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The Drug Mela

The CBI pins Mulayam-aide Balram Yadav in a Rs 47-crore scam

The Drug Mela
outlookindia.com
-0001-11-30T00:00:00+0553

DESPERATE efforts are underway in Uttar Pradesh to ‘Save the Endangered’ in the Rs 47 crore ayurveda scam that has led the Central Bureau of Investigation (CBI) to Balram Yadav, the state’s health minister during the Mulayam Singh Yadav regime. The path of the agency’s investigation proceedings is being strewn with heaps of destroyed documents, fabricated records, and backdated notings incorporated in files after the scandal surfaced two years ago.

As scams go, this one is the oldest in the book. Medicines were authorised for purchase by the state Ayurvedic and Unani Services (AUS) department at vastly inflated prices. Sample: liquid paraffin was bought at Rs 110 per bottle when the market rate was Rs 18. What’s unique here is that Balram Yadav personally intervened on behalf of the AUS director Shiv Raj Singh for release of money to buy the drugs. And when the Finance Department refused to play ball, he took the request to Mulayam.

The AUS had initially sought Rs 76.27 crore for 1993-94. But the Finance Department sanctioned only Rs 44.26 crore. A supplementary demand of Rs 38.94 crore was made in December. When the demand couldn’t be justified, Singh made a fresh proposal in February. The amount now sought was a mere Rs 2.98 crore. But the finance department turned down that demand, too. It was then that Singh approached the government for Rs 13.47 crore from the state contingency fund.

The Finance Department put its foot down yet again. But this time Singh didn’t give up. He sent the file to Balram Yadav, who requested Mulayam to comply. The chief minister, however, sent the file back to the department for comments "within two days". It was March 25, 1994. Time was running out. The financial year was coming to an end. By then, an official in Kanpur got wind of the scam, and reported it to higher-ups in Lucknow, and word was out.

The CBI was told to take over the investigations from Uttar Pradesh Police by the Lucknow High Court this year. And after seizing documents and interrogating 35 officials in the ayurvedic department, the CBI has confirmed that the racket was being run by AUS director Shiv Raj Singh; drawing and disbursing officers (DDOs); and local medicine dealers, in connivance with some officials in the departments of finance and medical education. The agency will submit its progress report to the high court on November 26.

The modus operandi was simple: Singh would send an inflated budgetary proposal to the Finance Ministry for the purchase of ayurvedic medicines from private dealers all over the state. If the ministry refused to accommodate and asked him to justify the demand, a fresh proposal seeking fewer funds would be sent.

In the meantime, without waiting for the ministry’s sanction, Singh would issue fund allotment letters to the DDOs, instructing treasuries to release the money. Treasuries usually do so on production of the allotment letters from the AUS chief. But in this case, the treasuries were being conned into releasing the money without the state government’s sanction.

 "For years, treasuries kept releasing the money on the basis of fraudulent allotment letters. The scam amount may be much much higher than Rs 47 crore," said a CBI official. According to the agency officials, the practice was in existence much before Mulayam had become chief minister. Surprisingly, the fake allotment letters were not sent to the DDOs through official channels. Drug dealers would themselves come to the Ayurveda Directorate in Lucknow and collect the letters from the AUS, after paying the mandatory 15-25 per cent cut to the powers that be. "A mela-like situation emerged in front of the directorate during October-November 1993 and March 1994," says an investigator. 

During raids conducted in Lucknow and other parts of the state, the CBI seized a ‘hawala type’ diary from a dealer’s house and a loose account sheet detailing allotment orders worth Rs 16.58 crore issued by Singh.

With the CBI all set to nail those involved and the high court keeping an eye on the progress of the case, heads are likely to roll. And the moot question is: how much further will it embarrass the already-beleaguered Mulayam? 

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