May 31, 2020
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Is The PM Under Scrutiny?

Procedures for the hawala probe seem to meander in the case of Narasimha Rao

Is The PM Under Scrutiny?
Could it be that the hawala scandal is yet to claim its biggest victim? Well, it gets curiouser and curiouser. That the Prime Minister's alleged involvement in the hawala pay-offs is the ruling Congress party's Achilles' heel was exhibited beyond a shadow of doubt on March 11, during the last session of the current Lok Sabha.

An aggressive Opposition punched holes in the Government stand that Narasimha Rao was not under the scrutiny of the CBI nor was the investigating agency following different yardsticks in the hawala case. Atal Behari Vajpayee put the Government on the mat with a simple query to Rao: "Has any member of your personal staff been interrogated by the CBI?" Neither Rao, nor the Minister of State for Personnel, Margaret Alva, who was doing the talking on behalf of the Government, had an answer. Vajpayee rubbed it in, emphasising that this procedure was followed for all the others accused in the hawala case. The treasury benches squirmed some more, and finally the Prime Minister broke his silence: "This question should be put to the CBI".

The CBI, however, is saying nothing ( see box ). And while the Prime Minister's response may have given him a temporary reprieve in the Lok Sabha, official sources told Outlook that there is a clear-cut procedure laid down regarding investigations into verbal allegations such as those made against Rao by S.K. Jain to the CBI (under Section 161 of the Criminal Procedure Code). After his arrest in March 1995, Jain alleged that he had paid Rao over Rs 3.5 crore through R.K. Dhawan, Chandraswami and Satish Sharma. The moot question is—was the procedure followed? The CBI remains tightlipped, but there are clear indications that it was not followed.

According to sources, verbal allegations have to be corroborated with material and documentary evidence. In this case: Were the three conduits for the hawala money present in Delhi during the period specified by Jain? Did the meetings take place as Jain alleged? And did the money actually change hands at these meetings? It may be recalled that S.K. Jain, in his statement to the CBI had claimed that in May 1991, when Rao had just been elected Congress president, R.K. Dhawan took him to meet Rao at his Motilal Nehru Marg residence in Delhi where he deposited Rs 50 lakh in an almirah. He said that he gave Dhawan another Rs 50 lakh for Rao's election expenses in Uttar Pradesh a few days later. Jain also alleged that in June '91, Satish Sharma called him to his farmhouse near Delhi where Chandraswami was already present. He added that the two of them accompanied him to the Prime Minister's residence where Rao told him to pay Rs 3 crore for the party of which Rs 50 lakh was to be paid to Sharma, Rs 50 lakh to Rao himself and the rest to Chandraswami.

Official sources said that raids planned on the premises of Sharma and Chandraswami—necessary to corroborate the specific allegation levelled by Jain—never materialised. According to a senior CBI officer: "To begin the investigations against the Prime Minister, the personal staff members of not only the Prime Minister but also the three conduits and Jain himself should have been questioned." He adds: "The more this is delayed, the more adverse is its impact on the progress of the case. In this regard, memory lapse is a crucial factor."

It is understood that the CBI has not interrogated the Prime Minister at any stage of the investigation as a consequence of the allegations made against him by S. K. Jain nor has it interrogated his personal staff after March 1995, when some initial inquiries are reported to have been made in the days following Jain's statement. But significantly, the apex court has held even after March 1995 that it is not satisfied with the investigations, which is being touted as a possible reason for Rao's disinclination to use the inquiries—wherein his personal staff may well have been questioned—to exonerate himself from the charge that the CBI is playing favourites.

Besides, the facts do not seem to bear out Rao's responses in Parliament on March 9—that no reports are sought from the CBI in such cases—and on March 11—that the CBI would know whether he is being treated on a par with others accused in the hawala scandal. The reason, say senior officials, is that the Government had an assessment of the fall-out of the hawala probe vis-a-vis Rao's alleged involvement, as the Union Law Minister H.R. Bhardwaj, and Solicitor General Dipanker Gupta discussed and formulated the Government response which was communicated to the apex court on February 22.

Consequently, the BJP, on unsure ground in the hawala case despite having put up a brave front, is likely to be the real gainer. Party sources admit that Vajpayee's question was not a spur of the moment move. According to a senior party leader, this aspect of the investigation into Rao's involvement in the hawala scandal is shrouded in ambiguity and the last session of the last day of the 10th Lok Sabha was the right time to focus on it. Especially after the apex court took the CBI out of the administrative purview of the Prime Minister as far as the hawala case was concerned. "And," he added, "Rao's response in Parliament just proves this point."

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