Coal block corruption

BRP Bhaskar
Gulf Today

A Delhi special court last week asked former Prime Minister Manmohan Singh to appear before it next month, along with industrialist Kumar Mangalam Birla, to answer charges of conspiracy and impropriety in coal block allocations. Is this a case of upholding the majesty of law? Or is it one of judicial activism? Time alone can tell.

The coal scam came to light three years ago when the Comptroller and Auditor General reported that during 2004-09 the government had allocated coal blocks to various companies without competitive bidding. He estimated that the government’s inept handling gave the companies an estimated windfall gain of Rs10,673 billion. He later scaled down the figure to Rs1,856 billion.

The first Congress-led United Progressive Alliance government was in power at the time and Prime Minister Manmohan Singh himself was in charge of the Coal ministry for a while. Acting on a complaint filed by the Bharatiya Janata Party, then in the opposition, the Central Vigilance Commission directed the Central Bureau of Investigation to probe the matter. The CBI registered first information reports against a dozen companies and, apart from company officials, some officers, including Coal Secretary PC Parakh, were cited as accused.

Last year the Supreme Court ordered the setting up of a special CBI court to hear the coal scam cases and appointed a special prosecutor to conduct them. It also cancelled all but four of the 218 coal blocks allotted since 1993, covering the periods of Prime Ministers PV Narasimha Rao (Congress), AB Vajpayee (BJP), and HD Deva Gowda and IK Gujral (both Janata Dal).

The CBI was on the point of closing the case relating to Hindalco Industries Limited and its chairman Kumar Mangalam Birla when special court judge Bharat Parashar asked it to record the statement of Manmohan Singh, who was holding charge of the ministry when the company was allotted coal block. Accordingly, CBI officials interrogated him at his residence and filed a status report.

Former CBI director RK Raghavan said the judge’s order reaffirmed the position that a Prime Minister – in office or outside – had no immunity from criminal prosecution. That a Prime Minister is not above the law was established years ago when Narasimha Rao faced three criminal cases, all of which were conducted by the CBI. Trial courts acquitted him in two cases for want of evidence. In the third, relating to bribing of MPs to buy support for his minority government during the voting on a no-confidence motion, the trial court found him guilty and sentenced him to three years’ rigorous imprisonment and a fine of Rs100,000. On appeal the high court set aside the conviction.

While the principle of supremacy of law has thus been asserted, there is room to doubt the reliability of the legal processes.

Created in 1963, the CBI traces its origin to the Special Police Establishment which India inherited from the British regime. It established an early reputation with its success in some sensational cases in which the role of the state police was suspect. However, in sensitive cases, like the Bofors scandal of Rajiv Gandhi’s time, it too failed miserably.

In 2013, on finding that the CBI had amended a coal block case affidavit at the instance of the Law Minister, Justice RM Lodha of the Supreme Court dubbed it “a caged parrot”. The court thereafter took certain steps to help it to function without political interference. However, few believe it is now a free bird.

There is something curious about the coal block cases. The CAG only accused the government of inefficiency. He did not allege corruption.

The conspiracy charge levelled against Manmohan Singh rests on the CBI report about a meeting between him and Birla before his firm was allotted the coal block. Neither the CAG nor the CBI has suggested that Manmohan Singh derived financial benefit from the allocation or that there was any quid pro quo.

Former Confederation of Indian Industry president Adi Godrej expressed surprise at the citing of Manmohan Singh and Birla as accused on the basis of their meeting. “It is not uncommon for senior industrialists to meet a minister or even the Prime Minister when an important matter needs to be discussed,” he said in a television interview. “If you keep summoning everybody as an accused, businesses will get disheartened and wouldn’t want to invest in the country.” --Gulf Today, March 17, 2015.

Not playing by the rules

BRP Bhaskar

Gulf Today

 

The joint parliamentary committee (JPC) probing the 2G scam has run into a stalemate. The chief of the Central Bureau of Investigation has admitted to sharing with the political executive a progress report on the coal scandal probe which was prepared on a Supreme Court directive. Parliament has transacted little business in recent days with the opposition Bharatiya Janata Party stalling the proceedings demanding Prime Minister Manmohan Singh’s resignation on the issue of interference in the coal scam investigation.

All these indicate that the government and the opposition are not playing the game according to the rules.

The JPC was set up to look into allegations of corruption in the allotment of 2G spectrum. Several criminal cases in connection with the scam are under investigation or prosecution, and the accused include A Raja, a former minister belonging to the Dravida Munnetra Kazhagam, and several senior officials.

JPC chairman PC Chacko recently circulated a draft report which pins the blame solely on Raja and absolves the Prime Minister and the Finance Minister who were apparently aware of his actions. To beat Chacko’s plan to push the draft through the committee, which is equally divided, with his casting vote, the opposition members have written to Lok Sabha Speaker Meira Kumar saying they have lost confidence in him and asking that he be removed. To gain majority in the committee, Congress members have asked her to disqualify three opposition members citing conflict of interest. 

The JPC mechanism was first tried in 1987 when Rajiv Gandhi’s government faced allegations that the Swedish company Bofors had paid $12 million in kickbacks to secure an order for howitzers. Opposition members pulled out of it saying the chairman, B. Shankaranand, was acting in a partisan manner.

Alladi Aruna, of the All India Anna Dravida Munnetra Kazhagam, which was then an ally of the Congress, stayed on and added a dissenting note to the committee’s report. He said later that Congress members were engaged in a cover-up effort. They did not follow the procedures properly and denied members enough time to study the documents.

The JPC failed to identify the beneficiaries of Bofors payments. The Central Bureau of Investigation, which probed the matter, too could not find them. Ottavio Quattrocchi, an Italian businessman and friend of the Gandhis, whose name came up during the investigation, slipped away.

Between 1992 and 2003 there were three more JPC probes, all into irregularities in the financial market or the commercial sector. Since no member of the government was under the scanner, the committees could complete their work without any hitch. However, there was no meaningful follow-up action.

The 2G JPC has generated more acrimony than any previous probe. Raja offered to testify before it but Chacko turned down the offer. Chacko also rejected the BJP members’ suggestion to summon the Prime Minister and the Finance Minister.    

The poor record of JPCs notwithstanding, political parties still demand setting up of such committees when allegations come up. A proposal to set up a JPC to probe reports of kickbacks in the Agusta Westland helicopter deal, approved by the Rajya Sabha, is awaiting the Lok Sabha’s concurrence.    

CBI director Ranjit Sinha’s admission, in a sworn affidavit, that the agency had shown Law Minister Ashwini Kumar and senior officials of the Prime Minister’s office and the Coal Ministry a report on the progress of the coal scandal investigation before it was submitted to the Supreme Court may prove more troublesome to the government than the confrontation with the opposition in the JPC.

In this investigation, the Coal Ministry is in the position of a suspect since what is being looked into are its alleged wrongdoings. Sharing of the report with officials of the ministry was, therefore, an act of gross impropriety. Since Manmohan Singh personally handled the Coal portfolio at one stage his office’s interest in the investigation cannot be viewed as innocuous.

Sinha’s affidavit does not say whether the agency made any changes in the report at the instance of those who were shown it.  The court is not likely to overlook his silence on this crucial aspect.

The Supreme Court has been keen to ensure that the CBI has functional autonomy, especially in dealing with cases involving members of the political executive. An adverse finding by it on its handling of the coal probe report can have far-reaching consequences. --Gulf Today, Sharjah, April 30, 2013.

An eye to the 2014 poll

BRP Bhaskar
Gulf Today

With the Congress party in deep trouble, foes are getting ready for the kill and friends are charting their own separate courses with an eye to the parliamentary elections, which is due in 2014 but can come sooner. The Samajwadi Party, which supports the government from outside, is exploring the possibility of reviving the third front.

The Congress-led United Progressive Alliance, now in the latter half of its second five-year term, has been assailed by one scandal after another in the last two years. Just as it was sighing with relief over the split in Anna Hazare’s team, which had brought corruption to the top of the nation’s agenda, a scandal relating to coal mining contracts made headlines.

The coal scam, like the scandal relating to allocation of second generation (2G) spectrum, was brought to light by the Comptroller and Auditor General, the constitutional authority mandated to scrutinise government accounts. The CAG estimated that allotment of mining licences without auction had resulted in a loss of Rs1,830 billion to the exchequer. That made ‘Coalgate’ bigger than the 2G scam in which the loss was put at Rs1,766 billion.

The Congress was able to shift the focus in the 2G scam to the Dravida Munnetra Kazhagam of Tamil Nadu, its second largest partner in the UPA, as its nominee, A Raja, was the Communications Minister during the relevant period. The opposition could only charge the Congress and Prime Minister Manmohan Singh with failure to rein it in. Raja and Kanimozhi, MP and daughter of DMK chief M Karunanidhi, are now facing corruption charges in a court, along with some senior officials.

In the present scandal the spotlight is on the prime minister as the coal ministry was in the hands of the Congress party throughout and Manmohan Singh himself was in charge for some time. The Bharatiya Janata Party has stalled the proceedings of both houses of Parliament for more than a week demanding the prime minister’s resignation. It has turned down the government’s offer to discuss the CAG report in Parliament and vowed to carry the fight into the streets.

The procedure laid down in the Constitution provides for scrutiny of CAG reports by Parliament’s Public Accounts Committee. Any discussion in Parliament or action by the government on the report can only come after that. This procedure has been derailed on a few occasions since the CAG report on the corruption in the deal with the Swedish arms dealer Bofors for purchase of howitzers when Rajiv Gandhi was prime minister.

The combined opposition was able to force a probe by a joint parliamentary committee into the Bofors deal and the Central Bureau of Investigation conducted criminal investigation for years but no one could be brought to book. TN Chaturvedi, the CAG who produced the Bofors report, later became a BJP member of Parliament. Some observers believe Coalgate may go the Bofors way.

As in the case of the 2G scam, the Congress party’s first response to the CAG report was to deny there had been loss of revenue. Later a party spokesman accused the CAG, Vinod Rai, of harbouring political ambitions.

With opinion polls indicating that the Congress is going downhill and that its own fortunes are improving, the BJP is trying to force the government to quit and clear the way for early elections. With this end in view it is considering the possibility of mass resignation of opposition MPs. What is holding it back is the reluctance of some of its National Democratic Alliance partners to go the whole hog with it.

At one stage, the Congress itself was considering the possibility of early parliamentary elections as the drought spell in some parts of the country is likely to add to its difficulties later on. Its leadership, however, appears to be in a state of paralysis. It has not been able to take any meaningful steps to refurbish the image of the party and the government ahead of the elections.

The opinion polls show that as things now stand the BJP can hope to replace the Congress as the largest single party in the NDA as the largest single pre-poll alliance. But the indications are that they are getting only a part of the voters who are deserting the Congress. The bulk of them are moving towards the smaller national or regional parties. However, revival of the third front will not be easy. The Communist Party of India-Marxist, which played the midwife under similar circumstances in the past, is no longer in a position to do so. --Gulf Today, September 4, 2012.