The Taming of the Sleuths

In spite of corralling evidence against the accused in high-profile cases, the CBI seems reluctant to file charges. Can it wrest control from its political masters?

Sadiq Naqvi Delhi 

Recently, the Central Bureau of Investigation Director Ranjit Sinha ordered an inquiry against his own officials. He was upset after a team that had raided the residential premises of Neeraj Singhal, Vice President of Bhushan Steel, didn’t arrest him, despite Sinha’s explicit orders. Singhal was in the CBI’s crosshairs after the apex investigating agency exposed the CMD of Syndicate Bank, SK Jain, accepting a bribe to settle a loan that Bhushan Steel had borrowed from the bank. Jain was promptly arrested. His appointment is also under review, while officials from the Finance Ministry may come under a probe for a possible mala fide element in Jain’s appointment to the bank’s top job.

The high profile arrest is just one among 27 cases that the CBI is probing against banks and private firms that have been sitting on bad loans of Rs 70,000 crore. Jain’s prompt arrest was possible after the recent Supreme Court verdict that struck down the earlier mandatory provision of seeking prior government sanction before arresting any official of a rank of joint secretary and above. Meanwhile, Singhal, too, was nabbed later on Lodhi Road, less than a mile away from the agency’s headquarters. This sense of urgency has only arrived after the new government took over.  

Does this mean the caged parrot—the Supreme Court’s epithet for the agency handling the coal scam probe—is flying free again? One sparrow does not make a summer, and surely it would make little sense to read too much into the Syndicate Bank case. But there are several high profile cases where, after the initial excitement, the investigating agency has been somewhat shy to take the case forward.

CBI ambivalence towards these cases is not just due to the inability to find clinching evidence, but the way its resolve is routinely broken by political influence or persuasive powers of the fixers that abound in the capital.

A case in point is Moin Qureshi, whose networks and proximity to the CBI bosses, including Sinha, were used to allegedly bend investigations to suit corporate houses that had been probed for their involvement in scams. There are horror stories of the CBI top brass allowing key accused in many scams to breathe easy.

Despite attempts by SC to free the CBI and allow it to live up to its motto of “industry, impartiality and integrity”, the agency has been succumbing to pressure from not just political masters, but corporate interests, as well.

It was during the Jain Hawala scandal of 1996 that the SC decided to lay down rules to ensure the agency was made immune to political interference. The CBI chief was given a fixed tenure of two years and was expected to report to the Chief Vigilance Commissioner. Save for security of tenure to the chief, the other points pertaining to CBI’s independent functioning have come a-cropper.

One reason for the de-legitimisation of the Congress-led UPA government was the rise in the number of mega scams and CBI’s inability to investigate with independence. When people stepped onto the streets, they were not just demanding the ouster of the government, but also for an agency that would not kowtow to political pressure. The CBI was rudely dubbed the Congress Bureau of Investigation. The BJP was at the vanguard of the attack against Congress, as it was coming to grief due to the probe into Hindutva terror. However, the loudest noise was made by India Against Corruption (IAC), which wanted the appointment of a Lokpal so that the political executive had no say in matters of investigation and prosecution. The agitation for the establishment of a Lokpal and Congress’ agreement to a watered-down version is now history, but what is still not clear is how the CBI will conduct itself in the new political environment. Will the agency be freer now than in its poodle-of-the-Congress days? These questions acquire urgency, as the CBI is probing cases that involve key figures in the current dispensation. The manner in which they handle these cases will go a long way in establishing the credibility of the agency. Does it have the resilience to freely investigate cases where crime is driven by ideology and a different interpretation of national interest?

After all, the CBI is not tasked with investigating malfeasance of bank officials alone, but also concerned with crimes that impact the unity and integrity of the country.

In recent years, though, the CBI has been saddled with investigations that disturbingly weave in the criminal nexus between politics and business. Take the example of the investigations into the multi-billion rupee coal block allocation scam. The Central Vigilance Commission, which stepped in after the SC asked it to go through the clean chits that had been doled out in abundance, asked the agency to register FIRs in at least 14 cases, out of the 64 that it had studied in detail. As many as 250 closed preliminary enquiries (PE) were being analysed by the CVC. CBI insiders say many more such FIRs could be registered. The firms that got relief include TATA, the Aditya Birla Group, Reliance, and SKS Ispat. Sources say that while the CVC did not dispute closing cases against TATA, Birla and Jindal, approval wasn’t so forthcoming when it came to Reliance and the blocks that it secured in Sasan, in Singrauli. However, Anil Ambanis’ Reliance got away in the 2G scam despite serious questions about its role. After the CVC’s intervention, the CBI has registered four more FIRs, which include those against Pramod Kumar Gupta, former Corporate Affairs Minister and a close aide of Lalu Prasad Yadav, and against SKS Ispat, the firm which allegedly is a front for former cabinet minister Subodh Kant Sahay.

In most of these cases, we find that recommendations from investigating officers were turned down by seniors. “There is a need for an investigation to find out how CVC and the Court found the investigations faulty. The guilty officials need to be punished. There is a grave need to go into the details of the investigations and find out how these clean-chits were given if the investigations said otherwise,” says a finance ministry investigator.  

It will be foolhardy to blame the CBI for all the flip-flops in the investigations. The previous government, too, was withholding details that the CBI could pursue. The most glaring instance of interference came to the fore when it was found that then law minister Ashwini Kumar had asked Ranjit Sinha to see him with the report on the coal scam case before it was submitted to the Court. It is widely believed that changes were made to the report in this incident, which even led to Kumar’s resignation. It was this case that led the SC to comment that the CBI was a caged parrot.

The CBI also ran into difficulty questioning the officials of the PMO and the coal ministry. The government was not very keen on sanctioning the questioning of the then Coal Secretary HC Gupta and senior PMO official TKA Nair. It was only the SC’s intervention that allowed the CBI to proceed with its investigations.

Noted Supreme Court lawyer Prashant Bhushan says the CBI has an atrocious record. “Apart from political pressure, which they succumbed to in the case of Mulayam Singh and Mayawati, they also appear to be amenable to monetary inducements,” he remarked. In the Mulayam Singh disproportionate assets case, the CBI found sufficient material in its preliminary inquiry, but later did a U-turn after the law ministry’s intervention. Similarly, in 2004, Mayawati got reprieve in the Taj Corridor scam and the DA case after intervention from the director of prosecution. The file was sent to the attorney general at the time for advice, and, as expected, he relied on the view of a law ministry official—OP Verma—to suggest that Mayawati should be given benefit of doubt. Even in the 2G scam, former CBI chief AP Singh was reluctant to press charges in the Essar-Loop spectrum allotment after the director of prosecution and former law minister Salman Khurshid pleaded that no case was being made out. It was only after an intervention by the Supreme Court and the attorney general that the case was filed, albeit without invoking the Prevention of Corruption Act, which would have made it difficult for the offenders to secure bail.      

However, this is not the first time that the CBI and the CVC are at loggerheads. Recently, the CBI chief opposed the appointment of RK Pachnanda as the agency’s Additional Director, despite a go-ahead from the CVC and the CCA. Sinha favoured Archana Ramasundaram, another officer, who was eventually appointed instead of Pachnanda. The matter went to the apex court, where recently Pachnanda chose to opt out of the appointment brouhaha to ‘protect his rights and reputation’. He had claimed that his service record may not be represented correctly. Sinha had recounted an earlier instance to the court, where Pachnanda was not deemed fit to be posted to the elite Special Protection Group on account of his service record. 

However, the appointment led to a tiff between the Centre and the J Jayalalithaa-led government in Tamil Nadu, Ramasundaram’s parent cadre. The TN Chief Minister had suspended Ramasundaram after alleging that she had deserted her duties to the state and taken a posting without getting relieved of her duties. The new Attorney General, Mukul Rohatgi, has recently opined that Ramasundaram be transferred back to the parent cadre to lower the tensions between the Centre and the Tamil Nadu government. The SC also observed that, prima facie, her appointment was not done according to the laid-down procedures.         

Meanwhile, not too long ago, the CBI faced stiff opposition for its handling of the IshratJahan case. Things came to a boil after the CBI, in its chargesheet, named senior Intelligence Bureau official Rajinder Kumar. Said to be very close to then chief minister Narendra Modi and home minister Amit Shah, the CBI alleged in its chargesheet that Kumar was involved in the fake encounter where Jahan and three others, including Javed Sheikh and two Pakistani nationals, were gunned down on the outskirts of Ahmedabad in June 2004. It was alleged that Jehan was anLeT terrorist out on a special mission to kill Modi. The mention of Kumar’s name in the chargesheet led to a full-blown confrontation between the IB and the CBI—so much so that Asif Ibraheem, the IB chief, came out in support of his colleague and accused the CBI of targeting the intelligence agency. The Home Ministry too appeared reluctant to sanction the arrest. However, Sinha appeared defiant, which led many to believe that the agency might arrest the former officer. It was only after the previous Rajya Sabha opposition leader Arun Jaitley alleged that the CBI was unfairly targeting IB officials under government pressure to fix Modi and Shah that the CBI chief retracted from his tough stance.

“We could well have arrested Kumar, but we have not done so. We allowed him to retire with full pension. Hence, we have been more than considerate to the IB officers,” Sinha told a newspaper. He went on to suggest that had the IB officers been discreet in the crime, they would have been let off. “The whole operation, carried out jointly by Gujarat Police and IB, was botched up, and the IB officers did it in a slip-shod manner and never covered their tracks,” he had said. Sinha, in his statement, also suggested that the CBI did not delve deep into the role of the home ministry officials who may have known of the encounter so as to ensure that it would not “breach the glass ceiling”.

The confusion doesn’t stop with Kumar; many did wonder how Amit Shah got away without being charged in the IshratJahan encounter. Now it seems CBI had little evidence to prosecute him. Shah, who is facing charges in two other encounter cases, was under suspicion after a senior police officer, GL Singhal, submitted telephonic conversations between him and Shah that could pin down his role in the killings. It emerged that safed dadhi and kali dadhi (white beard and black beard) in the conversation was a reference to Modi and Shah. Another police officer DG Vanzara is also known to have used the same term, in another taped telephonic conversation furnished by Singhal. The CBI, however, after an attack by the BJP, clarified that the reference could be to anyone. 

In the same interview, Sinha also claimed that the UPA-II government would have been very happy had the CBI named Shah in the chargesheet. “There were political expectations... The UPA government would have been very happy if we had charged Amit Shah... But we went strictly by evidence and found there was no prosecutable evidence against Shah,” Sinha told the newspaper. It was a heavily loaded statement and perhaps the first instance when the CBI chief came out and spoke against the government. It seemed Sinha had realised that the government wouldn’t get a second term and hence began playing safe.

The case turned into a tug-of-war between Sinha and a special director Salim Ali, who was also supervising the case. “The chief tried to show that Ali was trying to prosecute Shah while he himself was trying to save him,” a source says. Insiders, though, add that there was little evidence against Shah to prosecute him. “Perception and evidence are two very different things. It is hard to get evidence in such cases,” an official who dealt with the case told Hardnews. The official says it was really tough dealing with the case, and there was tremendous pressure. Even the files pertaining to the case were sent to the officer a few days before he retired.

“Look at the plight of the SP in Nagpur who was also associated with the case. He has been under so much pressure and harassment that he did not want to stay on in the agency,” the official says. At least two CBI officials had to face the music after the new government took charge. While Ali was sacked as a member of the National Disaster Management Authority, another senior official was sent back to his parent cadre without an extension.

Which prompts Bhushan to ask, “How can you have an independent CBI when the administrative control rests with the government?” A former CBI top sleuth thinks what the agency needs is to take an institutional stance. “The CBI cannot be completely independent; one can only talk of operational independence. But unfortunately today, we have a situation where the bureaucracy works in cahoots with politicians and when exposed, tends to blame the politicians.”

Ever since the new government took charge, a new sense of urgency has marked the way the CBI goes about investigating cases. In the Aircel Maxis case, the company’s former owner Sivasankaran had complained that he was being coerced by former Union minister Dayanidhi Maran and his brother Kalanidhi Maran to sell off his stake to the Malaysian Maxis. For three years, the CBI refused to file charges, citing paucity of evidence. While the investigating team and the director of prosecution said there was enough evidence to press charges, the chief had a different opinion. After the NDA came to power, the Aircel-Maxis matter was referred to the newly appointed Attorney General Mukul Rohatgi, who gave his opinion that there was enough evidence to proceed with a chargesheet against the Marans. There is still no clarity whether there is enough evidence at all to proceed against the Malaysian company, which is armed with the opinions of former Chief Justices who suggest that they did no wrong in buying a company that was up for sale.


Late last year, a senior minister in the UPA government reportedly got a tipoff that the CBI chief could open an inquiry against his son allegedly involved in a corruption scandal. The minister, knowing that some senior officials were mixing with dubious middlemen, put the finance ministry sleuths to tap the phones of MoinQureshi, one such Delhi-based middleman. Five months later, the income tax department, which by then had amassed recordings running into several hundred hours, found that Qureshi may have been laundering money at the behest of top CBI officials. Said to be very close to former CBI chief AP Singh, the premises Qureshi used to function out of was registered in the name of Singh’s family. “When we visited his official residence, our host took us around, showing some exquisite carpets and antiques which, she said, a friend had gifted her,” another CBI official who visited Singh recalled. Interestingly, Qureshi, whose wife Nasreen Qureshi told a fashion magazine that their new mansion in Chhatarpur was inspired by Picasso’s work, is known for his fondness for antiques and expensive carpets.

In spite of his tough dealings, Singh’s tenure is marred by allegations that many corporate houses got away with their malpractices easily. Bhushan suggests that the 2G case itself may have been compromised. There is still much disbelief about how the CBI exonerated TATA and other major players while it lodged cases against and arrested lesser known entities, like Swan Telecom and Unitech. Singh was also instrumental in going out on a limb to say that no case was made out against Sunil Bharti Mittal of Bharti Airtel. In 2012, Singh suo-moto sent this note to the former attorney general just a week before his retirement: “In the FRs (finding reports) submitted by the IO and comments of officers, there is no evidence on record suggesting any misrepresentation of facts for additional spectrum by the said person or anyone else on behalf of the company. His (Mittal) associations/meetings with the then MoC& IT and then Secretary, POT, alone do not constitute any criminal intent or overt act on his part, as the meetings per se were not illegal as per evidence.”

It has been five months since the raids at many of Qureshi’s premises in Delhi and elsewhere. Despite that, there is great reluctance on the part of the Finance Ministry to fast-track the investigations. Insiders suggest that it has become a case of mutual blackmail. “The way government is selectively leaking out information does suggest that there is an attempt to blackmail the CBI chief,” an official in the Finance Ministry said. “The new government also wants to keep the CBI on a leash,” adds the official. His assertions may not be misplaced given how the BJP constantly attacked the CBI during the run-up to the elections. The new government has more reasons to keep it in check. This way the parrot firmly stays in the cage.

This story is from the print issue of Hardnews: AUGUST 2014