“BE you ever so high, the law is above you,” a Supreme Court Bench comprising Justices S.N. Variava and H.K. Sema pronounced on November 18, 2003, criticising the exemption from personal appearance granted to Jayalalithaa by a Special Court in Chennai in “the disproportionate wealth” case and “London Hotels” case in which she was an accused.
These words proved to be prescient on September 27, 2014, when Special Judge John Michael D’Cunha of Bangalore found the Tamil Nadu Chief Minister guilty of corruption in the “disproportionate wealth” case. The prosecution case against her was that she had amassed wealth worth Rs.66 crore, including immovable property, business enterprises and cash, in her name and in the names of three other accused, Sasikala Natarajan, V.N. Sudhakaran and J. Ilavarasi, when she was Chief Minister from 1991 to 1996. She, of her own accord, drew a salary of only Re.1 for 27 months as Chief Minister and did not draw any salary for the remaining 33 months of her office, the prosecution said.
Judge D’Cunha, who ruled that the prosecution had proved its case, convicted and sentenced Jayalalithaa to four years’ simple imprisonment under Section 13(1)(e) read with Section 13(2) of the Prevention of Corruption Act (PCA), 1988, and imposed a fine of Rs.100 crore on her. Her assets, already attached by the court, will be adjusted against this fine amount.
Section 13(1)(e) of the PCA says that a public servant is said to have committed criminal misconduct if he or any person on his behalf has money or property more than his known sources of income during the period he was a public servant and is not able to account for it satisfactorily. Section 13(2) of the PCA prescribes a minimum of one year imprisonment and a maximum of seven years and also a fine for any public servant who commits criminal misconduct.
The judge also convicted and sentenced all the co-accused to four years’ imprisonment each. The judge found them guilty under Sections 120-B (criminal conspiracy) and 109 (abetment) of the Indian Penal Code (IPC) read with Section 13(1)(e) and Section 13(2) of the PCA. He directed them to a pay a fine of Rs.10 crore each. Their bank accounts and fixed deposits are to be appropriated towards the fine amount. The 18-year-long legal battle, which saw many attempts by the accused to obstruct and delay the judicial process, thus came to an end with Judge D’Cunha’s verdict.
As a consequence of her conviction, Jayalalithaa stood disqualified as a member of the Tamil Nadu Assembly and ceased to be the Chief Minister from the day of conviction. Under law, she is barred from contesting elections for the next 10 years. That is, her disqualification will last for six years from the date of her completing her four years of imprisonment. Jayalalithaa, who heads the All India Anna Dravida Munnetra Kazhagam (AIADMK) as its general secretary, was elected to the Assembly from the Srirangam constituency in the elections held in April 2011. She was sworn in as Chief Minister on May 16, 2011.
Under Section 8 of the Representation of the People Act, 1951, anyone who is convicted and sentenced to imprisonment even for a day under the PCA stands disqualified for six years from the date of his/her conviction and the period of sentence of imprisonment (see story on page 16).
Subramanian Swamy, now with the Bharatiya Janata Party (BJP), was the original complainant in the case.
K. Anbazhagan, general secretary of the Dravida Munnetra Kazhagam (DMK), AIADMK’s main political rival, later impleaded himself in the case as an intervener.
Soon after Judge D’Cunha pronounced his orders in a court hall inside the prison complex at Parappana Agrahara, about 20 km from Bangalore, Jayalalithaa, Sasikala, Sudhakaran and Ilavarasi were taken into custody and sent to prison after the mandatory medical tests.
Violence broke out across Tamil Nadu on September 27 as news of Jayalalithaa’s conviction and imprisonment spread. AIADMK protesters set fire to some buses, stoned the windscreens of a few others, and forced shopkeepers to close their shops. Government buses stopped running and autorickshaws kept off the roads, which wore a deserted look.
The monolithic party that the AIADMK is, with Jayalalithaa enjoying untrammelled power, her disqualification has led to uncertainty in the party. She had not groomed a second-rung leadership to take over from her in case the situation came to this pass. On instructions from Jayalalithaa in prison, AIADMK legislators elected Finance Minister O. Panneerselvam the Legislature Party leader. Panneerselvam will succeed her as Chief Minister, as he did in 2001.
Judge D’Cunha ruled that the prosecution had proved its case beyond reasonable doubt that Jayalalithaa had assets worth Rs.53.60 crore that was disproportionate to her known sources of income. M.S. Maradi, advocate assisting G. Bhavani Singh, the Special Public Prosecutor in the case, told reporters that the court had reduced the quantum of disproportionate assets to Rs.53.60 crore from Rs.66.65 crore as mentioned in the charge sheet after taking into account the evidence produced by the accused. Jayalalithaa had an income of about Rs.9.94 crore and an expenditure of about Rs.8.49 crore during the relevant period from July 1, 1991, to April 30, 1996.
The court ruled that Jayalalithaa could not satisfactorily account for the pecuniary resources acquired and possessed in her name and that of the co-accused and convicted her under Section 248(2) of the Code of Criminal Procedure (CrPC).
Top criminal lawyers explained that any person who had connived or abetted or conspired with Jayalalithaa to commit the alleged offence would also be constructively liable, whether they were public servants or not. If Jayalalithaa had acquired properties in the name of Sasikala, Sudhakaran and Ilavarasi (who were living with her) and if it was established that these properties had been bought with the money that Jayalalithaa could not satisfactorily account for, they were constructively liable. If the prosecution was able to convince the court that it had material to back up the allegation, she would be required to prove to the court that she had acquired them through her known sources of income ( Frontline , June 27, 1997).
When arguments took place in Judge D’Cunha’s court on the quantum of sentence to be awarded, Jayalalithaa said the case was foisted on her by her political opponents and called it a “witch-hunt”. She said she had suffered for 18 years because of this case and that she was afflicted with diabetes and hypertension. So she wanted a lenient sentence to be awarded to her.
Genesis of the case
The case has its origins in a list of 28 corruption charges that top DMK leaders, including its president M. Karunanidhi and Anbazhagan, presented in a 539-page document against Chief Minister Jayalalithaa and others on April 15, 1995, to the then Governor, M. Channa Reddy. (The DMK was the main opposition then.) The 25th charge of corruption related to Jayalalithaa, Sasikala and Sasikala’s brothers acquiring assets disproportionate to their known sources of income.
Before this, Channa Reddy had accorded sanction to Subramanian Swamy, then a Janata Party leader, to prosecute Jayalalithaa on charges of corruption against her. Swamy, on June 14, 1996, presented a private complaint before the Principal Sessions Judge, City Civil Court, Chennai, to prosecute her under the PCA.
Meanwhile, the DMK returned to power in the Assembly elections held in May 1996, defeating the AIADMK, and Karunanidhi became the Chief Minister.
Subramanian Swamy alleged in his private complaint that Jayalalithaa was guilty of criminal misconduct under Section 13(1)(e) of the PCA. The reply given in the Rajya Sabha to a question from him was that her wealth was zero during 1989-90; Rs.1.89 crore during 1990-91; Rs.2.60 crore during 1991-92; and Rs.5.82 crore during 1992-93. His investigation showed that her wealth stood at Rs.21.33 crore in 1993-94 and Rs.38.21 crore in 1994-95, Swamy said. He said it was beyond anyone’s imagination as how there could be such a big jump in someone’s wealth when she was drawing a salary of only Re.1 a month. He alleged that Jayalalithaa, in league with Sasikala and her close relatives, had been accumulating property after property, totally incompatible with their known sources of income ( The Hindu , June 15, 1996).
The Principal Sessions Judge asked the police to investigate Swamy’s complaint. N. Nallamma Naidu, Superintendent of Police, Directorate of Vigilance and Anti-Corruption (DVAC), was appointed the investigating officer. He filed the first information report (FIR) in the case on September 18, 1996. DVAC officials searched Jayalalithaa’s residences in Chennai and Hyderabad from December 7 to 12, 1996. The searches revealed caches of gold and diamond jewellery, saris, documents and cash which were handed over to the court.
Nallamma Naidu conducted a thorough and scientific investigation. He meticulously collected the chalans and receipts from banks into which the accused and others had transferred money from various sources, including the business enterprises or shell companies in which they were partners.
Informed sources said the DMK government had instructed the prosecutors to ensure that the investigating agency never overestimated the value of properties bought by Jayalalithaa and the other accused so that no mala fides could be attributed to the prosecution. This made the case strong.
In the initial stages of the trial, the prosecution was led by N. Natarajan, Senior Special Public Prosecutor, R. Shunmugasundaram, Public Prosecutor, and N.R. Elango, who is now a Senior Advocate. After Anbazhagan became the intervener in the case, Senior Advocates T.R. Andhyarunjina, Shunmugasundaram and Elango appeared for Anbazhagan in the Supreme Court. Advocates A. Saravanan, M. Natesan, R. Balaji Singh, R. Thamaraiselvan, T.M. Selvaganapathy and P. Kumaresan appeared for Anbazhagan in the Special Court in Bangalore. B. Kumar was the counsel for Jayalalithaa.
The stage was set for the trial to begin in the case when the DVAC presented the charge sheet before Special Court-III Judge P. Anbazhagan on June 4, 1997, in Chennai. It named Jayalalithaa as the first accused. The other accused were N. Sasikala (A-2), V.N. Sudhakaran (A-3) and J. Ilavarasi (A-4). Sudhakaran is the son of Sasikala’s elder sister V. Vanithamani and T.T. Vivekanandan. Ilavarasi was the wife of the late V. Jayaraman, Sasikala’s elder brother.
Among the assets the accused acquired, the charge sheet said, were palatial farmhouses and bungalows in and around Chennai, Neelangarai, Sirudavur and Paiyanoor; agricultural land at Utthukottai and Tirunelveli; Kodanadu Tea Estate in the Nilgiris; industrial sheds in Chennai; cash in bank accounts; investments in financial firms; diamond and gold jewellery; a cache of wrist watches; farmhouses in Hyderabad; and hundreds of saris and footwear. These were in Jayalalithaa’s name or in the names of the other accused or firms in which Jayalalithaa was a partner.
According to the charge sheet, the accused also floated several firms such as Messrs J. Farm House, J.S. Housing Development, Jay Real Estate, Jaya Contractors and Builders, Marble Marvels, Oceanic Constructions, Vinod Video Vision, Super Duper T.V., Sea Enclave, Indo-Doha Chemicals and Pharmaceuticals, Riverway Agro Products Private Limited, and Metal King. As she acquired these properties when she was the Chief Minister, that is, a public servant, the DVAC charged Jayalalithaa with offences under Sections 13(1)(e) read with 13(2) of the PCA.
The other three accused had not disclosed any avocation or lawful sources of income. They were living in the residence of Jayalalithaa at 36 Poes Garden, Chennai. They abetted Jayalalithaa in the commission of the crime by allowing her to acquire a substantial portion of these properties and financial resources in their names and by their holding such properties and pecuniary resources on behalf of her, the DVAC said.
On June 5, 1997, Special Court-II Judge S. Sambandam took cognisance of the charge sheet.
Later, Anbazhagan impleaded himself in the case and became the intervener. He filed written arguments under Section 314 of the CrPC.
In his submission, Anbazhagan said Jayalalithaa was Chief Minister from June 24, 1991, to May 13, 1996. Earlier, she was a Rajya Sabha member from April 1984 to January 27, 1989, and a Member of the State Assembly from January 27, 1989, to January 30, 1991. Sasikala, Sudhakaran and Ilavarasi were private individuals.
When Jayalalithaa’s mother, N.R. Sandhya (who had also acted in films), died in 1971, Jayalalithaa came to own five properties, including her residence in Poes Garden, a house in Hyderabad and lands with a vineyard, a farmhouse and servants’ quarters near Hyderabad, in Ranga Reddy district, Andhra Pradesh. The assets, which were in Jayalalithaa’ s possession up to 1987, were worth only about Rs.7.5 lakh. In addition, she had bank accounts for Rs.1 lakh and some jewellery in 1987, the intervener said. When Jayalalithaa was a Rajya Sabha member, she bought four cars and one jeep. Although Jayalalithaa had floated three business firms, Jaya Publications, Namadhu MGR and Sasi Enterprises in 1989-90 with Sasikala and others as partners, they did not generate any income.
As on July 1, 1991, she was found to have been in possession of properties and financial resources worth Rs.2,01,83,957 in her name and in the name of Sasikala, who was living with her at Poes Garden. They included properties acquired in the name of Jaya Publications, Sasi Enterprises and Namadhu MGR.
After July 1, 1991 (she was Chief Minister by then), her acquisition of assets gathered momentum, and Sudhakaran and Ilavarasi also came to live with her at the Poes Garden residence, which also served as the official residence of the Chief Minister, Anbazhagan said. During this period, Jayalalithaa and Sasikala together were found to have floated 32 firms in the name of Sasikala, Sudhakaran and Ilavarasi, he alleged.
“In respect of many of these firms, during the above period, there was no business activity at all, and in respect of the others, the activity was more in the nature of acquiring assets like lands, machinery, buildings, etc., and were not production-oriented,” Anbazhagan said. Subsequent to July 1, 1991, assets in the form of movable and immovable properties and pecuniary resources such as bank accounts were found acquired not only in the name of Jayalalithaa but in the names of Sasikala, Sudhakaran and Ilavarasi, the intervener alleged. There were frequent transfers of money from one account to another to facilitate the acquisition of assets. Anbazhagan argued that the huge quantum of such assets, when viewed along with the fact that Jayalalithaa was Chief Minister and Sasikala, Sudhakaran and Ilavarasi were living under the same roof with Jayalalithaa and did not have sufficient means to acquire assets in their names, established that the assets were actually acquired by Jayalalithaa.
Thus, when Jayalalithaa was a public servant, she acquired financial resources and properties which were disproportionate to her known sources of income, which would constitute the offence of criminal misconduct as described under Section 13(1)(e) of the PCA and Sasikala, Sudhakaran and Ilavarasi enabled Jayalalithaa to commit the offence, the DMK treasurer alleged.
As on April 30, 1996, Jayalalithaa, a public servant, was found to have acquired financial resources and properties in her name and in the names of Sasikala, Sudhakaran and Ilavarasi and the firms floated by them, which was disproportionate to her known sources of income to the extent of Rs.65,86,07,850, which she had failed to account for satisfactorily, Anbazhagan alleged.
The turning point in the case came when the Supreme Court transferred it from a Special Court in Chennai to a Special Court in Bangalore on November 18, 2003. In their 32-page judgment, Justices Variava and Sema said: “The petitioner [Anbazhagan] has made out a case that the public confidence in the fairness of the trial [at Chennai] is being seriously undermined…. There is a strong indication that the process of justice is being subverted” ( Frontline , December 19, 2003).
In his petition, Anbazhagan said that after the AIADMK returned to power in May 2001, a new prosecutor was appointed in the case and most of the prosecution witnesses were recalled for cross-examinations and they turned hostile. The public prosecutor did not object to the witnesses being recalled. Anbazhagan alleged that the public prosecutor did not make any effort to declare them hostile. The police officers, who were under the control of the State government, could not be expected to prosecute the cases diligently against Jayalalithaa, who was the Chief Minister, Anbazhagan said.
Justices Variava and Sema rejected the argument of Jayalalithaa’s counsel that Anbazhagan had no locus standi to file the petitions and they called it “an argument of despair”. They said that political opponents “are the watchdogs of the government in power” in a democracy. The judges said, “In the present case, the circumstances… are such as to create reasonable apprehension in the minds of the public at large in general and the petitioner in particular that there is every likelihood of failure of justice.” And the judges ordered the transfer of the trial to a special court to be set up in Bangalore.
Jayalalithaa recorded her statements (replies) on October 20 and 21 and November 22 and 23, 2011, to 1,339 questions prepared by the court based on the evidence gathered from 259 witnesses in the case. She said she was ignorant of the assets acquired by various companies named in the case against her because she was only a silent partner in them and did not take part in their daily activities. Jayalalithaa, who remained calm and argued assertively, contended that the jewellery seized from her Poes Garden residence was overvalued and that she had acquired the diamond jewellery even before she became the Chief Minister. She wanted the court to make a fresh valuation of her jewellery. She alleged that the police had planted silverware in her house. She did not own all the saris found in her home and that the DVAC had planted some of them. She accepted that she drew a salary of only Re.1 a month.
She denied having spent Rs.5.59 crore on the wedding of her then foster son, Sudhakaran. “She said that not a penny had been spent by her for the marriage. All expenses were borne by the bride’s family,” B.V. Acharya, Special Prosecutor in the case, quoted her as having said on November 22, 2011. She acknowledged the facts about her bank statements. The entire case was fabricated at the instance of the DMK, Acharya quoted her as having said. Two DMK Ministers had interfered in the investigation, she alleged.
Jayalalithaa, who filed a detailed statement along with voluminous documents, argued that a warrant had been issued only to search 36 Poes Garden, and not the neighbouring 31A. The search, therefore, at 31A was illegal. She claimed that she did not buy any property other than 31, Poes Garden, when she was Chief Minister from 1991 to 1996. The three other accused also recorded their statements in the court.
When Judge D’Cunha gave his ruling on September 27, it turned out to be a climactic verdict for the 18-year-long legal battle and the AIADMK.
The tenacity with which the DMK pursued the case has been remarkable. Karunanidhi even wrote an eight-page series in the DMK organ, Murasoli, tracing the history of the case, including its vicissitudes.