Why is the CBI going soft on Virbhadra Singh?

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Photo: Tehelka Archives
Photo: Tehelka Archives

The CBI inquiry into multiple corruption allegations against the grand old man of Himachal Pradesh, Chief Minister Virbhadra Singh, could be winding up soon. On 1 September, the CBI filed a status report of the preliminary inquiry in a sealed cover with the Delhi High Court. It is not known as to which way the probe is going. But other than the inquiry, the sleuths have not lodged an FIR or registered a case against him, even though two years have passed since the allegations surfaced.

In a similar case last year, the then railway minister, Pawan Kumar Bansal, was forced to resign from the Manmohan Singh Cabinet. His nephew had been caught fixing appointments to the high-powered Railway Board, a forum that can help crooked officials make millions.

It was believed that Bansal’s nephew, Vijay Singla, could not have acted alone and that he required the support of his uncle to make the appointments to the Railway Board. It was also pointed out that Singla had made several calls from the Union minister’s official residence, while his telephone was being monitored.

In 2012, Virbhadra and his wife were acquitted in a high-profile corruption case in which it was alleged that he favoured two corporate entities — Gujarat Ambuja and Mohan Meakin — when he was the chief minister in 1989.

The prosecution built a case that Virbhadra had tried to help Gujarat Ambuja by bypassing the mandated committee of four Cabinet ministers. The prosecution built a case based on an alleged payment of Rs 2 lakh bribe by the company to the chief minister at Himachal Bhavan in New Delhi in the presence of company chairman Suresh Neotia.

In the Mohan Meakin case, the state pollution board had directed the company to build an effluent treatment plant in 1983. Six years later, the board issued Mohan Meakin an ultimatum. Allegedly, in order to avoid the Rs 80 lakh cost of building the plant, Meakin had taken Virbhadra’s approval by paying him a bribe.

In 2007, Virbhadra’s rival in the Congress, Vijay Mankotia (who later joined the BJP), produced a CD containing audio recordings of conversations between the chief minister, the corporate and IAS officer Mahinder Lal (since deceased), who was Virbhadra’s alleged associate. Virbhadra and his wife were booked in August 2009 based on the evidence. According to BJP leader Prem Kumar Dhumal, a forensic laboratory confirmed that one of the voices on the CD was that of Virbhadra, though he denied this in his affidavit.

Usually when scams surface, the CBI has the job of establishing the money trail leading to the accused. In Virbhadra’s case, the money trail is visible, and in some cases, the nature of the graft transaction also seems to be apparent.

While Virbhadra was being acquitted in the other corruption case (based on the audiotapes), the income tax department stumbled upon three large cash deposits made by an LIC agent, Anand Chauhan, into account number 524185 of Punjab National Bank’s branch at Sinjauli, near Shimla, the capital of Himachal Pradesh.

Chauhan made deposits totalling Rs 5 crore between 2008 and 2011 and then issued cheques to pay for the life insurance premium of ‘Veerbhadra Singh Hindu United Family’, comprising the chief minister, his wife and two children. Chauhan told the income tax officials that these were high-value, single-premium policies. In his defence, Virbhadra provided ‘revised’ income tax returns as financial records. These show the politician as a misread beneficiary of a “horticultural marvel” pulled off by the LIC agent.

Virbhadra told the income tax officials that he had an MoU with Chauhan for managing his apple orchards.

Chauhan took over the orchards that had previously been generating an average profit of Rs 10-20 lakh every year. But, according to the ‘revised’ income tax returns, Chauhan managed to reap an additional profit of Rs 6.15 crore. Virbhadra declared that his arrangement with Chauhan resulted in non-taxable agricultural income of Rs 6.5 crore in profit from apples, specifically Rs 2.21 crore, Rs 2.8 crore and Rs 1.55 crore during the fiscal years 2009-10, 2010-11 and 2011-12, respectively.

What is questionable here is that the income tax officials allowed Virbhadra to file revised income tax returns covering three consecutive financial years (2009-10 to 2011-12), three years after the first such financial year in which dubious transactions were discovered.

But, it was not just Chauhan. Virbhadra had an existing, registered agreement with a Bishambar Dass for the same period to manage the same apple orchards for around Rs 10 lakh per year. Chauhan must have been a better farmer because Virbhadra’s MoU with him (disclosed later in 2012) showed a 30-fold increase in the chief minister’s non-taxable income.

Considering Virbhadra’s clout, the MoU with Chauhan would have passed scrutiny, and it did. But, investigations revealed that the entry into the tehsildar’s registry was overwritten.

Land sharks will tell you how easy that is to do by greasing a few palms. Touts outside any land registry office will offer you competitive rates for such services. It is not uncommon to hear of mass transfers of sub-registrars of assurance who register deeds and documents by altering records.

The questionable nature of the agreement between Virbhadra and Chauhan is made clearer by the stamp paper’s authenticity. The tehsildar concerned said that he did not attest the stamp papers for the MoU with Chauhan. Obviously, they had been purchased illegally as touts are known to keep backdated stamp papers for such use. Why would a high-profile politician make so many basic mistakes and have to use wrongly attested stamp paper to record and register an MoU? This could also mean a case of forgery.

When the income tax department’s inquiry concluded, the authorities found that Chauhan could not explain the large cash deposits in his bank accounts except for the banal reply that these were proceeds from the apple sales. Surely, apple sales are not so high that people transact in crores of rupees of cash?

The income tax department was particularly concerned about the Rs 1 crore that was deposited in cash during May 2010 for which Chauhan transformed back to being an LIC agent and issued single-premium policies for ‘Veerbhadra Singh Hindu United Family’.

Such large sums of untaxed money of questionable sources could be labelled as “tainted money”, which provides ground for an investigation by the Enforcement Directorate under the Prevention of Money Laundering Act, 2002.

The money trail appears clear, but where does the CBI come into the picture? That would be at the other spectral end of this pot of gold. At about the time that Chauhan was making deposits into Virbhadra’s bank account, the income tax department’s raids in December 2012 at Ispat Industries premises revealed diaries recording off-the-book cash transactions. Some entries, between 2008 and 2010, were under the head of ‘VBS’, when Virbhadra was the Union steel minister in the scam-tainted UPA government.

Listed under ‘VBS’, there were payments of Rs 50 lakh each on 28 October 2009 and 21 December 2009; Rs 28 lakh on 21 April 2010, and Rs 1 crore on 8 August 2010, as per the seized documents.

There were similar entries in the diaries that hinted at payments made to the Union minister through his aides.

Virbhadra’s defence of the increase in agricultural income extends to his associates as well. Virbhadra and his family received Rs 7.7 crore in ‘unsecured loans’ from a Vakamulla Chandrashekhar, promoter- director of Venture Energy and Technology Private Limited.

When grilled, Chandrashekhar declared to the income tax officials that he lent Virbhadra and family the money from agricultural income generated from his lands in Andhra Pradesh.

The income tax department investigation revealed that neither Chandrashekhar nor members of his family owned the plot of land from which he said he had generated that income. One of the properties he did own had been leased for a paltry sum of Rs 25,000 per year.

Chandrashekhar can only be described as a kind man, exclusively to Virbhadra and his family. The unsecured loans had been given without any interest and there is no known scheme or timeline of repayment, and the source of the funds loaned to Virbhadra are not known.

In 2002, Venture Energy was allotted a hydel power project in Himachal Pradesh. Like previous governments, Chief Minister Virbhadra Singh gave the company a generous 10 months’ extension to complete the project.

In 2012, when Virbhadra contested the Assembly election and eventually became the chief minister, he did not declare these unsecured loans from Chandrashekhar. But, in May 2013, when his wife Pratibha Singh contested the byelection for the Lok Sabha seat vacated by Virbhadra, she declared that she and her husband had taken unsecured loans of Rs 1.5 crore and Rs 2.4 crore, respectively, totalling Rs 3.9 crore, from Chandrashekhar.

A deeper probe into Chandrashekhar’s financial affairs revealed that he had also given similar, interest-free unsecured loans totalling Rs 1.99 crore to companies owned by Virbhadra’s children — Maple Destinations and Dreamland. These transactions were done through the company Chandrashekhar owns, Tarini Sugar and Distilleries. Chandrashekhar also allotted around 10 lakh shares worth Rs 10 each to Virbhadra, his family and an associate in his firm, Tarini Infrastructure.

In 2011, Maple Destinations bought a farmhouse in Delhi from Picheshwar Gadde for Rs 1.2 crore. The authorities grilled the seller, who sought immunity from prosecution by declaring that he had sold the farmhouse for an additional cash component of Rs 5.41 crore.

New Delhi-based Common Cause, which filed a public interest litigation (PIL) on the illegal allotment of coal blocks, has filed a PIL in the Delhi High Court on the allegations against Virbhadra. The NGO has asked for a court-monitored CBI probe, which is yet to happen.

Common Cause has put the value of the scam at Rs 20 crore. It is paltry compared to the Rs 5,000 crore scam that landed former Jharkhand chief minister Madhu Koda in jail — the first chief minister to be put behind bars. But, should the low figure diminish the national outrage against corruption, considering that the person is a career politician?

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