions of Vijayan and six other accused in the case were granted by the CBI trial court in Thiruvananthapuram in 2013. The CBI, on the other hand, appealed the verdict to the High Court. The agency’s revision appeal was partially granted by the High Court, as Justice Ubaid overturned the discharge of three defendants in the case, including Vijayan.
- On August 24, 2017, the Kerala High Court confirmed the CBI court’s decision to release Chief Minister Pinarayi Vijayan from the case. The Court went on to say that the prosecution lacks sufficient and satisfactory evidence to build a prima facie case against the defendant. “I find that, notwithstanding material proving failure and inaction on the part of several ministers who succeeded him (Vijayan), the CBI wrongfully selected and chose the seventh accused of prosecution on an accusation of conspiracy without any material to substantiate it,” Justice Ubaid remarked. The petition was filed by the CBI at the Supreme Court in 2017.
- Another key moment for Vijayan will be the outcome of the CBI suit in the Supreme Court. The CPI (M) has always maintained that the lawsuit was used to smear Vijayan’s and the party’s reputations.
Housing Loan Scam in India (2010)
- The home loan scam involving state-owned institutions and Money Matters Financial Services Ltd., a private and publicly traded Mumbai-based company, had cast a pall on independent directors. Money Matters’ CMD and two top executives were arrested by the Central Bureau of Investigation (CBI) on 25th November 2019, and at least three of the four independent directors among them were former bankers and financial institution chairpersons. In fact, until May 2005, RN Bhardwaj, a non-executive independent director on the board of Money Matters, was the chairman of LIC and LIC Housing Finance. He was a member of the LIC from 1968 until his retirement in 2005.
- Money Matters allegedly bribed key officials at LIC and LIC Housing Finance while mediating and facilitating loans from these institutions for builders and corporations, according to the CBI. LIC Housing Finance’s Chief Executive was among those detained. B Samal, the former Chairman and Managing Director of Allahabad Bank, and VP Singh, the former CEO and Chairman of state-owned financial firm IFCI Ltd, were the other two joining the detention.
- Experts questioned whether they took their duty as “independent directors” seriously and asked the correct questions, given their knowledge and clout in the financial services industry. Sanjiv Kapoor, a chartered accountant who had audited the finances of the state-owned insurer LIC, was Money Matters’ fourth non-executive independent director. While Samal, Singh, and Bhardwaj have been members of the Money Matters board of directors since August 21, 2009, Kapoor was appointed as an independent director on July 10, 2010.
- What’s more alarming is that some of these independent directors also serve on the boards of corporations that CBI claims have benefited from these institutions’ loans. For example, Samal and Bhardwaj serve on the boards of JP Group companies, which the CBI has identified as one of the loan recipients.
- According to the CBI’s remand application submitted in court, the list of companies allegedly favoured with loans includes Krishna Group (Rs 1,000 crore), OPG Group (Rs 330 crore), BGR Energy (Rs 20 crore), Suzlon (Rs 125 crore under process), Adani, JP Hydro, JSW Power, Pantaloon, Adalite, MTECH, Lavasa, DB Realty, Pashmina, Mantri Realty, Sigrun, Entertainment World, Indore City Treasures, JP Group, Gold Sukh Project, JP Group and MBD.
- According to LIC Housing Finance, all of the loans were approved in accordance with relevant regulatory requirements, and all of the loans in question are currently performing assets. On its loan exposures to developers, LIC Housing Finance claimed that the competent authority conducted all procedures and due diligence commensurate with board-approved norms in approving the loans, as it had in the past. To the satisfaction of the sanctioning authority, all loans are secured by the underlying assets. All of the loans were approved in accordance with the applicable regulatory requirements. According to the firm, all of the loans in question are currently performing assets.
Laws governing the 2010 housing scam
The 2010 housing scam can be recognised as one of the well-established corporate frauds in India which saw the interference from the Finance Ministry as well. Laws governing corporate fraud in India are provided hereunder:
- Companies Act 2013: Section 447 of the Companies Act, 2013 stipulates that fraud is punishable by imprisonment for a period of six months to ten years, as well as a fine of up to three times the sum involved in the fraud. In this regard, Section 36 of the abovementioned legislation is crucial, as it outlines the penalties for fraudulently enticing people to invest money. In addition, Sections 448-451 and 454 deal with a variety of sanctions and punishments for corporate fraud.
- Prevention of Money Laundering Act 2012: The Prevention of Money Laundering Act of 2012 prescribes a penalty of 3 to 7 years in prison and a fine of up to 5 lakh rupees.
- Information Technology Act 2002: Section 66F (Acts of Terrorism) of the Information Technology Act 2002, increases the penalty to up to life imprisonment for anyone who endangers India’s unity, integrity, sovereignty, or security by denying authorised personnel access to a computer resource, attempting to access a protected system, or introducing any contamination into a system.
The Indian Contract Act 1872, Indian Penal Code 1860, Prevention of Corruption Act 2013, Information Technology Act 2008, and Prohibition of Insider Trading are among the other regulatory statutes that govern corporate frauds.
The Finance Ministry and its role in the housing scam
- The then Finance Minister, Mr. Pranab Mukherjee, attempted to downplay the scale of the kickbacks-for-loans controversy involving senior officials of state-run financial institutions, claiming that no evidence of insider trading has been discovered so far.
- Mukherjee, along with Finance Ministry officials and the CBI, worked to reassure depositors and investors, claiming that the banks were safe and that the case was a simple one of bribery. “You know, I’ve already directed banking and financial organisations to look into all of these issues,” the Minister had informed the reporters.
- Officials from the Finance Ministry, for their part, said that the scale of the scandal was too small to have an influence on the financial system. Officials from the CBI said that the fraud could be worth more than Rs 1,000 crore.
- LIC Housing Finance, whose CEO R R Nair was detained, had an exposure of Rs 388 crore to the eight real estate companies under investigation by the CBI, according to the Finance Ministry sources, which represents 0.9 percent of the company’s entire loan book of Rs 43,300 crore at the end of September 2010.
Kerala Solar Panel scam (2013)
- Initially, the ‘Solar scam‘ was nothing more than a simple case of deception. A businessman named Sajad filed a complaint in June 2013 alleging that a couple defrauded him by receiving Rs 40 lakh as a consultation fee in exchange for making him a partner in their solar fields project, but nothing came of it. Kerala police detained Saritha S Nair and her live-in partner Biju Radhakrishnan, who were partners in a Kochi-based firm that sold solar energy solutions, after receiving this allegation.
- According to reports, the pair used to solicit investments from business people and Non-Resident Indians (NRIs), offering to turn them into partners. The pair used to flaunt their political connections and proximity to then-CM Chandy in order to woo investors, this was one of the most talked-about issues in the case. According to certain local media sources, Saritha Nair and her partner used to wow potential investors by calling the then-staff CM’s directly on the phone, with one meeting taking place in the CM’s conference room.
- A political storm has erupted in Kerala over the alleged Solar Scam, in which former Chief Minister Oommen Chandy was accused of assisting those involved. The political brawl began when Chief Minister Pinarayi Vijayan presented a judicial commission report accusing Chandy and his subordinates, namely, Tenny Joppen, Jikkumon Jacob, and shooter Salim Raj of allegedly assisting the key suspects, Saritha S Nair and Biju Radhakrishnan. T Radhakrishnan, the then-home minister, was also accused in the report of attempting to protect Chandy from criminal culpability. In connection with the matter, the Chief Minister has also ordered an investigation against Chandy and others.
- Saritha Nair’s call records revealed that multiple calls were made to the then-staff CM’s members, including Joppen, whose cell phone Oommen Chandy is known to use, according to local media outlets Manorama News and Asianet News at the time. According to Manorama News, Saritha’s letter, dated July 19, 2013, accused then-CM Chandy and other key UDF politicians as individuals who solicited sexual favours from her in connection with the solar scam.
- The couple was then condemned to three years in prison and a punishment of Rs. 10,000 each by the Judicial Magistrate Court in Perumbavoor. In December 2016, Chandy spoke before the Commission, claiming that the charges against him were politically motivated.
Punishment granted and the present status of the Kerala solar panel scam
On April 27, 2021, a judicial First Class Magistrate Court in Kozhikode (north Kerala) convicted Saritha S Nair, the second accused in the solar scam case, to six years in prison and a fine of 40,000 rupees. Nair was found guilty of breach of trust (Section 406 of the Indian Penal Code, 1860), cheating (Section 420 of the Indian Penal Code, 1860), fabricating documents (Section 465 of the Indian Penal Code, 1860), and other crimes by the Court. Her second spouse, Biju Radhakrishnan, was the first accused, and his sentence was to be announced later. According to the Court, she must serve her sentence separately as she had already been found guilty in three other cases.
The discussed accusations are one of the 30-plus accusations filed against the couple in the 2013 Solar Fraud case. This case also concerns Abdul Majeed, a businessman who was defrauded in 2012. He accused them of defrauding him of Rs 42.70 lakh after promising to install imported solar panels in his business and home as well as franchise rights to their company. Many later withdrew their complaints, fearing negative publicity.
Using her connections, Saritha S Nair used to visit the CM’s office as well. When Oommen Chandy, the then-CM of Kerala, was named in the case, he was forced to fire two of his private secretaries and the state public relations director. Later, Nair accused various Congress leaders of sexual harassment, including Chandy. The Pinarayi Vijayan government handed up this allegation to the CBI two months ago, but the central agency has failed to investigate.
DLF Land Grab case (2013)
- In October 2011, activist Arvind Kejriwal (currently Delhi’s Chief Minister) accused Vadra of accepting a Rs 65 crore interest-free loan from DLF Limited in exchange for political favours. DLF answered that it had engaged with Vadra as a private business and that the loan was a ‘business advance’ granted in accordance with industry practice to pay for land Vadra had purchased. The corporation also stated that it did not sell him land at a reduced price and that there was no exchange of goods or services.
- The Central Bureau of Investigation (CBI) was also looking into Robert Vadra, former Haryana Chief Minister Bhupinder Singh Hooda, and DLF for potential land deal violations in relation to the Congress’ Bhupinder Singh Hooda government’s 50-acre land grab in Haryana’s Amipur village in 2013. Robert Vadra, the husband of Congress General Secretary Priyanka Gandhi and a Moradabad entrepreneur rose to prominence after marrying into the Nehru-Gandhi family in 1997, but he has since been dogged by allegations of land grabbing and shady business operations. He is claimed to have dropped out of college in the middle of his studies to join his family’s brassware and artificial jewellery business. Within a few months of the discussed scam, Vadra had allegedly generated unlawful gains of nearly Rs 50 crore from this land sale.
- Hooda’s generosity to land sharks and builders cost farmers and the Haryana government a lot of money. As a result, the CBI was investigating him and there are court charges pending against him in connection with dodgy land deals. For his relatives and close associates connected to the Indian National Congress, like Sonia Gandhi’s son-in-law Robert Vadra, these agreements include the allotment of highly subsidised land and a change in land use licence. The CBI has filed an 80,000-page charge sheet in the court in connection with this case and the Manesar land scam.
- Builders compel farmers to sell their land by persuading the government to use Section 4 of the Haryana land legislation to issue a government notification to the farmer stating that their land is needed for “public purposes.” Builders attempt to obtain this land by paying a slight premium over the government’s tariff for land acquisition. If landowners and farmers continue to object to the sale, relevant provision of the aforementioned legislation was to be invoked, that intends to declare the government’s desire to purchase land, forcing reluctant farmers to sell their land to builders at a low price.
- Once the builders have purchased the land, the government cancels the acquisition procedure and releases the land to new builders, as well as a change in land use licence to build residential and industrial structures on the farmland. This caused a sharp increase in land prices, resulting in large profits for developers, opportunity cost losses for farmers, and a loss of land tax revenue for the government. Hooda’s administration benefited Robert Vadra and DLF as beneficiary builders.
- After purchasing 3 acres of land for INR 7 crore and reselling it to DLF for INR 58 crore a few months after Hooda’s Indian National Congress Government granted a Change in Land Use licence to convert it from agricultural to commercial use, Vadra made an unlawful profit of more than INR 50 crore. Vadra purchased properties with DLF unsecured loans. In 2015, the “Justice Dhingra Commission” was established to probe the scam after the Bharatiya Janata Party (BJP) took power in Haryana. Hooda was indicted by the Dhingra Commission. According to the Dhingra Commission’s report, there was cooperation aimed at benefiting Vadra’s company Skylight Hospitality, and it requested more investigation. As a result, the case was sent to the CBI for further investigation.
Charges levied on the accused in the DLF Land Grab case
On September 1, 2018, Haryana Police filed an FIR against Robert Vadra, former Haryana Chief Minister Bhupinder Hooda, DLF Company Gurugram, and Onkareshwar Properties Gurugram for suspected violations in the Gurugram land purchase. Hooda and 33 others were charged by the CBI in February in a case involving alleged corruption in Manesar land deals worth over Rs 1,500 crore. The charges stemmed from land deals in Gurgaon’s Manesar, Naurangpur, and Lakhnoula villages.
Narada Scam case (2014)
- Mathew Samuel, the creator of the Narada fiasco, ran a sting operation in West Bengal for almost two years. It was conducted in 2014 for the news magazine Tehelka and was published months before the 2016 West Bengal Assembly elections on a private news website called Narada News. Samuel was Tehelka’s former managing editor.
- Samuel created a fictional company called Impex Consultancy Solutions and approached many Trinamool Congress (TMC) ministers, MPs, and leaders, asking for favours in exchange for money as part of the operation.
- TMC MPs Mukul Roy, Sougata Roy, Kakoli Ghosh Dastidar, Prasun Bannerjee, Suvendu Adhikari, Aparupa Poddar, and Sultan Ahmad (who died in 2017) were seen accepting alleged bribes in the form of wads of cash in exchange for extending unofficial favours for Impex Consultancy Solutions, which was floated by Samuel, in the 52-hour footage photographed by Samuel and his colleague Angel Abraham.
- HMS Mirza, an IPS officer who has now been suspended, was also caught collecting money from Samuel. Shanku Deb Panda, one of TMC’s leaders, was also seen requesting shares in Samuel’s fictional company in exchange for promised favours.
- Although Mukul Roy was not shown collecting payment in the video, he was seen instructing Samuel to come to his party’s office with the promised money. Samuel had alleged that K. D. Singh, a TMC Rajya Sabha MP and majority owner of Tehelka, was aware of and funded the entire operation. According to Samuel, the operation’s budget was initially set at $2,500,000 but was later boosted to $8,000,000. Singh, on the other hand, denied any involvement in the sting.
Role of the state government and CBI in the Narada Scam case (2014)
- Samuel was charged under numerous sections of the IPC, including Sections 469 (forgery to destroy reputation), 500 (defamation), 120(B) (criminal conspiracy), and others. On August 5, 2016, the Calcutta High Court issued an ad infinitum stay of the State inquiry, stating that the police cannot conduct a parallel investigation while a court-monitored investigation is ongoing. The Calcutta High Court directed the CBI to conduct a preliminary investigation on March 17, 2017. The Court further ordered the CBI to file an FIR against those engaged in the case. The State began disciplinary proceedings against SMH Mirza on March 18, 2017.
- The CBI filed a First Information Report against 12 Trinamool leaders for “criminal conspiracy” on April 16, 2017. Following that, the CBI called all of the leaders involved to help with the probe. They were all charged under Section 120 B of the Indian Penal Code, 1860 and Sections 7, 13 (2), 13 (1D) of the Prevention of Corruption Act.
- A parallel inquiry was being conducted by the Enforcement Directorate. It had filed a lawsuit under the Prevention of Corruption Act alleging theft of public funds and has issued many summonses to the accused and Samuel himself.
- As Members of Parliament were involved in the sting operation, a Lok Sabha ethics committee was formed to investigate if the individuals involved violated the house’s privileges. After the incident, the committee only met once.
- On May 9, 2017, West Bengal Governor Jagdeep Dhankhar sanctioned the prosecution of Subrata Mukherjee, Firhad Hakim, Madan Mitra, and Sovan Chatterjee, in response to a request from the CBI. “Honourable governor is the competent authority to accord sanction in terms of the law as he happens to be the appointing authority for such ministers in terms of Article 164 of the Constitution,” read a statement issued by the officer on special duty (communication), Raj Bhavan.
Cash for Vote Scam (2015)
- The 2015 cash-for-votes scandal was a political scandal, the second after the 2008 cash-for-votes incident. The 2015 political scandal began when Telugu Desam Party (TDP) leaders in Telangana were caught on tape offering bribes to a nominated MLA, Elvis Stephenson, in exchange for his vote in the Telangana Legislative Council elections in 2015. The Telangana Police detained TDP MLA Revanth Reddy as he was providing Rs. 50 lakhs to Stephenson. Reddy was then brought before the court and sentenced to prison. In a similar vein, a phone conversation between N. Chandrababu Naidu, the then-Andhra Pradesh Chief Minister, and Stephenson was broadcasted in the news media.
- The Telugu Desam Party said that the controversy was a political witch hunt orchestrated by the Telangana State Government, led by K. Chandrashekhar Rao, Telangana’s Chief Minister, and the YSR Congress Party. Revanth Reddy and two other co-accused were granted bail by the High Court of Judicature in Hyderabad for the States of Andhra Pradesh and Telangana due to a lack of sufficient evidence.
- The Telugu Desam party had begun damage control operations in response to the conversation’s repeated broadcast on television news networks. Chandrababu first travelled to Delhi to meet with prominent cadre leaders. They did not respond favourably, and the Central Law Minister stated that they would not intervene in this situation. Governor Narsimhan also went to Delhi to present a report on the situation. TDP Ministers and leaders were outraged by the move and began abusing the Governor, which became a heated topic of discussion. Meanwhile, the Telugu Desam had inflamed emotions and outrage across the State, claiming that this is a question of Andhra Pradesh’s honour and dignity.
- They spread propaganda that the Andhra people were not safe in Hyderabad and requested that Section 144 of the Code of Criminal Procedure, 1973 be enforced in the city, which was designated as a joint capital. To a degree, this was successfully communicated to the general public.
- The Chief Minister of Andhra Pradesh, Chandrababu Naidu, took this seriously as the issue had spread throughout the state. For several days, he spent his entire concentration on this problem, including meetings and reviews with higher-ranking police officers. He quickly fired Mrs Anuradha, the then-intelligence chief, for failing to obtain information regarding Telangana’s ACB plans. Following the arrest of Telugu Desam MLA Revanth Reddy in the Cash for Vote scam, news quickly spread that the major originator of this affair was Telugu Desam President, Chandrababu Naidu. Despite the fact that it was a party affair, Chandrababu treated it as a matter for the Andhra Pradesh government and dispatched government officials to deal with it.
Role of the executive agencies in the Cash for Vote Scam (2015)
The Enforcement Directorate (ED) had filed a charge sheet against Telangana Congress MP A Revanth Reddy, TRS MLA Venkata Veeraiah, and a few others as part of its money-laundering investigation into the alleged cash-for-vote fraud in 2015. A prosecution case (charge sheet) has been filed before a special court under the Prevention of Money Laundering Act, 2002 (PMLA), in Hyderabad’s Nampally, according to the central inquiry agency. In the cash-for-vote scandal, the case has been filed against Congress MP Anumula Revanth Reddy from Malkajgiri, MLA Sandra Venkata Veeraiah from the Sathupally constituency, Bishop Harry Sebastian, Rudra Sivakumar Uday Simha, Mathaiah Jerusalem, and Vem Krishna Keerthan.
Kerala Gold Smuggling case (2020)
- Customs agents at the international airport in Thiruvananthapuram, Kerala, confiscated gold weighing over 30 kg and valued at roughly Rs 15 crore on July 5, 2020. The gold was concealed in diplomatic luggage and addressed to the UAE consulate.
- Customs agents intervened after receiving information that the luggage was part of a smuggling ring attempting to use the name of a person with diplomatic immunity.
- After top administrator M Sivasankar became involved, the gold seizure turned into a major political crisis that threatened the foundations of Kerala’s ruling Left administration.
- He was suspended from service after his links with major accused Swapna Suresh were revealed. He was a former principal secretary to Kerala Chief Minister Pinarayi Vijayan and a former IT secretary. He was later arrested and released on bail.
- M Sivasankar has since published an autobiography in which he recounts his version of the infamous incident. He claims in his book that he made no criminal interventions in the gold smuggling case and that he never favoured Swapna Suresh unduly. He claimed he was taken aback when he learned she was involved in smuggling and that she had entangled him in the case. She has accused the senior officer of “manipulating, exploiting, and destroying” her life in return.
Timeline of events in the Kerala Gold Smuggling case (2020)
- June 30, 2020: A shipment of gold has been dispatched from Dubai to the UAE Consulate Admin Attache in Thiruvananthapuram.
- July 1, 2020: When the shipment arrives at the Thiruvananthapuram airport, customs refuses to release it. To open it, Customs writes a letter to the Ministry of External Affairs. On the same day, the UAE Consulate filed a Bill of Entry to clear the shipment.
- July 2, 2020: MEA writes to UAE Embassy for a no-objection certificate to open the consignment received.
- July 3, 2020: If the consignment cannot be released, the UAE Consulate Admin Attache demands that it be returned to Dubai.
- July 4, 2020: MEA sends a second letter to the UAE embassy, requesting a no-objection certificate, and is given permission to open it.
- July 5, 2020: In the presence of the Admin Attache, Customs examines the package and discovers almost 30 kilogrammes of gold. The gold in the package is not claimed by the Admin Attache. Customs keeps track of each instance. The home of the first accused, former Consulate PRO Sarith PS, is searched by Customs.
- July 6, 2020: Sarith gets summoned to the Kochi Customs office. His detention has been documented.
- July 10, 2020: The National Investigation Agency files a formal complaint to look into the terrorism element of the smuggling case.
- July 11, 2020: The NIA arrests Swapna Suresh and Sandeep Nair from Bengaluru.
- July 12, 2020: Mastermind Rameez KT arrested. ED registers a case to probe the money laundering aspect.
- July 14, 2020: Customs questions former principal secretary M Sivasankar in Thiruvananthapuram regarding his involvement in the case.
- July 23, 2020: The NIA questions Sivasankar in Thiruvananthapuram.
- July 27-28, 2020: Sivasankar was questioned at the NIA office in Kochi.
- September 11, 2020: Former minister K T Jaleel was questioned by ED in Kochi in connection with the Gold Smuggling case.
- September 16, 2020: Jaleel was questioned by the NIA in Kochi.
- September 25, 2020: CBI registers FIR regarding receipt of foreign funds for the LIFE Mission project
- October 7, 2020: ED files preliminary complaint against three accused persons.
- October 18, 2020: Customs registers case for smuggling of US dollars.
- October 26, 2020: Muvattupuzha native Rabins Hameed was deported and brought to Kochi by NIA.
- October 28, 2020: ED arrests Sivasankar after Kerala High Court dismissed his anticipatory bail plea.
- November 2, 2020: Vigilance registers case in LIFE Mission corruption incident.
- November 23, 2020: Customs arrests Sivasankar in a gold smuggling case.
- December 1, 2020: Sarith P S and Swapna Suresh, the accused in the case, deliver voluntary statements in front of a magistrate court.
- December 17, 2020: CM Raveendran, the Chief Minister’s Additional Private Secretary, appears before the ED for questioning.
- December 24, 2020: ED files charge sheet against Sivasankar.
- January 5, 2021: NIA files a charge sheet against 20 accused in the case.
- February 3, 2021: Sivasankar gets bail.
- March 17, 2021: The Crime Branch has filed a complaint against the ED for allegedly attempting to catch CM Pinarayi Vijayan and several ministers in a gold smuggling case.
- April 10, 2021: Customs questions former Speaker P Sreeramakrishnan.
- April 16, 2021: Kerala High Court quashes Crime Branch FIR.
- June 16, 2021: 53 people linked to the gold smuggling investigation have been issued a show-cause notice by Customs.
- January 6, 2022: M Sivasankar gets back in service, appointed as Principal Secretary Sports.
- February 3, 2022: Excerpts from Sivasankar’s upcoming book ‘Aswathamavu Verum Oru Aana’ have sparked a debate. Swapna Suresh, he claims, trapped him by giving him the iPhone.
- February 4, 2022: Swapna Suresh denies the allegations made in Sivasankar’s book about her, claiming that the two are close friends who had intended to settle down in Dubai.
Laws referred to in the Kerala gold smuggling case (2020)
- Section 3 of the Foreign Exchange and Prevention of Smuggling Activities Act, 1974: The provision provides that the Central Government or the state government or any officer of the Central Government, not below the rank of a Joint Secretary to that Government has been empowered to make orders detaining certain persons involved in smuggling of goods, or abetting to smuggle goods, or engaging in transporting or concealing or keeping smuggled goods, or dealing in smuggled goods otherwise than by engaging in transporting or concealing or keeping smuggled goods, or harbouring persons engaged in smuggling goods.
- Section 123 of the Customs Act, 1962: This provision states that the burden of proving that goods seized are not smuggled goods rests on the person from whose possession the goods were seized. Clause 2 of this provision provides that this Section shall apply to gold, watches, and any other class of goods which the Central Government may by notification in the Official Gazette, specify.
We have no doubt that corruption by greedy, power-hungry politicians, which is prevalent in many parts of the world, is one of the biggest issues and barriers to progress that many developing countries face. India, as Asia’s third-largest economy, must deal with the scourge of corruption and improve governance. Many distortions have been established by the political-economic regime. In the years since 1991, we have seen a significant shift; some of the earlier period’s flawed cultural norms are slowly being corrected by the absolute forces of competition. The process will take time and effort, and nothing will change quickly. We will undoubtedly construct a world of peace, growth, and prosperity if we begin nipping the corrupt forces in the bud by adhering to moral, spiritual, ethical ideals, and social responsibilities through formal education, training programmes, seminars, and other means.
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