'Look At It Objectively'

Speaking against the motion for condemnation of the the alleged involvement of some Indianentities and individuals as non-contractual beneficiaries of the United Nations'Oil-for-Food-Programme in Iraq, as reported in the Report of the United Nations'Independent Inquiry Committee (Volcker Committee).

Source: Verbatim uncorrected proceedings of the Rajya Sabha

P. Chidambaram

Mr. Deputy Chairman, Sir,nearly 18-19 hon. Members have spoken on the debate initiated by my good friend,Shri Arun Jaitley. It's been many months since Arun and I had stood up either onopposite sides or on the same side. It's always a pleasure to hear him. When hehas a very strong case, he is very brief. But when he has a poor case, he needs70 minutes. Sir, I don't wish to get into a legal debate. Most of the legalissues have been splendidly answered by my good friend, Shri Kapil Sibal, theMinister of State for Science and Technology. 

The point is even on the VolckerReport, we heard two very persuasive legal arguments. Two lawyers of eminence,Shri Jaitley and Shri Sibal, did not agree whether this constitutes a reportwhich can be acted upon or a report which has to be further investigated. Infact, they did not agree whether what is in the report is evidence orconclusions. I could be partisan and say I agree with Shri Kapil Sibal which Ido. 

But please look at it objectively. Please look at it objectively from theobjective chair that you sit on. Here is a document which is clearly not ajudgment. If the judge had written this report, would he not have said in theannexures, the list of witnesses, the list of exhibits, the list of documents,etc.? Nothing is there in the report. These are what we call 'conclusions' andno one is questioning the liberty of the Volcker Committee to reach'conclusions'. They reached the conclusions. These conclusions may be right ormay be wrong. These conclusions have been reached in a particular manner which Iwill demonstrate. That may accord with our sense of propriety and fairness; thatmay offend our sense of propriety and fairness.

Let me give you one example.Would my friend, Mr. Jaitley, support the conclusions if I am able to show thatno notice was given to many of the people named in that conclusion? He says theJustice Pathak Inquiry Authority is an eyewash because Section 8B power is notgiven to Justice Pathak. I will deal with that later. Let us take to principleof Section 8B. Section 8B of the Commissions of Inquiry Act says, if at anystage of inquiry the commission (a) considers it necessary to inquire into theconduct of any person or (b) is of opinion that the reputation of any person islikely to be prejudicially affected by the Inquiry, the Commission shall give tothat person a reasonable opportunity of being heard in the inquiry and toproduce evidence in his defence.

According to Mr. Jaitley, which I don't agree, since this power is not givento the Justice Pathak Inquiry Authority, the Justice Pathak Inquiry Authority isan attempt to whitewash or close the matter. What is contained in Section 8B isa universal principle of law. It is not peculiar to the Commissions of InquiryAct. It is not unique to Indian jurisprudence. No man shall be condemned beforehe is heard. Do we agree on that? Did Volcker...(Interruptions)...

SHRI ARUN JAITLEY: Then, why did you not give Justice Pathak that power?

I will answer. I told you I will answer that Arun. Isaid I will answer that when I come to Justice Pathak. I am now taking a pointto illustrate the flaw in Volcker at this stage. We all agree that no man should be condemnedbefore he is heard. Did the Volcker Committee give notice to Mr. Natwar Singh?The answer is no. Did the Committee give notice to the Congress Party? Theanswer is no. Mr. Volcker's Committee itself says, we gave notice only to thecontracting parties, and the contracting parties in the oil cases were 139, andthe footnote says, by inadvertence, we did not give notice to 12 of them. So,what is this report which can be acted upon immediately, which reaches aconclusion, maybe, a right conclusion, maybe, a wrong conclusion, without givingnotice to the persons who it proposes to name? That is why we say, this reportdeserves that much respect. But it is not a document which can be acted uponimmediately. 

Sir, that argument I simply used to say, let us not set too muchstore by this report. I am not rubbishing it. If we had been rubbishing it, wewould not have done all that we have done in the last 20 days, and we have nottaken 200 days to do it. We have not taken 4 years to forestall an inquiry. Wehave acted in the space of 20 days, and I will tell you where it is presently.Let us try to understand what this OFFP was - Oil for Food Programme.

Mr. Jaitleydid bring out most of the facts. But I think, he left out some other facts. Nomotives should be attributed. How has it worked this way? Iraq was allowed tosell oil under the UN-supervised programme. The price of oil was fixed by a UNCommittee or a UN-Appointed Committee. Iraq was allowed to choose the purchaser.As Mr. Sibal said, for four years, this programme ran, as it should have run. InSeptember 2000, the Iraq Government decided that it needed money, it neededmoney for milk, it needed money for pharmaceuticals, it needed money for wheat,it needed money for books, it needed money for children and its people. 

So, theydecided that here is a market where the price of oil is higher than the UN-fixedprice. Can we make a little more money in the market, yet give to the UN theUN-fixed price? Therefore, are we trading in the market? It is not for us tostand up here and say whether that is right or wrong. That was a decision of theGovernment of Iraq. When they found that the market was willing to take Iraqioil for a higher price, they chose the contracting party, and in the two casesbefore us, it was Masefield, the contracting party was Masefield. Up to that,Mr. Jaitley is right. 

But what does Masefield do? Masefield is a trader, like inmany other cases, the contracting party was a trader. In this case, to the bestof what we can gather from the report, I am not going beyond the report,Masefield appears to have sold it to Vittol which was an oil company. Vittolpaid the market price. Masefield paid to the UN the UN-quoted price. There was adifference. That difference, the whole or part--I do not know yet--went intoIraq-controlled Jordanian bank account. This is what happened. The question is,Masefield made its profit by selling it to Vittol. The UN got its price becausethe UN got its fixed price. The difference, the whole or part. went into aJordanian account. If the whole had gone into a Jordanian account, there isnothing more in this case. If a part of the difference went into a Jordanianaccount, the question arises, where did the remainder go? Mr. Jaitley was wrongwhen he talked about the illegality attached to the surcharge. The surchargepart was not the illegal part. Let us look at the facts in this case. 

The facts, in this case, will show that in thecase of contract M9/54, the Iraqi Government levied a surcharge of 4,98,973dollars and Masefield paid, more or less, the same amount, that is, 4,98,518dollars. There is no illegality attached to that. That is a payment which wentto the Iraqi-controlled Jordanian account. In the other case, the Saddamadministration levied a surcharge of 2,50,224 dollars and Masefield paid2,50.022 dollars. That is all what the Volcker Committee says. It says that asurcharge was levied by the Saddam administration and the contracting party paidthat surcharge. The Volcker Committee does not say anything about any otheramount. This surcharge, as we can find from Table-5, was indeed paid by twonamed entities called Hamdan and Andaleeb. Masefield caused or routed thepayment through Hamdan and Andaleeb. Therefore, there is a fair presumption. Ifthe names of Hamdan and Andaleeb rightly occurred there, no notice appears to begiven to Hamdan. We don't know about it. No notice appears to be given toAndaleeb. We don't know about it yet. It may have done gratuitously. That isdifficult to believe. It may have done for another payment. But that is notthere in the Volcker Committee Report. I hope I am making myself clear. 

What islevied as a surcharge was indeed paid. The question is: Was there anything morethan a surcharge? Did it go into anyone's pocket? Where is that money? How muchis it? Who paid whom? Who got what? Where did it go? These are questions towhich the Volcker Committer has no answers. Why? Because the Volcker Committeewas not interested in those questions. The Volcker Committee was only interestedin finding out whether the Saddam Government got a surcharge and the VolckerCommittee found that the Saddam Government got a surcharge. But there are, atleast, many Members, including someone from that side, who will stand up and saythat the Saddam Government was entitled to get a surcharge. Who are we to judgethe Saddam Government? Their children were starving. Their people were dying.They levied a surcharge. They got a surcharge. They might be right or wrong. Whoare we to judge that? What we are concerned with is that if anyone got anyamount other than the surcharge. 

Now, I ask myself, most respectfully, aquestion. Is there anything in the 600 odd pages which shows that the VolckerCommittee looked into any amount other than the surcharge or who paid that, whoreceived that, where did it go and where did it end now. My respectful answer isthat there is nothing in the Volcker Committee Report because the VoclkerCommittee was not concerned with that part at all. We are concerned with thatpart and because we are concerned with that part, whether that part, ifestablished, and all other available facts are established, will link any of thenon-contractual beneficiaries; we have to investigate that matter. But I can'tsay anything more than what I have said why we are having an investigation.

Now, Mr. Sibal raised all the questions. If you presume that the CongressParty received money, if you presume that Mr.Natawar Singh received money, ifyou presume that one might have got a voucher, if that is the starting point ofthe debate, the debate is over. That should be the finishing line of the debate.You must start with facts. All my lawyer friends in this House know that we needfacts or evidence and then reasoning to reach a conclusion. The famous SupremeCourt judgement says that reasoning is what links facts to a conclusion. TheVolcker Committee Report contains conclusions. The Volcker Committee may have ormay not have reference to facts. We don't know them. But we must have thosefacts before we can reason logically whether those facts, those evidence, thosedocuments lead to the conclusion of the Volcker Committee. Since we don't havethose facts, since we don't have that evidence, since we don't have thosedocuments, since they are not listed in the Volcker Committee Report, sincethere is no annexure of exhibits, since there is no annexure of oral evidencetaken, we are now engaged in finding out what the primary evidence is, which, ona process of reasoning, will lead to the conclusion. 

Well, we are talking about primary evidence andsecondary evidence; we are not talking legal gobbledygook. We are talking commonsense. The primary evidence is the document. Primary evidence is somebody's oralevidence that I have seen this; I have heard this; I was present there. We donot have that evidence so far.

Now Sir, the history of these barrels and numbers is very interestinghistory. It is not as though it suddenly came up only in the Volcker Committeereport. In fact, as early as 25th January, 2004, Al-Madapublished the list. I think Shri Sitaram Yechury referred to that. On 29thJanuary, 2004, MEMRY, which Mr. Sibal had cited, published what itthought or which it gathered, as a list. Now the names mentioned in those listsare different. The quantities mentioned in those lists are different. In onelist, the quantity mentioned is million barrels. In another list the quantitymentioned is 5.5 million barrels. In another list, the quantity mentioned is 4million barrels. Then Volcker mentions 1.936 million and 1.1000 million. Whichis correct and which is wrong?

In the meanwhile, it appears that the IndianAmbassador did write a letter to the Government of India on the 28th January,2004. The evidence shows that the letter was in the knowledge of, at least, theForeign Secretary. The letter was also in the knowledge of the then PrincipalSecretary to the Prime Minister. I cannot say anything beyond that. If a letterof January, 2004 was in the knowledge of the Foreign Secretary and also in theknowledge of the Principal Secretary to the Prime Minister, what prevented theGovernment from taking action on that letter? Therefore, even the thenGovernment appears to have.....

SHRI YASHWANT SINHA: Mr. Minister, would you yield for a minute? Sir, thequestion of the letter has been raised in this House.

SHRI P. CHIDAMBARAM: Somebody raised it.

SHRI YASHWANT SINHA: Somebody else raising it is one matter.

SHRI P. CHIDAMBARAM: You said, "I will clarify it".

SHRI YASHWANT SINHA: Just a minute. Sir, as a Minister of the Government, whois replying to the debate on this very important issue, his raising this matteris something very serious. (Interruptions).

SHRI P. CHIDAMBARAM: Sir, I am sorry to say that.. (Interruptions).

SHRI YASHWANT SINHA: Sir, he has referred to the letter.

SHRI P. CHIDAMBARAM: Sir, the record will show that when this issue wasraised by a Member of the RJD, I was out of the House for a few minutes. Mr.Yashwant Sinha said, "He has no access to official records now. It is forthe Government of the day to say whether any such letter was received andindicate what action, if any, was taken." This is what the record willshow. Therefore, I am responding.

SHRI YASHWANT SINHA: Therefore, I am making this point that a letter wasreceived. Now a Minister of the Government who has access to the record, ismaking an assertion in this House that such a letter, indeed, was received bythe Foreign Secretary. He is also making an assertion that the PrincipalSecretary to the Prime Minister, at that point of time, who is not present inthis House, was privy to the letter. Therefore, it is incumbent on the hon.Minister to place a copy of the letter on the Table of the House. He must placea copy of the letter on the Table of the House. He cannot refer to a documentwithout placing it on the Table of the House. He has access to the document. Whyis he referring to it tangentially? (Interruptions). Sir, I will tell you as towhat has happened. What has happened is that there has been a selective leakageof that letter to certain people and this is a deliberate ploy and veryunfortunate tactics which this Government has adopted. ...(Interruptions).... Itis a selective leakage of that letter. Why don't you come clean? Place it on theTable of the House. This is my demand.

SHRI KAPIL SIBAL: Sir, the existence of that letter cannotbe a deliberate ploy. Either the letter exists or it does not exist.

SHIR SITARAM YECHURY: Sir, here is a copy of that letter. (Interruptions).

SHRI YASHWANT SINHA: Sir, this is a selective leakage. How has he got accessto that letter? How has the Minister not got ....(Interruptions).

SHRI SITARAM YECHURY: Sir, I have taken a fax mail from the Navbharat Times.It was printed in the Navbharat Times.

SHRI YASHWANT SINHA: So, somebody has made it available to the NavbharatTimes. How did the media get access to the Government document? (Interruptions)Sir, the point I am making is,...(Interruptions)

SHRI KAPIL SIBAL: Our concern is that you also had an access...

SHRI YASHWANT SINHA: Now, this House cannot be taken into confidence withregard to the documents, thousand pages of that, which have been brought out byMr. Virendra Dayal! But, selectively, they will leak a portion of thosedocuments and say, "We are clean." I demand, under the Rules, thatthat letter be laid on the Table of the House, and let the Minister kindly proveto this House that the then Principal Secretary to the Prime Minister was privyto this. And, what is this that they are saying? They are saying that there werereports in the Pakistani newspapers, in the Iraqi newspapers, which was underoccupation, and they say that we did not act on it. And, is that the reason whyyou would not act on Volcker?

SHRI P. CHIDAMBARAM: Sir, I was being extremely fair, I thought, when I saidthat according to the records, it appears that the letter travelled at least upto the Foreign Secretary and at least up to the Principal Secretary to the PrimeMinister. I was very careful to say that it did not travel beyond as far as I amable to find out. I was being extremely careful when I said that this hadtravelled up to the Foreign Secretary and up to the Principal Secretary to thePrime Minister. We have no difficulty; a copy of the letter which travelled upto the Foreign Secretary and which travelled up to the Principal Secretary tothe Prime Minister will be handed over to the Chairman...(Interruptions)

SHRI DIPANKAR MUKHERJEE: Does it exist?

SHRI YASHWANT SINHA: How can I say when I had no access?

SHRI P. CHIDAMBARAM: Sir, I did not mention this in the other Houseyesterday. I was forced to mention this here because I was told, in the fewminutes I was not here, that Mr. Yashwant Sinha said that I should respond tothis statement made by the hon. Member from the RJD. If you had not said that, Iwould not have responded. You invited this response, and I am giving you theresponse...

SHRI YASHWANT SINHA: Lay the letter on the Table of the House.

SHRI P. CHIDAMBARAM: I will; we will give the letter...(Interruptions)

SHRI DIPANKAR MUKHERJEE: It is not a question of access. It is the existenceof the letter that he is questioning.

MR. CHAIRMAN: Now, you go ahead.

So, we are investigating, and I have told you why we areinvestigating the matter. All I can say is that in January, 2004, the Governmentof the day, at least at the official level -- let me put it this way, at leastat the official level, in January, 2004, -- they did not take these allegationsas deserving of an immediate inquiry. That is all I would say. Today we have gota report, and therefore, we are investigating it.

Now, Sir, Mr. Jaitley says, facts are established. I say, with all humility,that facts have to be established.