Shackles on CBI

The investigating agency is in the dock for compromising its independence from the political executive while investigating the coal scam.

CBI Director Ranjit Sinha. His affidavit in the Supreme Court, filed on May 6, exposed the nexus between the CBI and the government and confirmed that the CBI had misled the Supreme Court on March 12.

THERE was a sense of deja vu in the proceedings before Court No.4 of the Supreme Court of India on the afternoon of May 8. The presiding judge, Justice R.M. Lodha, was leading the offensive against the Central Bureau of Investigation (CBI), India’s premier investigating agency, while his colleagues on the Bench, Justices Madan B. Lokur and Kurian Joseph, were seen quietly endorsing their brother judge’s views on the virtues of and independent investigation by the agency into the multi-crore coal scam. The CBI, facing allegations that its independence from the political executive was compromised while investigating the scam, had a hard time defending its role.

Long-time court watchers were quick to notice the similarity in the court proceedings of May 8 with those in August 1996, when the court was monitoring the CBI’s investigation into the hawala scam. In that instance, too, the then CBI Director, Joginder Singh, received strictures from the Supreme Court for hobnobbing with some politicians. Taking strong exception to his meeting persons against whom investigation was pending, the court asked him to explain his conduct. The court reminded him of its earlier order that officers investigating the case should not seek instructions from anyone except the court.

Joginder Singh apologised to the court and resolved not to meet anyone except the Minister-in-charge. The court’s monitoring of the probe resulted in the landmark judgment in Vineet Narain vs Union of India , delivered by the late Justice J.S. Verma, on December 18, 1997. The judgment carried several directions that were aimed at insulating the CBI from political interference in its investigations.

The May 8 proceedings before the Supreme Court, therefore, made one wonder whether anything had really changed despite Vineet Narain . Justice Lodha’s observations showed that judicial activism to free the CBI from political executive, which Justice Verma crafted in the form of continuous monitoring of a corruption case, had turned full circle. Justice Lodha’s repeated references to the Vineet Narain judgment while castigating the CBI only underlined the court’s exasperation.

Status report In Manohar Lal Sharma vs The Principal Secretary and others , which the court heard on May 8, the allegation was that the Central government had gone in for massive allocation of the scarce natural resource of coal to a few select private companies at no cost in a completely arbitrary and non-transparent manner, causing huge loss to the public exchequer, running into lakhs of crores of rupees. According to another petition filed by the non-governmental organisation Common Cause and six eminent persons, while the sword of the introduction of competitive bidding was kept hanging, captive coal blocks were allotted to companies/cronies at breakneck speed, many of whom were not even eligible or had no real need of coal, and most of whom had links with politicians including Ministers. This petition sought a cancellation of the entire allocation of captive coal blocks to private companies from 1993 and a thorough investigation into it by a special investigation team.

The CBI’s preliminary inquiry report, submitted to the court, stated that proper procedure had not been followed for evaluating the bidders and selecting the allottees. The CBI filed its first status report in the Supreme Court on January 8. The Additional Solicitor General, Harin Raval, appearing for the CBI, then categorically told the court that the report had not been shared with the government. The Attorney General, G.E. Vahanvati, also claimed in the court that he had not seen the report as the same was not being shared with the government.

On March 12, the court asked the CBI to file a further status report by April 26 and directed it not to share the details of the investigation with the political executive. Immediately after this hearing, the government transferred Deputy Inspector General Ravi Kant, who was supervising the investigations into the case, to the Intelligence Bureau. This raised suspicions. On May 8, the court brushed aside the government’s stand that Ravi Kant was transferred on his own volition and directed his re-induction into the CBI and the ongoing investigation into the coal scam.

Under directions from the Central Vigilance Commission (CVC), the CBI has registered 11 first information reports for offences of corruption, cheating, and criminal conspiracy against several companies and “unknown public officials”. According to an application filed by Common Cause, persons who are the subject matter of the investigation are extremely influential and powerful; the Prime Minister’s Office, the Ministry of Coal, the Ministry of Steel, the Ministry of Power, State governments and big corporate companies were either involved in the allocation of coal blocks or are beneficiaries of the allocation. Meanwhile, the Comptroller and Auditor General (CAG)’s report of August 2012 castigated the Centre for not auctioning the coal blocks.

CBI Director Ranjit Sinha’s affidavit in the Supreme Court, filed on May 6, further exposed the nexus between the CBI and the government and confirmed that the CBI had misled the Supreme Court on March 12. The CBI admitted that its status report had been seen by the government before it was filed in the court and that it was vetted and its observations were diluted at the instance of the government.

Changes and deletions Sinha revealed that a meeting was held in the chamber of the Minister for Law and Justice Ashwani Kumar during the first week of February. The status reports had not been prepared at that time. The CBI team dealing with the matter showed all the draft reports to Raval.

On March 6, Raval told the CBI that Ashwani Kumar had wanted to peruse the draft status reports and a meeting had been arranged at Ashwani Kumar’s office. The Minister perused a copy of the draft pertaining to coal block allocations made during 2006 and 2009 and made certain changes. In this meeting, Raval, Vahanvati and Sinha were present.

On the same day, another meeting took place at Vahanvati’s residence in the afternoon, in which Raval, CBI Joint Director O.P. Galhotra and Ravi Kant were present. Vahanvati went through the status reports pertaining to the allocations made during 1993 to 2005 and suggested some changes.

A third meeting took place on the evening of March 6, in which Shatrughna Singh, Joint Secretary in the Prime Minister’s Office, and A.K. Bhalla, Joint Secretary in the Coal Ministry, met Galhotra. These two Joint Secretaries suggested amendments to the draft status reports. Sinha then approved the final draft on March 7, before filing it in a sealed cover in the Supreme Court.

Sinha defended the interactions with the political executive, saying that the central theme of the status reports had not changed after these meetings and that there was no deletion of any evidence against any suspect or accused, nor letting off of anyone. “Since it was our belief that there was no specific direction on the issue by this court, it did not occur to us that the fact ought to be brought to the notice of this court,” he said.

According to Sinha, the tentative finding about the non-existence of a system for the allocation of specific weightage/points was deleted at the instance of the officials of the PMO and the Ministry of Coal. The other tentative finding about non-preparation of broadsheets or charts by the screening committee was deleted by Ashwani Kumar.

Sinha reasoned: “Since both these changes pertained to tentative findings of the CBI, which would be arrived at with further clarity on more enquiries, the same were acceptable.”

Ashwani Kumar had also suggested the deletion of a sentence about the scope of the inquiry with respect to the legality of allocation while amendments in law were in process. Sinha also claimed that there is nothing in the CBI (Crime) Manual to guide whether status reports in respect of an ongoing investigation in a sub judice matter are to be shared with others or not. Sinha then referred to the directions of the Supreme Court in the Vineet Narain case in an interim order on March 1, 1996. When the court asked him on May 8 why the manual was not amended all these years to comply with those directions, he had no answer.

‘Caged parrot’ Sinha’s revelations only invited further strong remarks from Justice Lodha on May 8. Justice Lodha inferred that the CBI had allowed the heart of the status report to be changed by the political executive. “The CBI is like a caged parrot speaking his master’s voice. It is a sordid saga that there are many masters and one parrot,” was another observation of Justice Lodha that captured the mood of the day at the court. He repeatedly quizzed the CBI on why it had interacted with the government officials when its role was to investigate. He regretted that because of this meddling no substantial progress could be achieved after the registration of the case in the coal scam probe.

On March 12, the petitioners had requested the court to appoint a couple of retired judges or investigators to lead the proposed SIT. On May 8, their counsel, Prashant Bhushan, reiterated it during his submissions before the court. “They may then pick their own team of CBI investigators and have full access to all CBI resources. This will add to the credibility of the investigation, as it will go a long way in insulating it from political and corporate influences,” the petitioners said.

They reasoned that by merely going through the periodic status reports, it would be difficult for the Supreme Court to come to a conclusion that the investigation was on the right track. Having a retired judge and/or an experienced investigator would mean that they would have the time to go through each and every case file on a day-to-day basis, and would therefore be of huge assistance to the investigation team and also the Supreme Court in monitoring the same, they said.

In Sahara vs Sebi (CA9813/2011), the Supreme Court, keeping in view the nature of the case and the huge amount of money involved (Rs.24,000 crore), vide order dated August 31, 2012, had appointed Justice (Retd) B.N. Agarwal, former judge of the Supreme Court, to supervise the actions of the Securities and Exchange Board of India (SEBI) in enforcing the directions of the Supreme Court against the Sahara group. The appointment of Justice Agarwal proved to be of huge assistance to SEBI to take corrective action without fear or favour and was also of assistance to the Supreme Court in ensuring the implementation of its directions, the petition said.

On May 8, the court appeared not in a mood to rush to fill the void in the law to make the CBI further insulated from the political executive, or to direct the investigations to be done by an SIT, as suggested by Bhushan. Instead, it asked Vahanvati to consult the government and let it know, before July 10, the next date of hearing of the matter in the Supreme Court and whether a law could be enacted to insulate the CBI from extraneous influence so as to ensure its functional autonomy. Hinting that the government could try the ordinance route to enact the law during the interregnum between two Parliament sessions, the court observed: “It would be a golden day if that happens.”

In the Vineet Narain case, the court had made it clear that though the CBI was under the administrative control of the government, no Minister could interfere in its investigation. The next hearing of the coal scam case will show how the government and the judiciary will further strengthen this direction, which has remained diluted all these years.