Politics

Ripples of discontent

Print edition : November 10, 2017

Congress workers protest against the "loot" by Jay Shah, in Hyderabad on October 10. Photo: K.V.S. GIRI

Revelations about the tremendous growth of Amit Shah’s son’s business in a very short time shock even members of the Sangh Parivar, who are surprised by the defence put up by BJP leaders.

NOTWITHSTANDING the public posturing of dauntlessness, there is general agreement within the echelons of the Bharatiya Janata Party and the Sangh Parivar led by the Rashtriya Swayamsewak Sangh (RSS) that the revelations brought out originally by the news and analysis portal The Wire on the amazing growth of the business ventures of Jay Shah, BJP president Amit Shah’s son, have aggravated the political troubles facing the Narendra Modi-led National Democratic Alliance government. A number of senior and middle-level leaders of the BJP and other Sangh Parivar outfits who talked to Frontline on the issue were of the view that “The Wire Jay Shah revelations”, as they have come to be termed by a section of political observers, had dented the image of the government and the party.

“To start with, it has landed a very heavy blow on the public image of the BJP and the Modi government as a steadfast upholder of probity in governance and public life. The strangeness of the growth of Jay Shah’s business empire in a matter of approximately one financial year has indeed raised eyebrows even among the rank and file of Sangh Parivar organisations. This being the case, the sense of disillusionment is even higher among the broad support base of the party and the government, which is not yet completely in tune with the organisational systems of the Sangh Parivar. Along with this qualitative element, the timing of the revelations is also pretty bad since it has marked the persistence of the trying times of the last two months,” a senior RSS functionary based in Meerut in western Uttar Pradesh told Frontline.

Many of these senior and middle-level functionaries of the Sangh Parivar outfits were in agreement that when the history of the Narendra Modi regime was documented objectively, the months of September and October 2017 would be designated as among the most trying. “Who knows,” added the Meerut-based leader, “it could well get termed as the very tipping point of larger reverses.” He recounted how the RSS had convened a meeting of 40-odd Hindutva outfits in its fold in early September to warn about a growing restiveness among the people against the three-and-a-half-year-old Modi government. This warning was soon followed by voluble criticism of government policies by two senior BJP leaders—former Union Finance Minister Yashwant Sinha and former Union Commerce Minister Subramanian Swamy—that the economic policy direction of the government was headed for an “unmitigated disaster”. That the Jay Shah revelations have followed all this is indeed ominous.

The Wire’s story

The Wire’s story says that Temple Enterprise, a company owned by Jay Shah, recorded a turnover increase of 16,000 times in the year following the election of Modi as Prime Minister and the elevation of his father as party president. This astonishing growth, according to the website, was recorded in the very filings with the Registrar of Companies (RoC). In concrete terms, this meant an increase in revenue generation from a mere Rs.50,000 in 2014-15 to over Rs.80 crore in 2015-16. The RoC records, as reported by The Wire, also revealed “that in the financial years ending March 2013 and 2014, Shah’s Temple Enterprise Private Ltd engaged in negligible activity and recorded losses of Rs.6,230 and Rs.1,724 respectively”. However, “in 2014-15, it showed a profit of Rs.18,728 on revenues of only Rs.50,000 before jumping to a turnover of Rs.80.5 crore in 2015-16”.

The report also said that the “astonishing surge in Temple Enterprise’s revenues came at a time when the firm received an unsecured loan of Rs.15.78 crore from a financial services firm owned by Rajesh Khandwala, the samdhi (in-law) of Parimal Nathwani, a Rajya Sabha MP and top executive of Reliance Industries”. It went on to add that “one year later, in October 2016, however, Jay Shah’s company suddenly stopped its business activities altogether, declaring, in its director’s report, that Temple’s net worth had ‘fully eroded’ because of the loss it posted that year of Rs.1.4 crore and its losses over earlier years”.

Interestingly, the company closed its operation barely a month before the announcement and implementation of demonetisation by Modi in November 2016. According to a senior RSS functionary, this aspect is a major sore point among the Sangh Parivar rank and file. “Essentially, a large section of the Sangh Parivar rank and file is of the view that this sudden closure of operations points to something akin to insider trading and access to privileged information leading to unfair advantage. Many of them also feel that this has placed Jay Shah on a par with Robert Vadra, son-in-law of Congress president Sonia Gandhi, who too had allegedly benefited in big monetary terms during the Congress-led United Progressive Alliance government on account of access to privileged information. In any case, these activists complain that the revelations have made them overwhelmingly defenceless before their political adversaries on the ground.”

They also see as problematic the manner in which the BJP leadership, especially party president Amit Shah, sought to build up a defence for Jay Shah. By now it is evident that Amit Shah had altered the plan for his participation in the Kerala BJP’s Jan Raksha Yatra to work out the defence of his son. Amit Shah had originally announced that he would participate in the Kerala programme for three days starting October 3 but rushed back to Delhi after staying in Kerala only for a day. The story that the BJP leadership circulated initially was that Modi had summoned him urgently to discuss GST-related issues and initiatives. However, it was soon revealed that the real reason was his urgency to try and build up defence for his son.

Central to this manoeuvre was the listing of Additional Solicitor General Tushar Mehta to defend Jay Shah in court. Later revelations showed how Mehta was granted permission to defend Jay Shah on October 6 itself, even as The Wire had raised some questions as part of eliciting response before the publication of the story. The Wire published the revelations on October 8, four days after Amit Shah cut short his Kerala trip and two days after Mehta had obtained permission from the Law Ministry. This was followed by Mehta’s announcement that he was being consulted by Jay Shah and that he had obtained necessary permissions to appear before the court on behalf of Jay Shah. Yashwant Sinha has already questioned it and stated that the very move had made the BJP lose “the high moral ground that we had occupied all these months and years”. Sangh Parivar activists at various levels of the organisation that Frontline interacted with are overwhelmingly in agreement with this point of view.

Weak defence

Naturally, this situation, complete with the strong resentment in relation to l’affaire Jay Shah, manifesting even within the BJP, has come in handy for opposition parties, including the Congress. In fact, the climate created by the revelations seems to have infused Congress vice president Rahul Gandhi with new confidence, and his interactions with the public and the media have become markedly sharp in comparison with those of the past. On its part, the line of political defence adopted by the BJP leadership, including Amit Shah and Railway Minister Piyush Goyal, was seen to be palpably weak and inconsequential. An important line in the political defence prepared by Amit Shah was that the Congress had never made bold to file defamation cases with massive demands for compensation when they faced similar cases relating to financial impropriety, but here the BJP had gone ahead and filed a Rs.100 crore defamation suit against The Wire. He also argued that none of his son's companies had done even one rupee worth of business with the government or received kickbacks like in the case of Bofors.

Injunction issued

Even as this political defence was put forward, Jay Shah obtained a lower court order from Ahmedabad restraining The Wire from publishing any further report on his business turnover. The court said that this was being done “so that the right to live with dignity of the plaintiff (Jay Shah) may be protected”. This order, dated October 12, 2017, expressly admitted that the court had not heard the arguments of the respondent (The Wire website) before issuing the injunction, but it also sought to defend the action by stating that “in the present case, it appears that if an immediate remedy is not given to the applicant, there is a chance of publishing the news, for which the present plaintiff has filed the suit”. Indeed, it is as amazing a contention as the stupendous growth of Jay Shah’s company and is already being looked at sceptically by a predominant section of political observers and the political class, from within the Sangh Parivar too.

As the needles of suspicion point towards the Modi dispensation and the top leadership of the BJP, the grapevine is replete with stories about impending revelations on more financial improprieties, including ones that involve a couple of current and former Ministers. The portents of September-October 2017, say some carriers of this intelligence, seem to be getting heavier and gathering greater momentum.

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