National Magazine | Aug 20, 2007
Irfan Hussain
Scandals
Sixty Years On, More Sinned Against...
The great political scams of the last 60 years reflect their times,
but also fit a timeless definition of corruption: abuse of public
power for private gain. A trip down murky memory lane.
Smita Gupta
Special Issue: India At 60
The great political scams of the last 60 years reflect their times,
but also fit a timeless definition of corruption: abuse of public
power for private gain. They rolled out decade after decade—the
Mundhra scandal, the Kairon embarrassment, the mysterious Nagarwala
case; in the 1980s, big defence scams kept pace with India's growing
defence needs. In the 1990s, as the economy liberalised, stockmarket
and hawala scams erupted. Ironically, while political reputations were
ruined and a government was brought down—in 1989, on the Bofors issue—
very few allegations have ever been proved. The recent scandals, like
the Taj Corridor case involving Mayawati, and the Telgi fake stamp
paper scam, are still fresh in the public mind. Here, we take you on a
trip down murky memory lane.
***
The Mundhra Scandal
The timing was disastrous. Less than a year after the government
nationalised life insurance in 1956—on the grounds that it was not
being managed well—the Life Insurance Corporation (LIC) produced
independent India's first scam. Pressured by the Union finance
ministry, LIC bypassed its investment committee and purchased shares
worth Rs 124 lakh in six—mainly dud—companies belonging to Calcutta
industrialist Haridas Mundhra. Feroze Gandhi, Prime Minister
Jawaharlal Nehru's son-in-law, dramatically disclosed the deal in
1958, leading to a nationwide furore, and an investigation. The guilty
were punished, and Union finance minister T.T. Krishnamachari had to
resign.
Kairon and Sons
For independent India, this was a first-of-a-kind scandal. Later, of
course, it was to become almost a cliche in political life: a chief
minister accused of aggrandising himself and his family at public
expense. The S.R. Das Commission, tasked to investigate these charges
against Punjab chief minister Pratap Singh Kairon, exonerated him in
1964, saying a father could not be held legally responsible for the
actions of his grown-up children. But a caveat—that a chief minister
could not escape moral responsibility for his children's' actions—was
indictment enough. Kairon quit.
"Man from Bangladesh"
The case, straight out of a political thriller, captured public
imagination and continues to raise unanswered questions. On May 24,
1971, former intelligence agent R.S. Nagarwala, posing as a "man from
Bangladesh", withdrew Rs 60 lakh from the Parliament Street branch of
New Delhi's State Bank of India, following a purported call from then
prime minister of India, Indira Gandhi, to the chief cashier.
Nagarwala had apparently "mimicked" Indira Gandhi's voice. In the
course of the probe that followed, investigating officer D.K. Kashyap
was killed in a mysterious car accident and Nagarwala died in prison.
The Janata Party, alleging that the money belonged to Indira Gandhi,
set up the Jaganmohan Reddy commission in 1977, but found insufficient
evidence to indict her.
"Rajiv Gandhi chor hai"
"Gali gali mein shor hai, Rajiv Gandhi chor hai!" As the scandal over
the Bofors gun deal became a symbol of corruption in high office, this
slogan was heard across the country. The alleged kickback involved was
Rs 60 crore, small change as such scandals go, but it helped V.P.
Singh's National Front trounce Rajiv's Congress in 1989. Since then,
the Delhi High Court has acquitted Rajiv Gandhi and the Hinduja
brothers. 'Middleman' Ottavio Quattrocchi's name has not yet been
cleared, but investigators have not come up with anything conclusive
either. Yet, 18 years later, the ghost of Bofors continues to haunt a
forever tainted Congress—and Rajiv Gandhi's widow, Sonia.
St Kitts Forgery Scandal
Chandraswami, a godman with greasy locks and mighty political
connections, was the central figure in the 1989 tit-for-tat "scam"
intended to tarnish V. P. Singh. He, along with then external affairs
minister, P.V. Narasimha Rao, and another minister, K.K. Tewary,
reportedly organised forged documents to show that VP's son Ajeya
Singh had deposited $21 million in the First Trust Corporation Bank in
the Caribbean island of St Kitts, with his father as beneficiary.
After Rao's term as PM ended in 1996, the CBI formally charged him for
the crime. But later, the court acquitted Rao for lack of evidence.
All the other accused were also eventually let off. However, the scam
punctured Chandraswami's colourful career. Politicians kept clear of
him from then on.
Sukh Ram Telecom Scam
He came to be known by the epithet, minister of tele-'phony'. In 2002,
a CBI special court sentenced former Union communications minister
Sukh Ram to three years RI, and fined him Rs 1 lakh for purchasing
poor quality radio system equipment from a company in 1991, causing
the public exchequer to suffer losses totalling Rs 1.68 crore. The
buzz was that Sukh Ram, under whose bed dhobi bundles of cash were
found, was involved in several other deals, but nothing was proved. A
senior telecom official, Runu Ghosh, and Hyderabad-based businessman
Pataru Rama Rao, were also sentenced to two and three years
imprisonment respectively. A tortuous legal battle continues.
Stockmarket Scam, 1992
He was toasted and celebrated by investors and the media alike. But
like the stockmarket, he too crashed, leading to one of the biggest
financial scandals in independent India. 'Big Bull' Harshad Mehta,
held to be largely responsible for the stockmarket crash of '92, was
arrested by the CBI in November that year for "misappropriating" more
than 27 lakh shares—worth Rs 250 crore—of about 90 companies,
including Sensex heavyweights like ACC and Hindalco, through forged
share transfer forms. Blacklisted in the stockmarket, he reportedly
caused a loss of more than Rs 4,000 crore to various entities and
eventually died in custody in December 2001, before all the legal
issues were sorted out. The stock scam reverberated through the
country, with several people committing suicide after losing their
life savings and going bankrupt overnight.
PV in a Pickle
Close on the heels of the stock scam came Harshad Mehta's sensational
allegation that he had paid Rs 1 crore in cash to the personal
secretary of then prime minister Narasimha Rao. He even displayed a
suitcase, offering a symbol for venality, but the allegation was never
proved. Rao was also embarrassed by the Lakhubhai Pathak cheating
scandal. Pickle king Pathak, a UK-based Indian businessman, alleged
that he had paid Chandraswami and his associate K.N. Aggarwal alias
Mamaji (who were close to Rao) $100,000 in return for a paper pulp
supply contract in India, a "promise" that was not kept. Rao and
Chandraswami were acquitted of the charges in 2003 due to lack of
evidence. Despite this, the case remained a blot on Rao.
Jain Hawala Scam
Some of the country's leading politicians were implicated in the Rs 64-
crore hawala scandal, involving payments allegedly received by
politicians through the Jain brothers, who were hawala brokers. The
media went into overdrive over a diary, which apparently contained the
names of top politicians. These included the BJP's L.K. Advani and
Congressmen Balram Jakhar, Madhavrao Scindia and Arjun Singh. However,
they were all cleared. Advani was let off in 1997, while Jakhar and
the Jain brothers were also let off in 1999 for want of credible
evidence. The CBI was severely criticised for its inefficient
investigation of the scandal.
Fodder Scam
In 1996, Bihar CM Laloo Prasad Yadav became the focus of the Rs 950-
crore fodder scam in the state's animal husbandry department,
notorious for financial irregularities involving powerful politicians
(across parties) and officials. In April 2000, Laloo was chargesheeted
in the case, with wife Rabri Devi as co-accused. In December '06, they
were acquitted, but the CBI and the Bihar government, now under the
JD(U)'s Nitish Kumar, opposed the decision in the Patna high court.
Till date, 250 persons have been convicted. But the scandal's severest
toll has been on Laloo's reputation.
Petrol Pump Scam
Shortly after the NDA came to power in '98, the BJP was quick to prove
it was not "a party with a difference". By '02, it was evident that
most petrol pump, LPG and kerosene allotments during the NDA regime
had favoured BJP functionaries, Sangh activists and selected governors
and bureaucrats. Then prime minister A.B. Vajpayee was forced to
cancel all 3,158 allotments, with effect from January 2000. However,
the SC quashed the order. In 2005, an apex court-appointed panel
recommended that 296 of the 409 allotments be cancelled.
Operation West End
Tehelka.com sent shockwaves throughout the country when it released
secret video footage of senior politicians, including then BJP
president Bangaru Laxman and Samata Party national president Jaya
Jaitly, bureaucrats and army officers accepting bribes for defence
deals. This was the first major sting operation in Indian journalism.
From then on, getting 'Bangarued' came to mean being caught with your
hand in the till. The scandal forced Bangaru and then defence minister
George Fernandes to resign. The CBI filed charges against Bangaru and
two of his aides in July '06 and against Jaitly in December '06.
Chargesheets were also filed in 2006 against some of the other accused
in the Union ministry of defence and the army. R.K. Jain, former
treasurer of the Samata Party, was finally arrested in 2006 on charges
of receiving huge payoffs in defence deals.
Bu Smita Gupta with Debarshi Dasgupta
Aug 17, 2007 12:00 AM
22 Gulam:>>" Who are "we" here?
All those involved in fighting the terrorists."
All those now involved in 'protecting/training' the terrorists should
also sincerely join the fight against terrorists and their
...
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