Fact and fantasy

Print edition : January 20, 2001

The arrest of Mumbai diamond magnate Bharat Shah and developments since then have shown the resolve of the Maharashtra government to end the nexus among crime, business and politics.

BHARAT SHAH made the terrible mistake of not taking the films he financed seriously. One of the established canons of Hindi mainstream cinema is that outlaws along with their political and financial sponsors must meet an unpleasant end. So it was in S atya, the stark underworld romance that propelled the millionaire diamond merchant to the centre stage of the Hindi film industry scene. When the Mumbai Police began investigating Shah's activities in December, the businessman showed few signs of con cern: evidently he believed that his powerful political patrons would bail him out. Hindi commercial cinema revels in the implausible and the fantastic, but if Shah has time for contemplation in police custody, the genre may appear alarmingly realistic.

On January 8, Shah drove to the Crime Branch headquarters at Crawford Market, for what he believed would be routine questioning. The financier had just returned from a business visit to London, confident that there would be no legal action against him. A lthough he had been twice questioned by the Crime Branch for having financed Nazim Rizvi's appropriately-named film Chori Chori, Chupke Chupke (Stealthily, Silently) on behalf of Karachi-based gangster Shakeel Ahmad Babu, alias Chhota Shakeel, Sha h had visited New Delhi en route to London, and lobbied his contacts. Sources say several top politicians of the Shiv Sena and the Bharatiya Janata Party, including a close relative of Prime Minister Atal Behari Vajpayee, had promised to intercede on his behalf with the Maharashtra government.

What Shah and his friends did not know was that the Mumbai Police had just been waiting. Inside the Crime Branch office, the businessman was confronted with tapes of his conversations with Shakeel and top mafioso Dawood Ibrahim Kaksar, made during a surv eillance operation that lasted over two months. A stunned Shah, officers present say, refused to listen to the first of the tapes. The evidence was damning. In one conversation, Shah and Shakeel discuss means to launder Rs.75 lakhs extorted from Mumbai b usinessman Shakeel Morani. In another, there is a reference to a hawala operator called Bhatija (nephew) pumping in $50,000 into Chori Chori, Chupke Chupke on Shakeel's behalf. Elsewhere, sources say, Dawood Ibrahim himself discusses financial inv estments in the Mumbai stock market with Shah.

Phone surveillance warrants had been obtained by the Mumbai Police under the provisions of the harsh Maharashtra Control of Organised Crime Act (MCOCA) when investigators began to look at Rizvi's connections. Monitoring the phones of the film producer, t hey heard repeated references to a 'B.S.' It did not take much to put two and two together, and Shah's mobile phones and land lines were also tapped. The evidence flowed in, to be buttressed by confessions made by Rizvi after his arrest on December 13. O nly a few loose ends now had to be tied up before Shah's arrest. He has now been charged under Section 3(3) and (4) of MCOCA, which deals with conspiring with criminal syndicates and possessing unaccountable wealth on behalf of their members. MCOCA offen ces are non-bailable, and confessional statements and wiretaps are admissible in evidence.

BHARAT SHAH'S not inconsiderable army of friends have been doing their best to defend him. The businessman himself has protested innocence. Produced in the Special Court of Judge A.P. Bangale, Shah said the charges were "all false". "I have given all inf ormation and documents regarding Chori Chori, Chupke Chupke," he continued. "Every day, the police are saying new things and making new statements. They are spoiling my image." Shakeel, for his part, has given a certificate of absolution to Shah. The businessman, he said in an interview to a national newspaper, was a "white aadmi" (clean man). The gangster has illustrious company in the Shiv Sena, which has close links with Shah. Although no politician has gone on record to condemn the arr est, pro-Sena journalists and newspapers have stated that the arrest was the outcome of personal malice.

At the root of this allegation is the fact that Shah financed Haseena Maan Jayegi, a film produced by Sena chief Bal Thackeray's daughter-in-law, Smita Thackeray. What the vendetta theorists have not noticed, however, is the fact that the Sena gov ernment had first initiated, and then stonewalled, a case against Shah for Customs violations. In December, Sena leader and former Chief Minister Narayan Rane complained of slow progress in the case during Assembly proceedings. Deputy Chief Minister Chha gan Bhujbal replied by pointing out that the slow progress was a result of actions taken under Rane, and suggested that events were not unconnected to the financial relationship between Shah and the Thackeray family. Airport Customs and the Enforcement D irectorate have now been asked by the Mumbai Police for information on the case, which involves an alleged evasion of duty amounting to some Rs. 13 crores.

More important, Shah's protestations of innocence seem to hold little water. In an interview, for example, Shah said that "99 per cent, I think that the finance for the film was from me". A day before his arrest, the financier filed an application in the MCOCA court, asking that the film's seized prints be returned to him. Shah produced account books, which showed he made cheque payments amounting to Rs. 12 crores to Rizvi. But if these transactions were indeed above-the-board ones, Shakeel's taped asse rtions of proprietorship of the film, made in hours of conversations with Rizvi, is inexplicable. Then, Shah has said that while he was not the producer of the film, all rights belonged to him. Yet, the Mumbai Police tapes quite clearly record Shakeel an d Rizvi disposing of its music rights to Kishan Kumar of T-Series. Finally, Shah has yet to explain why he handed over crores of rupees without collateral to Rizvi, who by his own account he barely knew.

These questions will doubtless be answered in court. Shah's lawyers have moved a bail application in the Mumbai High Court; they contend that the severe provisions of the MCOCA are inapplicable in this case. The Mumbai Police are playing its cards close to the chest, but senior officials claim that the evidence is considerably better than that in the Judge J.W. Singh case, another recent underworld crime bust based on a wire-tap operation. Lawyers told Frontline that the most difficult part of th is case would be for the Mumbai Police to prove that the person Shah and Rizvi are talking to is indeed Shakeel. Since Shakeel is outside the country, the fact cannot be established through technical means. One possibility is that associates of Shakeel m ay be called to give evidence. The other, more likely, is that Rizvi may offer to turn approver in return for a lighter sentence.

The reaction of the Mumbai business community to Shah's arrest illustrates a curious moral malaise in the city. On January 9, the Mumbai Diamond Merchants Association closed the city's main exchanges at Opera House, Malad and Dahisar to protest against t he arrest. The chairman of the Gem and Jewellery Promotion Council, Sanjay Kothari, said the protest was to "honour his (Shah's) contribution to the diamond industry for the past thirty years". "Bharat bhai has a clear name and his arrest is unfair," Kot hari added, "we are convinced he has nothing to do with the underworld." The one-day shutdown cost the industry an estimated Rs. 800 crores. A few traders attempted to argue that the arrest had nothing to do with the diamond trade, but their colleagues e vidently believe that wealth should guarantee legal impunity. Shah is one of India's largest diamond traders, with operations running into several thousand crores of rupees a year.

Reactions have not been much different in the film industry. Many of the industry's luminaries had defended Shah when he was first questioned by the Crime Branch, and the reasons are not hard to see. Shah is believed to have some Rs. 100 crores invested in films under production. A sum of Rs. 45 crores has been put into Sanjay Leela Bhansali's Devdas, which is expected to be the most expensive Bollywood production when it hits the screen, along with Rajkumar Santoshi's almost equally extravagant Lajja. Another Rs. 60 crores has been sunk into Ajay Devgan's Raju Chacha and K.C. Bokadia's Hum Aapke Hai Sanam. Shooting on Devdas and Lajja was terminated after news of Shah's arrest broke. Shah has part-financed sev eral other well-known films, ranging from mainstream enterprises, Mani Ratnam's Dil Se and Rajkumar Santoshi's China Gate to more offbeat films such as Kaizad Gustad's Bombay Boys.

For Shah, sources say, his film investments are a minor pastime which bring social cachet in film-crazy Mumbai. Other than the diamond trade, he is a major player on the Bombay Stock Exchange, which fell 63 points on the day of his arrest. Shah is believ ed to be frequently approached by brokers for short-term, high-interest loans in order to overcome difficult situations.

Television production is another area in which Shah has large financial stakes. Ever since his first questioning, shares of the music firm Tips have been in free fall, along with Zee Telefilms, one-time film icon Jeetendra Kapoor's television software pr oduction house Balaji Telefilms, and top producer Subhash Ghai's Mukta Arts. Stock broker Ketan Parekh has also been associated with heavy investments in these organisations, but denies any association with Shah's financial interests in the stock market. If the Mumbai Police are to be believed, Shah was a key player in laundering Shakeel's and Dawood Ibrahim's money.

FOR the moment, Shah is in hospital with that mysterious heart malaise which seems to strike all VIPs at the gates of jail. The Mumbai Police can take credit for having had the courage to take on one of Maharashtra's most important and affluent residents . How events will progress from here, however, will depend on whether the State's ruling Democratic Front (D.F.) will be able to resist the pressures exerted by the campaign to save Shah. The State government has shown a resolve to restore the rule of la w in Mumbai, and to end the nexus involving crime, business and politics that was thriving during Sena-BJP rule. It has not passed unnoticed that Shah's arrest was followed in quick time by the decision to prosecute Thackeray for his recent demand that a ll Muslim citizens in India be disenfranchised.

In the long term, the D.F. will have to go further. The criminalisation of Mumbai capital needs to be reversed. For that to happen, a full investigation of the links among underworld extortion, much of it the pickings from a corrupt land market, the film industry and supposedly legitimate business will have to be explored. Through the 1980s, the Shiv Sena's rise to power was fuelled by its ability to profit from these networks. Shah's past film ventures, and his investments in the stock markets and the diamond trade, will need to be the subject of a painstaking investigation. Bhujbal has already welcomed the prospect of an additional probe by the Central Bureau of Investigation into the affair in order to garner more valuable evidence. Ending criminali ty in Mumbai will not just cut at the roots of mafia organisations, but the fascist forces that strive to control the city.

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