THE first chargesheet filed in the fodder scam by the CBI gives damning evidence of direct payments made to Bihar chief minister Laloo Prasad Yadav. Numbered RC-20 (a)/96, it has confessions from the main suppliers, contractors of animal husbandry products and junior officials that payments were made to Laloo through conduits—usually the key scam-accused R.K. Rana, K.M. Prasad and S.B. Sinha. Till now the allegations against Laloo seemed to suggest that the chief minister was only guilty of negligence and that he had only shown favours to those involved.
According to well-placed sources, the CBI is preparing the case to file at least three more chargesheets—numbered RC-38 (a)/96, RC 42 (a)/96 and RC 64 (a)/96—relating to massive illegal withdrawals from district treasuries at Dumka and Deogarh and the patronage extended to scamsters by the chief minister despite enough indication that large sums were being siphoned off without any accountability to the state legislature.
CBI officials indicate that they are working on three other chargesheets as well—RC 37 (a)/96, RC 39 (a)/96 and RC/ 44 (a) 96—and claim to have found sufficient evidence of a quid pro quo: that money was exchanged for certain decisions taken at the highest levels of the state government.
By all indications, the chargesheet, which has been already filed, refers to the withdrawal of Rs 37 crore from the Chaibasa district treasury—where the allotment was actually Rs 14 lakh—and the confessions of a big-time animal husbandry supplier Dipesh Chandak, whose statement made before a first class judicial magistrate in Dhanbad is considered crucial to the probe.
Chandak, who was close to Sinha and usually stashed the scam money he received from him in his own godown, says details of the funds given to Laloo were provided to him by Sinha himself. In fact, the first account of payments made to senior politicians and officers came from his statement.
"In June 1992, I remember a time when Dr S.B. Sinha was staying at Hotel Ashok Patliputra, Patna, and he asked me to take Rs 1 crore to Patna. When I reached there, I also stayed with him. The next day, I, along with him and Dr S.K. Singh and Dr R.K. Rana, left for Delhi by air. At Delhi, we stayed at the Hyatt Regency and Dr Rana took away all the three suitcases with the money. As I was close to S.B. Sinha, he told me that this amount was paid to Laloo Yadav, CM of Bihar, through Rana. I always carried money to Patna by the Rajdhani train and always used fake names...."
Chandak, who is in custody and is being extended a massive security cover, claims Sinha often told him names of the people who were being paid off by the fodder mafia. "Sinha knew Laloo before he became chief minister and he used to pay him directly or through Rana. When the election for the post of chief minister in 1989 (came up), Laloo met Sinha at a guest house in Srikrishnapuri, Patna, where Sinha used to stay at that time. This guest house was taken on hire by T.N. Prasad (another scam-accused). Laloo came and asked him for some money to purchase some MLAs. Sinha paid him Rs 5 lakh (he told me) and Laloo became chief minister. After this, Sinha used to meet him regularly at Patna or Delhi and he was paid regularly." According to Chandak, this money was drawn from the Chaibasa treasury.
Officials say there have been other significant confessionals which form the thrust of charges framed against Laloo. Particularly incriminating is the statement of another top animal husbandry contractor, Vijay Mallik, who dragged Rajya Sabha MP and industrialist Prem Gupta's name into the scam. Gupta, according to Mallik, managed Laloo's finances. "In June 1993, when I was in Delhi, there was a phone call from Laloo at our room at Hyatt Regency. He called Sinha to Bihar Bhavan to meet him immediately. Sinha rushed off and came back after one-and-a-half hours. As soon as he came, he asked me to bring Rs 1 crore in the morning because he had to pay the same to Prem Gupta on Laloo's advice."
According to the statement, the money was handed over by Malik to Prem Gupta—this soon became a regular fixture. Prem Gupta, regarded as being "very close" to Laloo, accompanied the chief minister on his trip to Singapore and the US. CBI sleuths say that though Prem Gupta hails from a modest background, the rise in his financial career graph coincides with the upswing in Laloo's political fortunes.
Well-placed sources say that two other damaging confessional statements have been recorded before judicial magistrates. Umesh Prasad Singh, an employee in the state secretariat at Patna, told them that he used to carry sacks filled with notes for the chief minister in his own rickshaw, so that no one suspected anything. The rickshawpuller also confirmed this to the CBI. Another key witness is government employee R.K. Das, who is said to have some "highly incriminating" documents and the detailed modus operandi of how money was paid to the chief minister and his coterie.
Apart from the damaging confessions made by several accused, the proposed CBI chargesheets point at the conspiracy and connivance of Laloo and former chief minister Jagannath Mishra in promoting officials working with the fodder mafia, facilitating their stay in posts far longer than the norm. The case of Ram Raj Ram, director, animal husbandry, is typical of the happenings in the department.
While Laloo repeatedly recommended and even granted extensions to Ram Raj Ram, a team of auditors discovered that the presence of their boss at the Ranchi office, which oversees the districts of Ranchi, Doranda and Chaibasa, and his frequent travels to Delhi invariably coincided with huge withdrawals from the district treasury.
So, when Ram Raj Ram landed in Ranchi for two days between August 22, 1993, to August 24, 1993, Rs 4.54 crore was fraudulently withdrawn; between August 25, 1993, and November 11, 1994, when the director was travelling between Delhi and Ranchi, Rs 3.97 crore was removed; on September 12, 1993, when he was in Ranchi for the day, Rs 10 lakh was pulled out; the next day he left Ranchi for Delhi again, and another Rs 2.76 crore was withdrawn; on September 15, 1993, when Raj Ram returned to Ranchi,another Rs 79 lakh was withdrawn.
The pattern repeats itself. Between February 9, 1994, and February 10, 1994, when Ram Raj Ram was in Ranchi, Rs 5.38 crore was taken out from the treasury; Rs 8.45 crore was withdrawn between February 11 and February 19, 1994—the period he spent in Delhi. And this when Ram Raj Ram was facing a vigilance inquiry for a 1990 embezzlement case.
The case of the key scam-accused Sinha is even more curious. He was to retire on February 31, 1993. On February 4, he wrote to the director, animal husbandry, that he be given a two-year extension. On December 7, 1993, Jagannath Mishra, then leader of the Opposition, forwarded his case to the chief minister "in order to maintain the pace and progress of the work done in the Chhotanagpur region. "
Laloo promptly complied with Mishra's request. Meanwhile, an order was issued by the secretary, animal husbandry, that Sinha could continue in the post, but when the file was sent to the finance department, it opposed it on the grounds that the job did not involve 'public interest'. The file was sent back to Laloo, who also holds the finance portfolio, on January 18, 1994. Laloo sent back the file to the finance department on December 31 1994, overruling the secretary's objections. For six months, Sinha continued in office without any formal ratification from the council of ministers.
The proposed chargesheet points out that in the Ranchi region itself, some of the key accused officers were posted for years, promoted not just by Laloo but previous chief ministers as well. For instance, Chandra Bhushan Dubey was posted as provincial district officer, Ranchi, in the animal husbandry department for 20 years; another top accused Gauri Shankar Prasad remained district officer for 16 years; B.K. Singh, head of the Hazaribagh region, stayed in the same post for 20 years. There are several other such postings. Says the chargehseet: "In all cases, an interim order to the effect that the officers will continue to work on the same post after the date of retirement was issued by the animal husbandry department. The approval of finance minister and council of ministers was obtained ex-facto which was against the provision of rules and orders of the government."
Other salient features of the proposed chargesheets:
- In April 1991, Laloo ordered the suspension of the district animal husbandry officer of the district animal husbandry officer, Chaibasa, for illegally withdrawing Rs 50 lakh. The necessary notification was issued but within a fortnight, the government stayed the suspension and posted the officer on the same job to Ranchi, the scene of the heaviest withdrawals.
- In September 1993, joint director animal husbandry Shiv Balak Chowdhary submitted his inquiry report saying that Rs 200 crore had been embezzled. The state animal husbandry commissioner endorsed the decision but within two days, both the officials were transferred out summarily.
- The director general of the state vigilance ordered an inquiry into the scam and sought a report within a week but was restrained from going ahead on the plea that the Public Accounts Committee was probing its charges. The PAC, at the behest of the chief minister, pointed out that "irregularities committed in Chhotanagpur are under investigation. During the pendency of the case before the PAC, investigation of financial irregularities pertaining to these offices by any other agency will be irregular". Subsequently, two members of the PAC, Dhruv Bhagat and Jagdish Sharma, have been chargesheeted and put behind bars.
CBI officials say the irregularities are of such magnitude that investigations could take several months. What has come as a big blow to the investigating agency is the fact that despite the overwhelming evidence of the payoffs, Jagannath Mishra got bail last week. Considering that Laloo has also applied for bail in the same court, CBI officials can only wonder if their investigation will set a new trend.