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A vital breakthrough

Print edition : Dec 25, 2000 T+T-
Swiss hand over Hinduja bank papers.

THE handing over to India by the Swiss authorities of the second and final set of papers relating to the Bofors deal has ended a ten year paper chase. The letters rogatory for the papers were sent by a non-Congress(I) government of India in 1990, but as a consequence of obstructionist tactics adopted by the recipients of the Bofors payments, notably the Hinduja brothers, these could be obtained only now. A substantial set of papers delivered by the Swiss authorities in 1997 resulted in the Central Burea u of Investigation (CBI) charge-sheeting five individuals who were the alleged beneficiaries of payoffs by the Swedish firm AB Bofors in connection with the Rs.1,437.72-crore howitzer deal with India. The material in the first set of papers buttressed an d supplemented the journalistic and CBI investigations, and it is now expected that the second set will help the CBI identify the remaining beneficiaries as well.

A CBI team which went to Berne to collect the papers from the Indian Ambassador to Switzerland, to whom they were handed over by the Swiss authorities, is back in the national capital with the precious cargo. External Affairs Minister Jaswant Singh rejec ted an Opposition demand for the disclosure of their contents in Parliament on the ground that they were obtained by the government on the basis of a specific commitment to the Swiss authorities that the documents would be used only for the purpose of in vestigation and criminal prosecution in a court of law, and not for political purposes. It was chiefly owing to the efforts of the External Affairs Ministry through its mission in Berne that the papers were obtained without further delay.

For the CBI, the receipt of the second set of papers marks a morale-boosting triumph: it is a successful culmination of its efforts to take the probe to its logical conclusion. R.K. Raghavan, Director of the CBI, who has in a low-key way established a re putation for independence and objectivity, had travelled to Switzerland and met the authorities to expedite the process.

It is widely believed that the second set of papers will, investigatively, help nail the Hinduja involvement as recipients of the payoffs. The three Hinduja brothers, Srichand, Gopichand and Prakash, were among the seven appellants whose names have been released by the Swiss authorities. The rejection by the Swiss Department of Justice and Police (SDJP) of the Hindujas' appeal seeking to block the transfer of the Bofors papers followed three successive levels of Swiss courts rejecting similar appeals ma de by them on legal grounds. The second charge-sheet, when it comes, is expected to name the recipients of the 'entitlements' credited by AB Bofors into the three coded accounts named Lotus, Tulip and Mont Blanc, amounting to 3 per cent of the value of t he contract.

Informed CBI sources told Frontline that it would take the agency several weeks to complete the investigation. This would include careful study of the bank papers just received and interrogation of the individuals implicated by the documents (assu ming that they would allow themselves to be interrogated by the CBI). "Unless there is adequate and specific information available to us in these documents, we cannot issue a charge-sheet without further investigation," an informed source said. However, the same source pointed out that the earlier set of papers contained specific information which enabled the agency to issue a strong charge-sheet without questioning all the accused. "Let us go through the evidence available. It will take us a few months : banking transactions are rather complex to decode," said the official.

The CBI charge-sheet of October 22, 1999 named Win Chaddha, a Dubai-based businessman and former agent in India of AB Bofors; Ottavio Quattrocchi, the flamboyant Italian businessman whose proximity to the Rajiv Gandhi family is a matter of public knowled ge; Martin Ardbo, chief of AB Bofors which made the payoffs, and S.K. Bhatnagar, who was Defence Secretary when the deal was put through. Former Prime Minister Rajiv Gandhi's name also figured as an accused, in Column 2 of the charge-sheet - for obvious reasons.

The CBI Special Court of Judge Ajit Bharihoke found "sufficient prima facie material on record to proceed against the accused" and issued summons to three of the four individuals listed as accused. While Bhatnagar appeared in court on December 13, and counsel appearing for him sought bail, CBI counsel submitted that its summons to Win Chaddha had come back undelivered. However, according to the CBI, a telephonic message had been left at the Dubai residence of Chaddha asking him to appear in court . The court ordered issue of a non-bailable warrant for the arrest of Win Chaddha when he failed to turn up.

A technical error resulted in the summons to Bofors, now renamed Celsius, remaining unserved. This is being rectified. Ardbo apparently asked for the summons to be delivered in Swedish. The court directed the CBI to issue a translated version of the summ ons. The court also issued a fresh non-bailable warrant to Quattrocchi, against whom a warrant was issued earlier. CBI sources said that the time-frame for the warrant has been extended. The court will again hear the case on February 3, 2000.

A CBI team visited Malaysia in early December to pursue the case for the extradition of Quattrocchi. CBI sources told Frontline that the formalities relating to the extradition had been completed and that the agency was waiting for the response of the Malaysian authorities. "Membership of the Interpol involves certain obligations. Therefore we do believe that Malaysia, which is a member of the Interpol system, will fulfil its obligation," said the informed source. As for Win Chaddha's extradition , the source pointed out that the extradition treaty with Dubai is yet to be ratified by the two countries and that it would take some time before extradition proceedings are launched. However, Chaddha now has no legal status in any country. His Indian p assport was cancelled and another passport he had obtained from Belize in the Caribbean was cancelled at the urging of India. At present he is an illegal alien in Dubai, and therefore the CBI is likely to succeed in having him sent back even without laun ching extradition proceedings, the source said.

Informed CBI sources told Frontline that the agency was examining the legal aspects of charge-sheeting former External Affairs Minister Madhavsinh Solanki. They said that the agency had not received any response from the government for its request to prosecute Gopi Arora, a former bureaucrat who was associated with the deal.

Another set of documents received from Luxembourg recently is expected to throw light on the payoff trail relating to Win Chaddha. Letters rogatory have been sent to the Bahamas, Panama, Austria and Switzerland, countries to which money has travelled fro m the AE services account of which Quattrocchi was a beneficiary. The CBI is awaiting papers from these countries as well in order to identify the final beneficiaries of the payoffs.

The Bofors-India payoffs affair has gone through several stages of action - the decision-making stage, the arrangements for the payoffs stage, the cover-up and crisis management stage, the stage of journalistic investigation and expose and finally now, t he last and final stage - that of criminal investigation by the CBI, assisted by the Swiss Federal Police and the Swiss courts, and of prosecution in the Special Court. The Hindujas' hand in the second stage, namely in making arrangements for the payoffs to be made, were exposed by The Hindu's document-backed investigation as early as April 1988. The Hindujas first challenged the authenticity of the documents and subsequently denied that they had anything to do with the Bofors-India howitzer cont ract. The Hinduja hand in the cover-up and crisis management was exposed by excerpts from the Ardbo diary obtained by The Hindu. The Swiss authorities subsequently identified three of the four Hinduja brothers as being among the appellants in the legal process. Whether the influential expatriate brothers also had any role in the decision-making stage will be revealed only when the CBI interrogates them.

The Hindujas have extensive business and financial interests in India. They have sizeable investments in the communications, power, banking, the automobile sectors and they are naturally deeply perturbed over the latest breakthrough for the investigation into the Bofors scandal. The investigation, and possible prosecution, could gravely affect their personal and business interests.

Unfortunately for them, the Congress(I), which they long cultivated, will be able to do little for them in this round. The interest of the Congress(I) in l'affaire Bofors right now appears to be limited to getting Rajiv Gandhi's name deleted from Column 2 of the charge-sheet; in the process, the Hindujas have even been targeted by Congress(I) representatives, who have accused the Vajpayee government of being soft towards them. While the Hindujas do seem to have some support within the Vajpayee Go vernment, and particularly the Prime Minister's Office (PMO), unfortunately for them once again, the Home Ministry and External Affairs Ministry have acted in a way that gives them no quarter. Home Minister L.K. Advani and External Affairs Minister Jaswa nt Singh are not among the Hinduja brothers' favourite Ministers. While the External Affairs Ministry has acted effectively, at the diplomatic level, to remove the final obstacle to the handing over of the vital documents, the Home Ministry has taken the view that the CBI should be left well and alone to do its job. This stand is absolutely in line with what the Supreme Court contemplated when it conferred autonomy on the agency while dealing with the Jain hawala case.