Political System is Hostage to Racketeers

by Madhu Limaye

In a scarcely noticed address to the 12th Joint Conference of the CBI and State Anti-Corruption Bureau Officers on October 20, 1994 the Prime Minister, P.V. Narasimha Rao, called for “a multi pronged action plan to tackle the menace of corruption”. He assured the Enforcement Agencies that “all legislative and administrative measures would be taken to help them tackle the corruption problem”. In view of the fact that this plague of corruption is the single greatest obstacle to rapid economic development and reform of the political system, it is hoped that the investigation into the scandal exposed in this article and speedy action thereon would receive the Prime Minister's special attention. It would be a test of the integrity of the top leadership.

We have celebrated the 125th Birth Centenary of the Father of our Nation. Is it not appropriate to pause and reflect on the distance the country has travelled away from the ideals he had laid down for us since his death 46 years ago? He taught us the virtues of cleanliness and public hygiene. He tried to inculcate in us the much-needed civic sense. But we neglected his teaching. We allowed our villages, towns and cities to go to seed. Garbage heaps piled up everywhere, even in posh colonies. The slums became a veritable hell. Now the dreaded plague, which even for people of my generation was only a childhood memory, has overtaken us. Mahatma Gandhi also laid the greatest stress on probity in public life. He insisted on accountability and had warned us about the incipient danger of corruption, when it was really no bigger than a barely visible speck. Now corruption has enveloped the entire national life and will have more fatal consequences than the new plague. The seizure of the Jain diaries should have created an unprecen-dented furore, because it uncovers a rot in the system more serious than that revealed by the Bofors exposure. But unfortunately we have become as used to this terrible scourge of corruption as the garbage heaps in our cities. I think it necessary to state the stark facts relevant to the issue.

On March 25, 1991 one Ashfaq Hussain Lone, alleged to be the Deputy Chief of Hizbul Mujahadeen Intelligence, was arrested at Jamat-e-Islam at Chitli Qabar, Delhi. Bank drafts and cash were seized. The source of the money was one Dr Mohammed Ayub in London. A JNU student, Shahabuddin Ghauri, and seven Hawala dealers were arrested in the next two or three months. The clues led to further raids. In the words of the CBI:

On 3.5.1991 searches were conducted simultaneously at twenty places including the business and residential premises of the said J.K. Jain. The business and residential premises as well as the farm house of one S.K. Jain, the employer of the said J.K. Jain, were also searched. The unaccounted cash in a sum of Rs 93,52,755, foreign exchange worth Rs 3,69,307, Indira Vikas Patra worth Rs 10,50,000 and gold bars weighing 4430 kgs were recovered from five different places during the said searches. Unaccounted cash in a sum of Rs 58,09,100, Indira Vikas Patra for Rs 10,50,100 and foreign exchange—namely, 593 US dollars, 300 UK pounds, 2700 Dutch marks, 50 Hong Kong dollars, 300 francs and 50 unknown currencies—were also recovered from the house of the said J.K. Jain. Some diaries and figures were also recovered from the house of the said J.K. Jain.

When the investigation into this was virtually closed and charge-sheets were framed against Lone and Ghauri, no reference was made to the seizures of May 3, 1991 and their significance. There was no question of taking action against the Jains. The CBI really intended to hush up the matter, which it thought was politically explosive. The publication of the details of the material seized at the premises of the Jains revealed violation of the several laws of the land, and yet the CBI had failed to take effective and expeditious action in national interest. The CBI officer, O.P. Sharma, and Vijay K. Rama Rao, Director of the CBI, should be obliged to explain why no thorough investigation has been carried out into the activities of the Jains. From the notings of the CBI officers concerned it appeared that between April 1988 to March 1991 vast sums, received from sources abroad, were disbursed by the Hawala racketeers. The beneficiaries were Kashmiri terrorists, politicians, bureaucrats and others whose identity could be easily established through “custodial investigation to which any accused in the situation of the four Jains would normally be subjected”. Every case of non-enforcement of law in matters of corruption is an act of “discrimination and arbitrariness” and violative of Article 14 of the Constitution.

The Jains were raided on May 3, 1991. Although more than three years have passed, the CBI has not been able to clinch the matter. Can anything be more damaging? Contrast the speedy and efficient manner of the CBI inquiry into the Allahabad High Court happenings under the”lash” of the Apex Court and we see the difference. The task of deciphering the entries and identifying the persons is not all difficult. Even an inexperienced layman of average intelligence can do it. In fact the identities of the persons and the payment received have already been established. The highlights are as under:

Politicians1

Bureaucrats2

Business3

List of Politician Recipients (Amount less than Rs 20 lakhs)

List of Bureaucrat Recipients (Amount less than Rs 20 lakhs)

Footnotes

1. Round Figures. Only those who received Rs 20 lakhs or more are mentioned.

2. It is not without significance that the Jains, who apart from being Hawala racketeers, have been engaged in power and construction activities and so the then Power Minister and officials connected with the Central and Madhya Pradesh Power Departments have been the object of their special attention. Arif Mohammad Khan, close Jan Morcha colleague of V.P. Singh, who as the Prime Minister gave him two important portfolios, including Power, received the largest amount among the politicians, that is, Rs 7.5 crores. Arun Nehru, Madan Lal Khurana, Arjun Singh and others have not been listed above because their receipts were less than Rs 20 lakhs each.

3. Among the bureaucrats, there are in addition to those in the above list, a dozen officials of the Central and Madhya Pradesh Power Departments, National Thermal Development Corporation and Central Electricity Authority who have received money from the Jains, but their names have not been mentioned because the amounts received were less than Rs 20 lakhs.

The CBI has had recourse to evasion, half-truths and prevarication in the face of certain irrefutable facts. It has admitted that S.K. Jain has “to some extent explained what the coded entries pertain to”. But it says that corroboration of the identities of persons has not yet been obtained by “independent evidence”. It has also stated that S.K. Jain had “taken the plea that the said payments were made from the proceeds of black money generated in his company”. But there is no mention that the Income Tax and other agencies were brought in to expose this blatant lie. The diaries, notebooks, etc. contain other information, but the correctness of the already decoded names and the sums paid have not been contradicted by the CBI. How serious and efficient the CBI was is clear from its own admissions!

It says:

Efforts were made to interrogate S.K. Jain and J.K. Jain in early part of 1993 who avoided to appear before (p. 45) the CBI and also went abroad. Their presence could, however, be secured in the month of July 1993, for the purpose of investigation. When they further avoided joining investigation, a look out notice was issued against them in the month of September 1993, as a result of which their presence could be secured through the immigration authorities of Delhi for their interrogation in the middle of September 1993 onwards…..

Verification of their statements was thereafter, it is claimed by the CBI, taken up “vigorously” which is still continuing.

The ramifications of the Hawala financiers from the Kashmiri terrorists to leading Indian politicians and bureaucrats make one freeze with amazement. The Executive of this country—its political arm (Ministers), bureaucracy (a serving Secretary is implicated), and its intelligence wing—the RAW Chief Bedi, who retired in 1993, and Vijay Karan, then boss of the CBI, were themselves involved—are devoid of all conscience and wallow in corruption. The President of the BJP, L.K. Advani, who loudly talks of an uncompromising fight against Kashmiri terrorism, himself accepts subversive funds. V.P. Singh had said on several occasions that members of his government were not involved in corruption. Apart from Devi Lal and Arif Mohammad Khan, who received vast sums, especially the latter, Arun Nehru and Sharad Yadav also have received tainted money. Yadav has at least admitted the fact. V.P. Singh, however, is dumb like a doll on this issue. Only the names of George Fernandes, Madhu Dandavate—Socialist Ministers—and the CPI and CPI-M leaders are not there in the Jain Diary.

It has become a common practice to blame Pakistan for our ills. Pakistan is without doubt doing everything in its power to destabilise the Indian state. But the Enemy is Within. I therefore think that ruthless action against all those involved in these shady transactions will help cleanse the rot in the Indian political system and other departments of national life.

(November 12, 1994)

Note: After this article appeared in this journal only former CBI chief Vijay Karan, in a communication, explained that the initials “VK” figuring in the Jain diaries did not pertain to him; and this was unequivocally confirmed by the then Solicitor-General Dipankar Gupta, as well as the CBI (in a press note). This communication was published in the January 7, 1995 issue of Mainstream. (Incidentally Madhu Limaye passed away in New Delhi on January 8, 1995.) However, the other personalities, named in the aforementioned article, did not react. —Editor