Sucheta Dalal :Most investigations meant to go nowhere
Sucheta Dalal

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Most investigations meant to go nowhere  

Oct 4, 2004


It needed a Public Interest Litigation to reveal that Railway Minister Laloo Prasad Yadav, while launching a high-profile probe into the Godhra episode, was quietly transferring the key officials who had been working his own indictment in multiple scams.


It is the same with the Tehelka inquiry. It is all very well for the government to instruct the inquiry commission not to get into the motives of Tehelka (and apparently those of its financiers). But officials from a variety of regulatory agencies have also been told that they are likely to be targeted by a central government cell, which has been asked to investigate their loyalties and motives.


None of this would have happened without the Prime Minister or the Supreme Leader of the Congress Party blessing the politics of vendetta and escape. After all, the Common Minimum Programme says nothing about not vitiating the administrative machinery, demoralising bureaucracy or discouraging cronyism.


The ordinary person however knows that none of these investigations are meant to go anywhere. They are only aimed at ensuring that every political parties has an arsenal of civil and criminal cases filed against every political leader, when they are in power, to be strategically used for political gamesmanship or as a defence mechanism.


Proof lies in the fact that all political parties, sometimes operating under the aegis of a Joint Parliamentary Committee (JPC), work together to ensure that economic crime is rarely punished.


Otherwise, the investigation into the May 17 stock market crash would have been investigated more seriously to trace those who triggered irrational panic, instead of being glossed over with a white paper.


Similarly, investigation into the former Unit Trust of India (UTI) Chairman’s malafide decisions of 2000-01 that led to an erosion of several thousand crore rupees in unit value would also have been reopened. That investigation had come to a halt when the ex-chairman’s lawyer threatened to expose politicians who had interfered with UTI’s operations.


Or take the case of Ketan Parekh; he is out on conditional bail, having made specific repayment commitments to return over Rs 880 crore to Madhavpura Mercantile Cooperative Bank. He has defaulted on all the commitments. He owes over Rs 100 crore to Bank of India, but a convenient moratorium on repayment ensures that it is not even pursuing recovery. Meanwhile, he remains a free bird.


Similarly, certain scamsters barred from equity markets are reportedly speculating in commodities futures, es pecially guar seeds.


The same lethargic investigation is evident in what is known as the Telgi scam. Everybody knows that the fake stamp paper scam went far beyond Police Commissioners and Senior IPS officials who are languishing in jail. Nobody denies that law enforcers who turn criminals must receive harsh punishment. But it is also a fact that the political intervention from the highest level of the previous government led to the reinstatement of Ganga Prakash in the Nasik security press. It is he who facilitated the sale of security printing machines to Abdul Karim Telgi.


The loot of nearly Rs 3 crore recovered from Excise Commissioner P.K. Ajwani is further evidence of the enormous economic damage caused by rampant corruption. Over time, Ajwani too will get out on bail and an endless trial will let him walk free.


Curiously enough, no stigma seems to attach to politicians; not even when they have been arrested for rape, murder or economic offences. That’s why Mulayam Singh Yadav can openly express support for Amar Mani Tripathi, who is an accused in the murder of his paramour. Clearly, there is enough incentive for a dacoit of the Chambal Valley or significant gangster from Mumbai’s notorious underworld to become a politician.


The justice system is also skewed. Few Indians would deny that Dhanonjoy Chatterjee would probably not have hanged if he wasn’t poor — he would have escaped like the murderers of Jessica Lal. Such bias is even more open when it comes to economic offences.


Ravinder Singh, a dogged activist says, ‘‘There is complete lack of interest among politicians, executives and the judiciary to prosecute white-collar criminals. Each of them is corruptible. The courts even shuttle around cases of cheque bouncing (under Section 138) for years on procedural grounds sometimes just to determine whether a notice was served within 15 days or not. They find the flimsiest grounds to delay and derail justice.’’


He and other consumer activists have found that the situation is even worse in consumer courts. Occasionally, there are positive judgements but there are too many instances of deliberate delay.


Cases drag on for three to four years; they are quickly dismissed if the complainant misses a date, but rarely if the opposite party fails to reply or turn up. Compensation, when awarded, is usually so niggardly that it discourages consumer activism. Yet, the Consumer Protection Act clearly provides for class action penalties and damages.


Recently, the Securities Appellate Tribunal (SAT) has been giving sympathetic hearings to several large corporate houses, who have argued their appeal against orders of the Securities and Exchange Board of India on the grounds that regulatory strictures or penalties would ‘taint’ their reputation.


SAT slashed penalties slapped on two Motawani group companies Roofit Industries and Sunearth Ceramics citing their inability to pay. The two companies owe over Rs 1500 crore to fixed desposit holders, banks and inter-corporate lenders.


Contrast this with the US where the biggest corporate houses, audit firms, brokerages, mutual funds and consumer services companies cough up hefty penalties for economic offences and on consumer complaints. They usually pay up with some protest but work harder at improving their services. In India, companies will move mountains to avoid the smallest fine or the hint of regulatory indictment.


Only the judiciary can help make a difference now. But it has to clean up its own act first, speed up the trail of economic offences, start handing out exemplary penalties, aid the disgorgement of swindled money and deal sternly with politically-motivated investigations that end up in court.


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-- Sucheta Dalal