The collapse of a forgery case

Published : Nov 19, 2004 00:00 IST

The acquittal of Chandraswami by a Special Court in the case for lack of evidence raises questions about the CBI's ability to investigate efficiently cases involving influential persons.

in New Delhi

THE St. Kitts forgery case was one of the three cases of corruption registered against former Prime Minister P.V. Narasimha Rao after he demitted office in 1996, following the Congress' rout in the general elections that year; the other two were the Jharkhand Mukthi Morcha (JMM) bribery case and the Lakhubhai Pathak cheating case. Together these cases had symbolised the erosion of ethical values in the polity during Narasimha Rao's five-year rule.

As such, the legal course these cases took after the end of Narasimha Rao's term in office evoked considerable public interest. For the first time, a former Prime Minister was being prosecuted for offences allegedly committed by him while in office, and therefore it reinforced people's confidence in the rule of law.

In the JMM bribery case, Narasimha Rao was convicted by the trial court but acquitted by the Delhi High Court. Both in the Lakhubhai Pathak cheating case and in the St. Kitts case, the trial court acquitted Narasimha Rao and his associates; in the St. Kitts case even the Supreme Court upheld his acquittal.

Therefore, the acquittal of godman Nemi Chand Jain alias Chandraswami, a co-accused (along with Narasimha Rao and others) in the St. Kitts forgery case, by Special Judge Dinesh Dayal in New Delhi on October 25 for "lack of evidence" once again raises questions about the ability of the Central Bureau of Investigation (CBI) to pursue cases against highly placed individuals or persons with contacts in centres of power.

The St. Kitts case (St. Kitts is a small island in the Caribbean) had its origin in 1989, during the run-up to the general elections to be held later that year. V.P. Singh, who had quit as Finance Minister in the Rajiv Gandhi Cabinet following the Bofors expose and had emerged as the force that rallied the Opposition parties, was Rajiv's main challenger.

From November 1988 to October 1989, Narasimha Rao was the External Affairs Minister in the Rajiv Gandhi government, and K.K. Tewary was his Minister of State. Chandraswami was Narasimha Rao's spiritual guru and also an associate, as he had been to several other political leaders. K.N. Aggarwal alias Mamaji was Chandraswami's private secretary. All the four, along with a few other key persons, were accused of forging documents against Ajeya Singh, son of V.P. Singh, to show that he had opened a bank account in First Trust Corporation Bank in St. Kitts and deposited $21 million in it, making V.P. Singh its beneficiary.

The story first hit the headlines in the Indian media, following a report in the Kuwait-based Arab Times newspaper, in August 1989. The Rajiv Gandhi government asked the Enforcement Directorate (E.D.) to probe the matter. In October 1989, the E.D.'s Deputy Director, A.P. Nandy, visited St. Kitts and later presented a report to Parliament. It was only after V.P. Singh became Prime Minister in December 1989 that the CBI registered criminal cases against Enforcement Director K.L. Verma, Chandraswami, K.N. Aggarwal, arms dealer and Chandraswami's associate Adnan Kashoggi's son-in-law Larry J. Kolb, and First Trust Corporation's managing director George McLean.

According to the case, it was Kolb who managed to insert the news item in Arab Times on August 20, 1989, which was reproduced by sections of the Indian media. Kolb, with Chandraswami, also arranged the visit of Nandy to St. Kitts in a private plane.

In St. Kitts, Nandy obtained letters and documents showing the details of the bank account allegedly opened by Ajeya Singh, from McLean. Nandy then got these documents, which allegedly carried the signatures of Ajeya Singh and V.P. Singh, attested by R.K. Rai, then Consul-General of India in the United States, and Deepak Sen Gupta, Deputy Consul-General in the U.S., the CBI said.

Both Ajeya Singh and V.P. Singh soon denied any connection with the account. The CBI sent these documents to the handwriting experts at the Central Forensic Science Laboratory, New Delhi, and on the basis of their report, concluded that the signatures of Ajeya Singh and V.P. Singh in the documents were forged, on the model of their signatures found in their passport applications, which Tewary managed to secure through official influence. Narasimha Rao's role was allegedly confined to asking R.K. Rai to attest the forged documents.

The case, first registered by the CBI in May 1990, dragged on until the People's Union for Civil Liberties moved the Supreme Court in February 1996 seeking disclosure of the CBI's findings. It was only after Narasimha Rao demitted office that the CBI, under directions from the Supreme Court, pressed for Narasimha Rao's prosecution in the case, and charge-sheeted him along with the others in September 1996.

The trial court discharged Narasimha Rao and Tewary in June 1997, as the CBI failed to substantiate its charges. Nandy and McLean died before the filing of the charge-sheet. The CBI did not seek the arrest of Tewary and Kolb, and they were not summoned for trial before the court. "Mamaji" died on August 31, 2004 and the only accused left in the case was Chandraswami.

In the Special Court's judgment, the evidence against Chandraswami is contained in the statement of Suresh Chander Gupta, the then Second Secretary in the High Commission at Trinidad and Tobago in October 1989. Gupta had gone to St. Kitts, under instructions from the Additional Secretary, Ministry of External Affairs, to obtain a letter from the Government of St. Kitts relating to the investigation into the case. Gupta met the Prime Minister of St. Kitts, who asked him who Chandraswami was and what post he held with the Government of India. The trial court has held that the question posed by the Prime Minister of St. Kitts "may or may not have been related to this transaction. He may have heard of Chandraswami in any context, and may have raised the question when he met Gupta". The Judge thus gave the benefit of the doubt to Chandraswami.

The Special Court had also before it the evidence of Arif Mohammed Khan, former Union Minister and an associate of V.P. Singh, who stated that Chandraswami had shown him a paper carrying the details of the bank account in St. Kitts allegedly opened by Ajeya Singh, to be conveyed to V.P. Singh. When Khan conveyed this to V.P. Singh, he did not pay much heed to the same and refused to meet Chandraswami, the judgment says.

Is this a sufficient reason to reject this piece of evidence? V.P. Singh might have refused to meet Chandraswami to discuss it as he perhaps believed that the godman was trying to blackmail him with a concocted story. V.P. Singh has described Chandraswami's acquittal as "unfortunate".

The court held, citing a Supreme Court judgment in another case, that if the prosecution relies upon circumstantial evidence, a clear link has to be established and the chain has to be completed, and allegations of conspiracy cannot be accepted on the basis of incomplete evidence.

The court thus pointed out that in the absence of the evidence of Nandy, who died, it cannot be said that Chandraswami provided any assistance to Nandy in going to St. Kitts from Miami in the U.S. or even that Chandraswami had met Nandy in Miami, as alleged by the CBI.

The acquittal of all the accused cannot but keep the mystery of the case alive. N.K. Singh, former Joint Director of the CBI, who handled the case until 1991 when he was shifted to the Border Security Force, has asked why the CBI did not pursue the case against K.L. Verma after the High Court discharged him from the case for lack of a sanction order.

Contrary to what the judgment says, N.K. Singh has claimed that Nandy had confessed in the court and was to be made approver before he died. Nandy, it appears, had confessed that he had met Congress leader R.K. Dhawan at the instance of his director K.L. Verma, before proceeding to St. Kitts.

N.K. Singh has also revealed that Shiv Kumar, the then High Commissioner at Port of Spain (Trinidad and Tobago), who deputed Suresh Gupta to meet the Prime Minister of St. Kitts, had made serious allegations in writing to the Cabinet Secretary about the intimidation and coercion used by Kolb and Mamaji.

It remains to be seen whether the CBI will appeal against this judgment in view of the inconsistencies in it.

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