gfiles Magazine November 2013

GOVERNANCE MG DEVASAHAYAM ON VK SINGH p20
YOGENDRA NARAIN ON RULES OF BUSINESS p26

November 5, 2013
VOL. 7, ISSUE 8

EXPOSÉ
LAND SHARKS
IN GURGAON
p16

NO ONE
DARE
ARREST
JIGNESH
SHAH!

FI RAT
RS H
T IKA
ST N
T
p3 IR BA
6 RI S
NG U
S

gfilesindia.com
di com
dia.com

From the Editor

T

vol. 7,

ISSUE 8 | November 2013

Anil Tyagi | editor
TR Ramachandran | executive editor
Niranjan Desai | roving editor
GS Sood | consulting business editor
Rakesh Bhardwaj | editorial consultant
Arvind Tiwari | director, business development
Naresh Minocha | associate editor
Neeraj Mahajan | associate editor
Alok Jain | coordinator (maharashtra)
Ajit Ujjainkar | bureau chief (mumbai)
Harishchandra Bhat | associate editor (bengaluru)
Venugopalan | bureau chief (bengaluru)
Kh Manglembi Devi | editorial coordinator
Mayank Awasthi | reporter
Pawan Kumar | production coordinator
Sumer Singh | assistant manager, logistics
Nipun Jain | finance
Gautam Das | legal consultant
Crossmedia Solutions | edit & design
Taran Tejpal Singh | Webmaster (Design)
Dipanshu Gupta | Webmaster (Programmer)
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disputes are subject to the exclusive jurisdiction of competent
courts in New Delhi only

HE general elections are just six months away and the
expected hullabaloo has already started. Realignment of
forces and individuals too is taking place. But, why is there
so much excitement over the election in 2014? Why is it appearing to be a ‘now
or never’ battle. Leaders from the old generation are apprehensive; thinking
if they fail to board the train this time, the game is over. The youth is guided
and motivated, but impatient. Is this battle between the old and the new the
reason for the heightened emotional quotient in this election? It may be one of
the reasons, but I think the real reason for inflamed passions in this election is
the growing size of the country’s economy. The size of the Indian economy as
per approximate figures is $2 trillion for the year 2013-2014; unofficially, as per
economic experts, it is 10 times more. So, India is among the richest countries
with the size of its economy being $20 trillion (unofficial), but with some of the
poorest inhabitants. Today, even the size of the scams has increased—now most
scams are to the tune of $6-10 billion. It is a classic case for management experts
to study and find out how a nation can grow amidst such all-round chaos.
If you analyse the authority, will, and political acumen of India’s Prime
Ministers in the last 23 years, you’ll realise that they had no significant mass
base. They were leaders in their own sphere and capacity, but they were not of
the stature to revolutionise the nation with their personalities. This suited the
designs of the powers, or ‘big brothers’ abroad. All the Prime Ministers in this
period, especially Manmohan Singh, perpetually kept the Government of India on
tenterhooks by implementing programmes and policies which favoured an open
economy. It is worth noting that the ‘big brothers’, wherever they have entered—
be it Panama, Ecuador, Argentina, Africa or Iraq—like to have a malleable leader
who will implement policies that promote and create a market platform where
they can sell their ideas and products to fill their coffers, while at the same time,
deny the rightful dues to the inhabitants of the respective nation.
Regional satraps have emerged again from their hiding places to beat the drum
that they are the only champions of the poor. Who knows, the next Prime Minister
may be one from among them. Both Congress Vice-President Rahul Gandhi and
BJP’s prime ministerial candidate Narendra Modi have strong views on national
issues. This may not be to the liking of the ‘big brothers’. In such a scenario, a
blunder that India has done is to forget developing a strict and regimented regulatory mechanism. Be it Japan, Singapore, Malaysia, or USA, there are no curbs on
doing business. But, once one commits a fraud with the system, he is effectively
penalised. In June, September and now November, gfiles has exposed the daylight robbery happening in the name of the farmer by the National Spot Exchange
Ltd. It appears that the whole financial governance system is in connivance with
the alleged scamster Jignesh Shah. He has allegedly manoeuvred the system so
well, that the Government of India can’t do a thing against him.
Shailaja Chandra tells the fascinating story of the almost forgotten bureaucrat
of yesteryears, Rathikant Basu, who dared to challenge the media industry and
was the man instrumental in establishing Star TV. MK Kaw calls for a well-thought
out policy on Kashmir, a region that needs care and special attention. The paradox is that too many cooks have spoilt the broth; every institution or leader working in the Valley has their own agenda and they are not bothered about either
Kashmir or India. How can we move forward in such a situation? But, we have to
move forward come what may, as Kashmir is India’s first love.
ANIL TYAGI

Download the gfiles app

www.indianbuzz.com

editor@gfilesindia.com

gfiles inside the government

vol. 7, issue 8 | November 2013

3

CONTENTS
6 Bric-a-Brac

LETTERS
editor@gfilesindia.com

10 Cover Story
jignesh shah roams scot-free

RE S
IN TA
LE TE
S SC
p4 S H AN
4
OO
DA

hot & cold
GOVERNANCE: JIGNESH SHAH, UNFIT
AND IMPROPER p12
October 5, 2013
VOL. 7, ISSUE 7

BIG BOSS
SANJAY KOTHARI
p18

16 Exposé
is hooda protecting land sharks?
gfilesindia.com

20 Governance
veekaysinghmania!

26 no longer business as usual
30 let’s not scuttle question hour
34 State Scan
kashmir: clamour for policy

36 First Stirrings

Battle
Battle
e
for

Bhopal
Bhopal
p

media mogul: rathikant basu

42 Mandarin Matters
bhutan comes of age

44 My Corner
relook at enquiry procedures

46 Book Review
coping with technology

48 Initiative
emotional intelligence

49 Stock Doctor
retail brokers under threat

56 Perspective
sadhguru on celebration

57 By the Way
on the edge & at a loss

Poll battle in MP
You presented a good analysis of the
political scenario in Madhya Pradesh
ahead of the assembly polls (gfiles,
Battle for Bhopal, October 2013). Both
the BJP and the Congress are pulling up
their socks and sparing no effort in their
campaigns to lure voters. Puneet
Nicholas Yadav mentioned in the article
that the BJP prime ministerial
candidate, Narendra Modi, will
somehow help Shivraj Singh Chauhan
in winning the election for the third
time in a row. I somehow disagree with
this point. BJP may well win again but
Modi will affect the hold of BJP in the
state in a negative way. The BJP’s move
to declare Modi as their prime
ministerial candidate will somehow
prove a boon for the Congress and help
it to attract minority votes. I agree,
however, that it will be an uphill task
for the Congress to reclaim MP. But
anyways, it will be interesting to see
common man Chief Minister Shivraj
Singh Chauhan battling against young
Jyotiraditya Scindia who comes from
the royal family of Gwalior.
M Singh via email

Kleptocratic India
MG Devasahayam’s article was very
nicely written (gfiles, October 2013).

4


The message is loud and clear; we are
being ruled by crooks (majority of
them). And our daily fights at each level
for our rights and for our country’s
good, is the only key which is going to
save us from this misery. “The darkest
places in the hell are reserved for those
who maintain their neutrality, even in
the times of moral crises.”—Dante
Alighieri.
Manish Mishra on blog
Although I agree with the thrust of the
article, the basic assumption that IAS is
one of the finest civil service structures
in the world is flawed. Consider the
following responses from senior IAS
officers from “one of the finest civil
service structures in the world”: (a) If
one brings to notice that an illegality is
taking place, the answer is, “Yes, I
know. I am helpless. Go to the court
and get me an order”, knowing fully
well that everyone involved will cop it
before a decision comes from the court.
(b) If one brings to the notice that the
written orders are being disobeyed
openly by citing contrary verbal orders,
the response is, “I have given my
written orders. There is no compulsion
to follow my verbal orders. Bring this to
the notice of the court”. (c) If footpaths
and roads are being used for
commercial purposes, the response is,
“Why do the citizens patronise such
establishments?”
Maj Gen S Jatar (Retd) on blog
We are really passing through a difficult
phase. The corruption is rampant and
the corrupt officers/employees/
businessmen are not shameful for their
misdeeds. There is no fear of
punishment. The time has come when
the silent majority of honest persons
including government servants should
condemn corruption and corrupt
people.
Jai K Verma on blog

www.gfilesindia.com

www.indianbuzz.co
www.indianbuzz.com
.com

es
th governm
the
rnment

vol. is u
vol. issue
vol
o
ol
ssu
ss
November
N
m

5

Bric-a-brac
hot & cold

Divine help?

mahant under seer’s spell

S

OBHAN Sarkar, the seer who had predicted that
1,000 tonnes of gold was buried under the temple in
Unnao, used senior Chhattisgarh Congress leader
Charan Das Mahant to put pressure on the government to
dig for the elusive gold. Mahant has been a long time chela
of Sarkar and was only too willing to oblige.

It now appears that Sarkar told Mahant that if he can
convince the government to dig for the gold, the Congressled central government would benefit from the discovery
and would get a financial windfall. Sarkar also said that a
highly pleased Congress party would then anoint Mahant
as the chief minister of Chhattisgarh, where elections are
to be held in November. At the moment, Mahant and Ajit
Jogi are locked in a tight battle for supremacy in the State.
If gold had been found, it may have indeed helped Mahant
to realise his dream of chief ministership. To keep Sarkar
happy, Mahant worked hard, meeting the Prime
Minister and the Home Minister a number of
times. It was reportedly only after a final nod from
Sonia Gandhi that the government agreed to send
the Geological Society for mapping the area and
using its sophisticated equipment to establish
whether there was any buried matter on the site.
Interestingly, the seer has also been impressed by
Rahul Gandhi to such an extent that he has told his
followers that Rahul has the soul of Jawaharlal Nehru and
would help the party win 400 seats. Sarkar is also of the
view that Rahul would revolutionise and cleanse the
current system of politics.

g

Rising star

cp joshi charms rahul gandhi

T

HE grapevine is abuzz with news that senior Rajasthan
leader CP Joshi is the rising star in the Rahul Gandhi camp.
Joshi, who was made the chairman of the screening committee for Chhattisgarh elections, is said to have been
instrumental in bringing Ajit Jogi on board and
engineering a rapprochement between Jogi
and Rahul. For a week before the announcement of tickets, Amit Jogi, the tech savvy
son of Ajit Jogi, was a daily visitor to
Rahul’s house. The two are said to
have had long discussions
on the selection of candidates, the topography
of Chhattisgarh and
the caste and regional
character of the State.
Joshi appears to have
bridged the divide, with
the result that Rahul agreed that
Amit and Renu Jogi should contest the

6


elections and Ajit Jogi agreed to step down in favour of his son.
Ajit Jogi will contest the Lok Sabha polls, unless he manages to
become the chief minister. In Rajasthan, much to the dismay of
Ashok Gehlot, Rahul Gandhi, in a luncheon meeting with senior
State leaders, wanted to know why Joshi was not being involved
in the selection of candidates. Rahul also asked
Joshi to give a list of his candidates.
It now looks as if the anti-Gehlot
group is back in business
and many among them are
likely to get tickets. While
Rahul is impressed by
Joshi’s head for numbers,
facts, figures and statistics,
could it also have to do with
the fact that Ahmed Patel
patronised Gehlot to the
exclusion of Joshi, and now
the wheel had turned full
circle?

g

www.gfilesindia.com

INSIDE EYE

ILLUSTRATIONS: ARUNA

Angry young man

bihar cong team faces rahul’s ire

R

AHUL Gandhi is frequently angry these days. The latest incident
happened when a delegation of the Bihar Congress went to meet
him. They favoured a tie-up with Laloo Prasad Yadav in Bihar.
They impressed upon Rahul the need to stitch together the alliance at the
earliest, so as to provide an alternative to the BJP in the State. But
what they got in return was a huge dressing down from Rahul, who
told them that they were not worried about either the party
or the workers, but only about their own interests and survival. He said that instead of talking about party programmes and how to strengthen the Congress in the
State, they were interested in samjhauta with another political party. The AICC vice-president, who is
known to be against alliances and advocates the theory
of ekla chalo, made it clear to the delegation that there
would be no alliance in Bihar. This has disappointed a number of
leaders, who know they cannot win without the support of Laloo Yadav.
But, as the word spread in Congress circles in Bihar,
party workers were reportedly happy at the stand
taken by Rahul.

g

www.indianbuzz.com



7

Bric-a-brac
hot & cold

Supreme power

hooda brooks no interference

H

ARYANA Chief Minister Bhupinder
Singh Hooda has grown so powerful that
he has dared to defy the Congress Party.
This was evident recently, when the Haryana
Government appointed three State Information
Commissioners. Sources disclosed that a powerful
Congress general secretary had desired that pro-Congress
persons be appointed as State Commissioners. He had also
recommended three names. But, Hooda instead appointed his
own nominees. It is learnt that the first appointment of Samir
Mathur, a 1981 batch IAS officer, who was working as additional
Chief Secretary, Home Department, on a three-month extension,
was done at the instance of Chattar Pal Singh, former PS to the Chief
Minister who recently became a UPSC Member on the recommendation
of Hooda. Second appointee, Hemant Atri came from the heartland of
Rohtak. Atri was working as Resident Editor of Bhaskar’s Rohtak edition. It
is learnt he managed the paper well and reportedly protected the interests of
Hooda till the time he worked there. The third appointee is veteran
journalist Yoginder Gupta, who retired from The Tribune and is
an old friend of the Chief Minister. Gupta used to help
Hooda when he was a small time Congress leader and
used to sit in Tribune office to keep Gupta in good
humour. Hooda has repaid his debt by appointing him to such a prestigious post. Apart from this, the Chief Minister has also
appointed another scribe, Pramod Vashista, as his Media Advisor. Vashista too was working with Bhaskar and reportedly
protecting the interest of the Congress and the Chief Minister. If any journalist knows Hooda and is looking for a job, he can
contact the Chief Minister as there still is a vacancy in the State Information Commissioner. In the election year, Hooda needs
the blessings of the media desperately.

g

8


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vol. issue 8 | November 2013

9

COVER STORY

scam nsel

Living

T

HERE is a saying in Gujarati that if your mother
is serving and even if you are way behind in the
queue – the least you can expect is an extra ladoo
(sweets) in your plate. This explains why both Jignesh
Shah and Ketan Parekh are managing to hoodwink the
law even after committing grave financial crimes. Unlike
Harshad Mehta, Hasan Ali and A R Telgi, Shah and Parekh
have managed to evade the law because of their political
connections.
“NSEL fraud makes the Harshad Mehta scam look like
child’s play. Mehta, at best, cheated a few banks, while
NSEL has eroded the confidence of the entire nation in
electronic commodity or stock exchange platforms,”
quipped a commodity broker.
Jignesh Shah managed to retain his position by convincing the MCX board to allow him to stay on for some
time? Till the last minute, it was expected that Shah
would step down owning moral responsibility for all
that has happened. But, till date, there is no sign of
Shah’s arrest or ban on the unlawful trading activities in
La Fin, FTIL, MCX, MCX-SX, NSEL and other companies
in his group. So far, only those who owe him money or

Despite the National Spot Exchange (NSEL) scam running into a whopping
Rs 5,600 crore, and its details out in the open, the authorities seem
reluctant to act. While arrests have been made in all major scams—from
Hawala to 2G to Coalgate—Jignesh Shah, the alleged kingpin behind the
multi-crore NSEL scam, continues to roam freely. After the gfiles story in
June 2013, NSEL operations were halted. But investigations began only after
the gfiles cover story in September 2013. Still, Jignesh Shah roams
scot-free. Sources disclose that Shah has engaged some of the best lawyers
in the country to pre-empt any government move to arrest him. Is the law
for scamsters or for exposing the truth? Neeraj Mahajan analyses the scam
and brings the latest updates on the developments taking place in the law
enforcement agencies and the Ministry of Consumer Affairs.

10


www.gfilesindia.com

Dangerously
P

those to whom he owes money seem to be feeling the heat
of the investigations. The only aberration to this rule has
been how Shah, Joseph Massey (MD MCX-SX) and
Shreekant Javalgekar (MD MCX) were forced to resign
from the board of MCX-SX a fortnight ago.
Frankly, would you call a person or company that has
been accused of being ‘dishonest’, involved in insider trading, making false claims, holding unproven deposits in client account, unaccounted brokerage income, unexplained
cash and jewellery, ’fit and proper’ to run commodity or
equity exchanges?
Looking at it purely from a management or governance
perspective, does the promoter, who appoints people to
run his company, have no responsibility towards the
stakeholders that he took the right decision by selecting
and monitoring the right people? Similarly, what would
you call a company whose Managing Director, Assistant
Vice-President, Business Development, and Assistant
Vice-President, Warehousing, are cooling their heels
behind bars for allegedly defrauding some 13,000
investors?

RELIMINARY investigations by the Income Tax
authorities seem to suggest severe lapses, mismanagement, cheating, criminal breach of trust, conspiracy and forgery at NSEL. It was not functioning as
a spot exchange as it was supposed to be. “If the NSEL
management and Board of Directors say that they failed to
see piles of bounced cheque and forged warehouse receipt
right on top of their table, they are either incompetent or
impractical,” says a broker.
A few other instances of misdemeanours of the
company are:
exchanges are not supposed to do so.
been found to be rigged.
safety with 100 per cent stock collateral, 10-20 per cent
margin money and post-dated cheques. These were
empty promises.
operate in nine States, including Maharashtra. The fact

GOVERNANCE

nsel jignesh shah

Unfit and im
Yet, ‘Operation

proper

Rescue Jignesh
Shah’ seems to
orchestrated by
his friends in high be in full force,
places

by NEERAJ MAHAJAN

W

ULTS:

25-28

05
30-33 02-

September

5, 2013

VOL. 7, ISSUE

by NEERAJ MAHAJAN

Haven for
gamblers

A

but in

no links with the

l

(India) L

gfiles inside the
governme
ent
vol. 7, issue 7
| October 201
13

13

at
Jg
Jignesh Shah

the launch of

.
MCX-SX in Mumbai

glo
global
keeping with
off trades in
prices trends
nt
n of
national preside
According to
aders
Tra
of All India
Confederation
e reaa, one of the
(CAIT) B C Bhartyi
racted
people get attr
is that there
ding
costs
nitial set-up
mputer
need is a com
online
onnection for
hysical
nlike in the ph
nt marneed 5 per cen
mmodrticipate in com
e able to
means you are
ing with
mes more tradi
ems easy
ey. All this see
st invescisely why mos
w
what
wh they
ney because
The NSEL is a sordid saga
g on what
of loot, treachery
has no bearing
and defiance of the governme
expertise
experience or
nt. Are we
waiting to solemnise this
gest comlarg
MCX is the
loot, or are we
e in India
allowing Jignesh Shah
ures exchang
to go scot-free for
hare while
sh
reportedly creating a mess
r cent market
in the financial
D
Derivatives
ommodity &
system? If this malaise
has
is not corrected, the
X) h a marLtd (NCDE
day is not far when the
nt and the
stock market matrix
of 25 per cen
may collapse — for, make
y
ity Exchange
Multi-Commod
no mistake,

not realise
What many do
e of
is that the volum in
g
modities tradin
commodities
f
r than that of
India is bigge
t.
the stock marke
related
Commodities
per
constitute 58
industries
GDP
cent of India’s

12

Public Interest Litigatio
ublic

T SSS J
T OG
p7 IRR
8
IN
G
RS
FI

10


vol. 7, issue 6 | September

ernment
gove
gfiles inside the 3 | June 2013
vol. 7, issue

13

n

THE HON’BLE SUPREME
COURT OF INDIA,
NEW DELHI
(Extraordinary Civil Writ
In the Matter of Citizens
Jurisdiction)
of India through gfiles:
A magazine on governanc
office at:
e with its corporate
(Registered with Registrar
of Newspapers for India,
vide Regn. No. DL Eng/2007/1
9719)
118, IInd Floor, DDA Site
— 1,
New Rajinder Nagar,
New Delhi — 110 060
……Petitioner
VERSUS
1. Jignesh Shah, Founder
Chairman and Group
CEO, Financial Technologie
2. Prof KV Thomas,
s & MCX Group
Union Ministry of Consumer
X
Affairs, Food & Public
3. Pankaj Agrawala,
Distribution
IAS, Secretary, Consumer
Affairs
4. Ramesh Abhishek,
IAS, Chairman, Forward
Markets Commission
5. UK Sinha, Chairman,
(FMC), Mumbai
Securities and Exchange
Board of India (SEBI)
6. Chairman, Warehousin
g Development and Regulatory
7. Chairman, Nafed
Authority (WDRA) ……
Defendants
8. Governor, RBI

S

AH
AH
JIG ES H
JIGNE
JIGNESH SHA

www.indianbuzz.com

an MCX SX
h irman of MCX-SX
and Vice-Chai

T

OT
OT
AT NAL SPO
ATIONA SP D AM
NATIONAL LTD SCAM
XCHA G LT
EXCHANGE

GREAT R
GAMBLE

P Chidambaram

lot
sources, a whole
According to
business
ations and murky

It’s an amazing story of
a small-time trader,
Jignesh Shah, who manipula
ted
while fooling almost everyone the NSEL
in the system.
The NSEL is a classic case
of the failure of
governance in India—of
a non-existent
regulator and conniving
bureaucra
politicians, and every technique ts and
worth the
name being used to deceive
and trap greedy
investors to make billions
overnight.
there
are many Jignesh Shahs
Who is behind Jignesh
watching, ready to
Shah, sharing the
exploit the governance
booty of the loot—a veteran
system that appears
Maratha
to be helpless, toothless
politician, or the entire
and defunct.
financial governance
Anil Tyagi and Neeraj Mahajan
system, or greedy business
take you into
houses? How
the treacherous world of
can a governance system
the NSEL and
be so toothless
explain how the governan
that not even a single FIR
ce system can be
is registered
taken for a ride by anybody
against the alleged fraudsters
with the right
? What is the
kind of network. In the
government waiting for?
coming months, this
Where has the
will have a cascading effect
money gone? Who will
on the already
account for it?
struggling financial market.

lic interest
A gfiles pub
n
the attentio
initiative for
e Court
of the Suprem

THE

UNI

Finance Minister

Loot in name of th
Lo
e farmer!

This story is about possibly
y about
the biggest scandal
of the decade spawned
cade
cade spawned by the combinat
d
ion of a
greedy businessman, a
usinessman, lackadais
n
lack
ical regulator,
ever-willing investors looki
ing in
investors looking to become
millionaires overnight,
res overnight, shrewd politicians
shre
and
cunning but easily pliable
easily
b
bureaucrats. The story
is about the unregulated
e unregulated an reportedly
and
illegal
National Spot Exchange
Spot E
ot
o
Lim
Limited (NSEL). A story
of billions of rupees changin
ns rupees changing
u
hands in the name
of the farmer but there
rmer but
e
being no produce or
storage in the market,
the
e
yet the commodity—
th
which cannot be legally
annot b
ot
o
traded—being traded.
trad

m
nd
es ndi com
lesind a.com
gfilesindia

12

exchanges

0 farmers have
BOUT 2,50,00
in India
committed suicide
f
one-and-a hal
in the last
Crime
the National
decades, says
s to 45
. This amount
Records Bureau
is the
every day. Why
farmer suicides
drasresorting to such
Indian farmer
farmer so
Why is the Indian
tic steps?
uras prices of agricult
desperate even
Why
continue to rise?
al commodities
cutthis happen despite
are we seeing
and
h in agriculture
ivting edge researc
ed land product
pesticides, improv
s
harvests?
ity and better
the
odity derivative
not getting
is
d the comm
If the farmer
is
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The purpose behin lity, poverty reduction and
y
where is it
po
money, w
ling the
stabi
sed economy, manipulating and controllling It
ket
market was price
dities?
ent in a market-ba a money
agro commo
lopm
prices of
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that should
economic deve
et has become
that the profits
farmers appears
reality the mark
one to the farm-

Com
Commodity

COVER STORY making factory that has
STORY
TO

exposé

6

YAM
MG DEVASAHA
HOPE FROM
DURGA
p82

The office of Financia
l Technologies
gi

r
markets agric
markets

T

Newton’s law
of gravity –What
goes cials reporte
up must come
ITH the Rs
down – does
dly spoke to Shah
5,600-crore
not apply. finalisin
Whatever the
before
NSEL scam out
g the Mayara
official stand,
in the open,
privately, which,
m
everyone in the
the issue now
many say, is eye-was Report,
government,
is whether
Shah should be
regulah.
tors and the
Wasn’t
given a ‘fit and
investors do
proper’ Shah
not want commit the KC Chakrabarty subcertificate to run
to be harmed
the spot exchang
tee, headed by
. The investor
e. If point of
he does not
the RBI deps’ uty governo
get this certifica
view is that, if
r, instituted to
anything hapte, not pens
only will Jignesh
assess the
to him, they might
systemic impact
be unable to
p
g never recover
e
of the NSEL
run thei money.
NSEL, he will
their
crisis
c i i
and pinpoint
d
be debarred from
“Good or bad,
the violation
run- an approac
Jignesh is Strange
ning the MCX
of laws?
an MCX-SX
nd
hable face of
ly, the sub-com
too. But If
FTIL group.
it seems that
mittee did
anything happen
not find broader
effor are on
rts
s to him, BSE,
to camou- NSE
systemic
flage the scam
and the brokers
tion. That t
and confuse the
d
will be affected
issue Sharad
to such an extent
Saraf, the co
that he gets the
th
cer- Inve
tificate. This
will m
mean a vict
him, despite
the u
un
scam that has
rocke t
ed
Clearly, if you
are Sh
e

SURVEY RES
DELHI POLL

VE
V
OV
COVE STORY
COVER S
culture

distance himself
and claim to be
una- Preside
ware of the goingsnt (Business
on inside NSEL.
Development)
But NSEL co-foun
Reliance Industr
at
It has been
der, MD and
ies Ltd.
reliably learnt
CEO
Anjani Sinha,
that,
some time ago,
who signed an
Reliance Capital
affidavit
accepting blame
had
HE possibility
tried to take
for whatever
over MCX but
of an Ambani
happened at the
someconnection behind
how the deal
spot exchang
could not go
e, raised
more doubts
through.
bail-out plan cannot the Shah Even now, if
than he laid
the corporate
to rest. as,
be ruled out
The fact that
entities
besides Patel,
are ready, the
Sinha filed his
Anil Chandanmal
government
affidavit Singhvi
f
before the Econom
may go
to any extent
, the founder of
nomic Offence
ic
to facilitate
proxy advisor
s Wing firm
(EOW) is no
Reliance
ry
IIAS,
IIAS, who is playing
less intriguing—con
a key
fessions before
- role in the
e police officers
crisis, is an old
have Ambani
no legal sanct
tity. Besides
loyalist. Singhvi
, Sinha, was
who presided
Vice-Chairman
ov the shut-do
over
and
wn of Directo
the Magadh,
r
Ah
Ahmedabad
and Safal Natural of Reliance
exchanges was
fal
es,
Resources Ltd
R
picked up by
i k
Shah to of the
head the NSEL.
Anil Dhirubh
Still, if S
ai
ms to Ambani
be in th
Group,
rove before
moving to
able Ambuja
Cements.
and
ly,
a),
d
-

2013
www.gfilesindia.com
w gfilesindia
gfilesindia.

www.indianbuzz.com

vol. 7, issue 6 | September

2013

11



11

COVER STORY

scam nsel

is that Maharashtra Agriculture Department cancelled
NSEL’s direct marketing license on December 26, 2012.
· What else do you call a company that announced a payout plan on August 14, but was unable to stick to schedule even once and defaulted on payment schedule ten
times in a row. That’s when NSEL holds over 90 per
cent market share of National Bulk Handling Corp Ltd,
which runs the nation’s largest warehousing facilities.
paired contracts. They were just paying the difference in
prices between the spot and futures contract for the
same commodity.
mandatory margin money was not being collected from
all those using the MCX and NSEL platforms. Apart
from this, positions of some of the investors were being
revealed to others, giving them an unfair business
advantage. This has been corroborated by the fact that
Anjani Sinha’s wife, Shalini Sinha’s company, SNP
Designs, was allowed to trade worth Rs 40,000 crore on
MCX without paying any margin. The heavy losses were
written off. Apparently, SNP also had business relations
with Mohan India, one of NSEL’s largest debtors.

S

O far as the High Networth Individual (HNI) investors are concerned, the moot question is: are they
as sinned against as they claim? Why did they take
advantage of the corrupt system till the going was good,
and are complaining now when they lost money?
“They were using NSEL as a private club. HNI investors
all along knew what they were getting into when they started trading in these unregulated exchanges. If the exchange
was functioning without the oversight of an independent
board of directors, the brokers were party to it. Why are
they complaining now?” asks Shriram Subramanian, MD,
InGovern, a corporate governance research firm.
Another big question is what happens to the money.
The NSEL Investor’s Forum officials say that they are
working with the Economic Offences Wing (EOW) and
others to recover the money. They are sadly mistaken if
they think that the EOW and the Income Tax authority’s
job is to recover money at their behest and hand it to them.
First, in a white collar crime, money recovered becomes

the case property which needs to be produced as evidence.
It cannot be handed over, even to the rightful owner, till
the case is finally disposed off or the court orders to do so.
Second, criminal investigation wing of the Mumbai Income
Tax department is asking investors to produce evidence
about the source of their funds and whether they paid tax
on the income from commodity trading. Some of the other
details being sought are about brokerage and commissions’ transactions for investments in the spot exchange.
This is proving to be a booby trap, as failure to provide the
details sought can lead to fine of up to Rs 10,000 under
Section 272 (1) (c) of the I-T Act.
“Law enforcement agencies are not recovery agents to
recover money from defaulters of defaulters. Tomorrow, if
Dawood gives you a list of people who owe money to him,
you may not allow him to go free till the last of his borrow-

So far as the High Networth Individual (HNI) investors are concerned, the moot
question is: are they as sinned against as they claim? Why did they take advantage
of the corrupt system till the going was good, and are complaining now when they
lost money?

12


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TURNING A BLIND EYE: The members of the Advisory Board of
the Financial Technologies (India) Limited

ers has paid him his due. Jignesh Shah too should not be
allowed to go free. You are setting a wrong precedent,” said
a senior Delhi Police officer.
Significantly, this is not the first time FTIL promoters or
employees have been accused of serious penal offenses.
Immediately after MCX became the first exchange in India
to initiate evening sessions to coincide trading with Tokyo,
Shanghai, London, New York exchanges, the Central
Board of Excise and Customs (CBEC) issued a notice
is still pending. This apart, as many as three criminal cases
are pending against Joseph Massey and one against C
Subramaniam, one of the longest serving Non-Executive
Director and shareholder of FTIL, who initially promoted
a company called Worldwide Technologies. The company’s latter avatar is today called Financial Technologies.
Anil Lal Chetta filed a criminal case (No. 1909/02)
against Subhash Dalal (Director) and Joseph Massey
(Executive Director), Vadodara Stock Exchange, for
illegally declaring him “defaulter” and auctioning his
membership. The case is pending before the Chief Judicial
Magistrate in Vadodara.

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In another case, the Government Labour Officer,
Vadodara, filed a criminal case (No. 1831/97) against
Joseph Massey and Vadodara Stock Exchange for noncompliance of Minimum Wages Act and non-filing of
annual returns. This case is also pending before the
Judicial Magistrate, First Class, Vadodara.
Similarly, Harish Chand Jain filed a criminal case (No.
1288/2003), alleging that Joseph Massey, the then
Managing Director of the Inter-connected Stock Exchange
of India, and other officials were refusing to refund the
admission fees and connectivity charges paid by him at the
time of membership. This case is pending before the Chief
Judicial Magistrate, Agra.
In yet another instance, the CBI reportedly filed a criminal case against C Subramaniam (No. 16/2001) under the
negotiable Instruments Act, 1871, for attempting to
defraud Central Bank of India, Janpath branch. The case
is being considered by the CBI Special Court, Tis Hazari,
New Delhi.
Apparently, one of the reasons why Shah has not been
touched so far is reportedly because of an understanding
between the Congress at the Centre and Sharad Pawar’s
Nationalist Congress Party (NCP) in Maharashtra.
“Someone close to Pawar is believed to have invested lot
of money in Jignesh Shah’s company, which he suddenly
withdrew and this may be the reason why MCX’s settlement
guarantee fund suddenly shrunk in size,” sources said.

A

NOTHER twist in the tale is how former MD and CEO
of NSEL Anjani Sinha denied the August 14 affidavit and claimed to have “filed it under duress.” Sinha
is now saying that he was made to sign the old affidavit by
the NSEL board, in the office of the exchange.
This seems to coincide with the version of former NSEL
Assistant Vice-President, Business Development, Amit
Mukherjee’s claim that he and others were made scapegoats to save Shah and other “influential people” who were
involved. Both Mukherjee and Jai Bahukhandi are in
police custody and have agreed to become prosecution
witnesses.
Meanwhile, the EOW arrested Nilesh Patel, the son-inlaw of Shankarlal Guru, who resigned as the chairman of
NSEL. Patel is the managing director of NK Proteins
Limited, the biggest of the 24 borrowers of National Spot
Exchange Ltd (NSEL). Patel’s company allegedly raised
funds from NSEL on the pretext of a castor seed contract,



13

COVER STORY

scam nsel

Curiously, SEBI chief general manager D Ravikumar,
without depositing any collateral in the warehouses. This
money was allegedly siphoned off to fund a joint venture while overruling Sahoo’s concerns, wrote, “initiation of an
for export of castor oil with a Gujarat-based industrial enquiry may not by itself disqualify the concerned entity
house. NK Proteins, which owes around Rs 930 crore to from being considered as fit and proper, especially when
NSEL, apparently had no intensions of returning the the outcome of such an enquiry is not known”.
According to reliable sources, the 2007 income tax raid
money, sources said.
Meanwhile, enquiries by the Forward Markets itself was stage-managed. The main purpose of the raid
Commission (FMC) have revealed over 2,000 instances of was not to recover money and assets, but to trouble Shah
mismanagement in the exchange over the past few years. enough to make him arrive at an unofficial settlement. One
This is bad news for Shah, whose name figures among the of the officers behind the raid is an informal ‘economic
key management personnel of the spot exchange between trouble-shooter’ for Shah while another is holding an
FY06 and FY12 and was only dropped in 2012-13. He was important post in SEBI today, sources said.
Though the raid was targeted on FTIL, MCX and Shah,
the key management personnel in 2009 when the decision
was taken to go ahead with “paired contracts”—against no undisclosed income was claimed to be recovered from
the rules for spot exchanges was taken. Interestingly, them. Only Rs 1 crore was claimed to be seized from FTIL
this list kept shrinking every year and Anjani Sinha and Rs 1.15 crore from C Subramanium, in addition to Rs
was the only person in the list in 2012-13. It is reliably 17 lakh from AM Futures and Rs 38 lakh from RJ
learnt that in 2007 some highly placed IRS officers Commodities.
On its part, FTIL was charged with
observed instances of bungling in the
withdrawing a bogus claim of Rs 18
Jignesh Shah empire. Based on their
Based on a tip-off,
crore in depreciation, while Reymount
tip-off, an Income Tax ’search and
an Income Tax ’search
Commodities, owned by a Dubaiseizure’ operation was conducted on
and seizure’ operation
based NRI businessman, was accused
Shah, FTIL, MCX, their other directors
and brokers on June 19, 2007.
was conducted on Shah, of accepting unproven cash deposits of
Rs 15 crore from 856 people across the
FTIL, MCX, their other
country
whose
“identity
and
OLLOWING the raid, MS Sahoo,
directors and brokers on creditworthiness” could not be proved.
the then Director (Securities) in
June 19, 2007
Interestingly, one of the entities
the Finance Ministry, wrote a
under the income tax scanner in 2007
confidential DO to MS Roy, ED of
SEBI, enclosing documents received from the Central was also found to be involved in the Kochi IPL
Board of Direct Taxes. “Though the above documents do fiasco. But Reymount Commodities, having its registered
not provide final findings, these provide adequate basis to office in Chennai and another office opposite the Police
conclude prima facie that Financial Technologies, MCX Commissioner’s Office in Pune, deserves a special mention.
and Jignesh Shah are not fit and proper to acquire shares Though the company, promoted by Muhammed Abdul
in stock exchanges.” He was referring to a bid by Shah to Kareem Faisal PV, PV Shamusudeen and K Satya Prasad,
acquire 5 per cent stake in the Delhi and Vadodara stock was suspended on July 7, 2007, “for various violations/
irregularities”, its website still claims to be “a prime
exchanges.
“Sebi is advised to defer any proposal to acquire shares member in MCX India”. According to sources in the
in stock exchanges by these entities, until CBDT issues a Intelligence Bureau, the company is allegedly involved in
show cause notice to them or clears them of any tax helping banned Islamic terrorist outfits like SIMI and
Indian Mujahideen to regroup and form a combined base
liability,” he advised further.
Strangely, one of the annexures in Sahoo’s note was a in Kerala. With such dubious friends and associates, Shah
letter dated from SSN Moorthy, Director-General Income can be anything but fit and proper.
But the issue is, who will pierce the corporate veil.
Tax (Investigation), addressed to the Member Investigation, Central Board of Direct Taxes, giving details of Technically, though FTIL holds almost 100 per cent in
the amount or assets seized from FTIL, C Subramanium NSEL, both are different companies and the
(Director, FTIL), Reymount Commodities (commodity promoters of NSEL and FTIL are common. But, since the
broker), AM Futures (commodity broker) and RJ promoters are common, they should at least be held
accountable for their lapses. g
Commodities (commodity broker).

F

14


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www.indianbuzz.com



15

EXPOSÉ

land deals haryana

Where land
sharks rule
The nexus between politicians and builders in Gurgaon is responsible for
largescale loot of public resources in the millennium city
by NARENDRA KAUSHIK

A

MIT Jain, Director-General
of Federation of Apartment
Owners Association (FAOA),
frequently draws a parallel between
Gurgaon, the millennium city abutting South Delhi, and Mandwa, a
hamlet near Mumbai made famous
by Hindi film titled Agneepath. While
in Mandwa, Jain points out, criminals multiplied their income through
smuggling of narcotics, in Gurgaon,
builders and developers do it through
shady property deals.
Jain would know. The FAOA, a
group of 35 apartment owners associations from different parts of the
country fighting against builders for
upholding interests of apartment
residents, gets 24 of its enrolments
from Gurgaon alone. The Federation

16


has taken over some 20 cases from
apartment associations against the
builders. Out of these, half a dozen are
against DLF Ltd, arguably the largest
commercial estate company in the
country. In a case pertaining to Silver
Oak, the first apartment developed by
DLF, the FAOA is awaiting an order
from the Supreme Court. Jain accuses
the Haryana Government of partnering with DLF and other builders to rip
off every ounce of public resources
in Gurgaon. “It’s not collision. It’s a
partnership. The system is run by
politicians and builders together,”
Jain alleges.
Surprisingly,
despite
having
a booming market where prices
have multiplied several times in
the last decade or so, the Haryana
Government, according to Jain, has
kept the circle rate ridiculously low

and allowed people to park their black
money in the city.
Jain’s accusation finds an echo
in statement of Raman Sharma,
President of the Progressive Gurgaon
Forum (PGF), an umbrella body
of around 68 Resident Welfare
Associations (RWAs). “The Town
and Country Planning Department
(TC&P) is there to benefit the builders,” he says. The Forum has filed
close to 200 complaints against the
builders and the department in the
last four years. The department is
spearheaded by a Director-General
and represented by a Senior Town
Planner in Gurgaon. Sharma also
has five complaints pending before
the Lokayukta, the anti-corruption
ombudsman in Haryana.
Sharma has accused the builder of
encroaching his residential society,

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Malibu Towne in Sector 47, on open
space (common area). “The builder
has constructed a telephone exchange
and raised electric infrastructure and
other things on 15 acres. The market
value of this land is around Rs 375
crore (Rs 25 per acre),” he claims.
The Malibu Towne builder has not
handed over the common area to
HUDA (Haryana Urban Development
Authority) even nine years after the
launch of the residential society,
though the Haryana Development
and Regulation of Urban Areas Act,
1975, stipulates that the builder
should transfer the project to HUDA
within seven years after the launch.
In fact, the most shocking part is
that none of the over 920 licensees,
who have been granted licenses by
the TC&P Department till October 11,
2013, in Gurgaon, have transferred
their projects to HUDA for maintenance. HUDA, headed by a Chief
Administrator in Chandigarh and an
Administrator in Gurgaon, has also

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done nothing to take over these projects. Sharma charges Gurgaon builders with not doing enough to provide
proper roads, treated water, sewerage, solar water heating and community centre, etc., to their residents.
Sharma puts the quantum of scam
on account of construction in common
area and its non-transfer to the local
agency by the builders at Rs 1,80,000
crore. But, the total property scam
could run into much more—according
to experts in Gurgaon’s estate market, it could be anything between Rs
4,00,000 crore to Rs 5,00,000 crore
in the last nine years alone, if one
were add up CLU (Change of Land
Use) certificates the government
grants to the builders and developers
to the non-transfer of common area
to the HUDA. Haryana’s Bhupinder
Singh Hooda Government allegedly
collects Rs 2 crore underhand for
CLU for every acre of land. The CLU
apparently allows influential people
like Sonia Gandhi’s son-in-law Robert
Vadra to become ultra-rich overnight.
Congress MP and Hooda’s bête
noire Rao Inderjit Singh has demanded a probe into licensing of 21,000
acres of land by the State Government
in first eight years of its tenure.
Hooda, in turn, has pointed out that
his government even granted license
to a collaboration between Inderjit

Despite having a booming
market where prices have
multiplied several times in
last decade or so, the
Haryana Government, it is
alleged, has kept the
circle rate ridiculously
low and allowed people
to park their black money
in the city

and Unitech for development of a
colony on 83 acres of land, under the
‘small farmer’ norm.

T

HERE are strong indicators
of the Haryana Government’s
complicity with the builders in
Gurgaon. For one, the Government
has till date never punished a builder
for violations of the 1975 Act. It has
never moved beyond cancellation of
license and invoked Section 10 of the
Act, which prescribes maximum of
three-year jail and fine to an offender.
It also has not invoked Section 11B of
the Act, which empowers the police
to arrest such an offender. On the
contrary, the cancellation of license
is invariably revoked after some time,
allowing the builder to go scot-free
and resell his plots/flats at a much
higher rate.
A befitting example of the government’s soft and one-step-forwardtwo-step-backward
approach
is
Mayfield Garden, a 327-acre township developed by five builders near a
star hotel in Gurgaon. On February 4,
2012, DG TC&P T C Gupta cancelled
all 26 licenses of the five builders and
put an embargo on further sale of
plots after his Senior Town Planner
confirmed that some of the roads were
in ‘worst condition’ and the builders were yet to construct community
building. In addition, the builders
had raised a commercial market in a
place earmarked for a dispensary in
the approved layout plan. The cancellation was revoked on September
5, 2012, after the developers gave it
in writing that they would lay water
lines, carpet the roads and provide
sewerage and parks.
The internal development was to be
done within six months (before March
5, 2013). But none of this has happened. In the meantime, the Haryana
Lokayukta has issued notice to Gupta,



17

EXPOSÉ

land deals haryana

FIGHTING THE BUILDERS’ MAFIA: Raman Sharma, Dharambir Yadav and Amit Jain

on a complaint filed by Sheetal
Residents Welfare Association, alleging Gupta’s complicity with the developers. Dharambir Yadav, President,
Sheetal Residents Association, has
alleged that Gupta “knowingly and
intentionally favoured the licensee
companies for not prosecuting the
developers for cognizable offences,
committed by them in construction of
illegal independent floors by dividing
the plots vertically, in contravention
of prescribed rules and has failed to
recover the public money on account
of regularisation fee of illegal independent floors”. Gupta has denied the
allegation and claimed to have initiated action against the colonisers.
Jain
cites
Kunskapsskolan
Eduventures Limited, a school offering K12 education based on KED programme for Indian and International
students, as another example of
builder-government complicity in
Gurgaon. The school began its first
session earlier this year. DLF gifted
five acres of land, earmarked for 80
plots and a park, to the school in April
2009, much to the dismay of resident
welfare associations.

18


J

AIN raises questions on the functioning of the judiciary on the
basis of cases pending against
builders in the Supreme Court, and
what the Punjab & Haryana High
Court did in January this year on the
petition of residents of DLF Phase I
against the Kunskapsskolan School.
The High Court allowed the petitioners to withdraw their plea, though the
latter claim to have never asked for it!
Since 1981, when the TC&P gave
the first license to DLF to develop a
high-rise apartment building, less
than half-a-dozen licenses, out of
over 924 licenses approved, have
been cancelled in Gurgaon. But not

Some observers put the
quantum of scam on
account of construction in
common area and its nontransfer to the local agency
by the builders at Rs
1,80,000 crore. But, the
total property scam could
run into much more

a single builder or developer has
had to face prosecution or arrest as
stipulated in Section 10 and Section
11 B of the Haryana Development
and Regulation of Urban Areas Act,
1975. “Why does the department not
invoke Section 10?” asks an intrigued
Dharambir Yadav.
On September 13, 2013, DG,
TC&P, Haryana, withdrew approval
of demarcation-cum-zoning plans of
the licensee, Countrywide Promoters
Private Limited, for developing a residential colony over 108.069 acres in
Sector 102 and Sector 102-A, after it
observed that the licensee had not
cleared EDC (External Development
Charges), amounting to over Rs 73
crore. The department directed the
licensee to stop all development work
at the site. But a visit by gfiles saw the
development work still going on.
Another evidence of governmentbuilder nexus in Gurgaon was a memo
issued by the TC&P on September 15,
2008. “The license application of only
those registered cooperative house
building societies will be considered
for grant of license, who have a collaboration with the builders/devel-

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opers having the financial capacity
to undertake the development and
technical expertise in development
of residential colonies,” the memo
reads. It was clearly aimed at forcing
cooperative societies to enrol builders
into their projects. The move considerably increased the societies’ budget,
defeating the very purpose of floating
a cooperative society.

T

HE number of licenses granted
has been highest in 2008 (150
out of 210 given for different
projects in Gurgaon) till date. Is it a
mere coincidence that this was a few
months before the State went to polls?
It is apparent that Hooda has used
select bureaucrats to dole out land
largesse to builders in Gurgaon and
silence voices of dissent like that of
Ashok Khemka, whistleblower IAS,
who exposed Vadra’s land deal earlier this year. Is it just a coincidence
that Sudeep Singh Dhillon, currently Principal Secretary to Haryana
Chief Minister and former Principal
Secretary, TC&P, and TC Gupta, currently Principal Secretary in Food
& Supplies Department and former
head of TC&P, have been in the forefront of taking on Khemka on behalf
of the State Government? Gupta was
held guilty of contempt of court last
year by the Punjab & Haryana High
Court for giving licenses to builders in
contravention of a HC order.
There are also allegations that
Gupta has been involved in amassing
property. In fact, there are many officers in the HUDA and the TC&P who
face charges of graft. These include
several Haryana Civil Service officers
and engineers. Both the departments
report to the Financial Commissioner
and the Principal Secretary. While
the TC&P is responsible for issuing
licenses and mutation of land for
development of residential colonies,

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T

Justice delayed is justice denied

HE pendency of hearing in the
Supreme Court is what keeps
Brigadier (retired) Madanjit
Singh, a septuagenarian living in
Naraina, and Neelam Tejpal, a widow
residing in Janakpuri, on tenterhooks. Singh and Tejpal booked flats
in Regency Park II in 1993. The flats
were to be handed over three years
later. But in 1998, DLF asked the duo
and other bookers to pay over 50 per
cent more on the paid amount (over
Rs 4 lakh). The builder attributed the
demand to increase in material cost.
Forty buyers challenged the demand
under Monopolistic and Restrictive
Trade Practices (MRTP).
In 2006, the MRTP decided the
case in favour of the petitioners. But
the developers, instead of giving the
flats to them, challenged the order in
the Supreme Court. Singh (78) says
the apex court is yet to hear the case.
In the last seven years, three petitioners, according to Jain, have
passed away and 34 others have settled the matter with the developer.
Many of the petitioners even sold off
their flats. Singh, Tejpal and a third
unnamed person are only ones pursuing the case now. “Now the developer is asking for over Rs 25 lakh.

institutions, commercial structures
and recreational avenues, etc., HUDA
is supposed to provide infrastructure.
HUDA Administrator in Gurgaon,
Praveen Kumar, has himself been
under a cloud since Khemka alleged
in a report that the former’s mother
Krishna Kanta, who hails from
Hooda’s native village Sanghi, got
a prime piece of usurped land in
Faridabad when her son was Deputy
Commissioner in Faridabad. Kumar

Every year, one or two of us have
quit. Tamasha bana ke rakh diya hai.
I made a mistake. I could have raised
Rs 20 lakh in rent alone,” Singh
regrets.
Apart from Regency Park II, a few
other cases are also pending against
DLF and others in the Supreme Court.
These include the Silokhera case
where DLF has challenged an order of
the Punjab & Haryana High Court
cancelling acquisition of land by
Haryana Government in Silokhera
Village. The agricultural land—
around 170 acres—was acquired for
public purpose by the government
and then released to East India
Hotels Limited for construction of a
300-bed hospital. The East India
Hotels sold off the land to DLF and
the latter secured the government’s
permission to set up a Special
Economic Zone (SEZ) there. The twojudge High Court bench noted in its
order that the process “clearly shows
the nexus between the respondent
companies (East India Hotels Limited
and DLF) and the government to
defraud the public at large”. The case
was challenged in the Supreme Court
and is yet to be heard.
Another case awaiting hearing in
the highest court is about a cyber city
building, developed on panchayat
land belonging to Nathupur village.

refutes the allegation. But his zeal
to demolish illegal structures and
improve infrastructure in Gurgaon
has definitely proved to be a false
starter. One example is that a part of
the land freed from encroachments by
him in DLF Phase V is being looked
after by a top developer now. Estate
experts believe that it is just a matter
of time before the developer gets
a license to build an apartment or
commercial structure there. g



19

GOVERNANCE

witch hunting mg devasahayam

‘Veekaysinghmania’

SATYAMEVA
JAYATE

?

The saga of incidents and events related to former
ated former
Army Chief VK Singh leaves one disillusioned
llusioned
with the possibility that truth shall prevail

T

HE distinguished civilian MK
Kaw wrote thus: “Modi’s illadvised selection of strange
bedfellows can result in the kind of
fiasco that has followed sharing of the
dais with maverick personalities like
General VK Singh, former Chief of
Army staff, who has been embroiled
in controversies galore.….” (gfiles,
October 2013). Indeed, the avalanche
of lies about the General, flooding the
media for over two years, is having
their effect!
There is this notorious Goebbels
doctrine: “If you tell a lie big enough
and keep repeating it, people will
eventually come to believe it. The
lie can be maintained only for such
time as the State can shield the people from the political, economic and/
or military consequences of the lie. It
thus becomes vitally important for the
State to use all of its powers to repress
dissent, for the truth is the mortal
enemy of the lie, and thus by extension, the truth is the greatest enemy

20



of the State.” India’s ruling
coterie and the ‘committed’
e
media appear to be loyal
r
adherents of this doctrine!
his
While so, General VK
Singh was the first comhe
mando to become India’s
ecome
Army Chief and the best, havnd
ing topped the Ranger Combat
he
Leadership Course of the US
ered
Army, considered the ‘toughest
in the world’! ‘Commandos’ are
!
defined as ‘a small fighting force
specially trained for making quick
ned
destructive raids against enemy-held
ids
areas.’ All-pervading corruption and
rvading
resource-loot being India’s worst
enemies, VK Singh started his fourstar career by daring them. Within
y
weeks, he took on the then Union
k
Home Minister and declined to
er
let loose the army in the jungles of central/east India. Had
l/east
he not done so, by now most
of the tribals would have been
annihilated and one-fourth

www filesind a.com
www.gfilesindia.com
www.gfilesindia.com
ww le in
n
om
m

of India’s forest wealth lost to the
mining industry! His exposure of
kickbacks in defence procurements
stopped carpetbaggers in their track.
Post-retirement, he also took on the
mighty nuclear cartel.
In retaliation, he faced the combined might of the politicians, executive and media bearing on him. What
powers lay behind this might, other
than arms merchants and resourcelooters? Goebelesian canard and
condemnation followed.
There is a saying: “Lie is halfway
round the world before truth has got
its boots on.’ Eventually, ‘when truth
Ev
gets booted and spurred, the lie gets a
s
good licking’. Glimmer of some hope!
Gli
It a started with Vijay Kumar
t all sta ted
Singh’s date of birth (DoB) issue. He
b
was born son of an army officer in
an Army Hospital in Pune, and the
Hospit
birth record says May 10, 1951. Just
say
a boy of 14, while awaiting results of
whil
his matriculation exam, he applied
to the UPSC for admission to
f
National Defence Academy. The
Defenc
application had an inadvertent
error, mentioning his DoB
mentionin
as May 10, 1950.
19

www.indianbuzz.com
www in ianbuz
www.indianbuzz.com
w. nd
u

The twin ‘Swords of
Damocles’ hanging over the
head of the Army Chief
have severely compromised
the command structure,
institutional integrity
and functional efficacy
of the Army
Matriculation certificate, which he
received later, records the DoB as May
10, 1951. The matter stood resolved
in Indian Military Academy itself
when the freshly commissioned 2nd
Lt VK Singh was issued with an identity card bearing the correct DoB i.e.
May 10, 1951. Issue was finally settled

when the MS Branch used the same
DoB during various Selection Boards
for promotion of VK Singh to higher
ranks of Brigadier (Sept 1996), Major
General (Oct 2001 and Sept 2003)
and Lt. General (Sept 2005).
The controversy commenced with
the curious ‘look-down policy’ initiated by the then Army Chief in 2006
to determine the ‘line of succession’
and to install a favourite as COAS in
May 2012. For this purpose, the UPSC
application form, mistakenly mentioning 1950 as his year of birth, was
dug out and used as the ‘brahmastra’ to truncate General VK Singh’s
tenure. Using blackmail tactics, VK
Singh was called on the eve of his
promotion as Lt. Gen and ordered to
accept May 10, 1950, as his DoB! All
these manoeuvrings and manipulations came to haunt the General after
he assumed charge as Chief of the
Army Staff!

T

HIS led to the General filing
a ‘statutory complaint’ with
the Defence Minister, which
was rejected on the basis of a premanufactured legal advice tendered
by the Attorney General trashing
the birth and matriculation certificates and upholding a faulty application form. This forced the General to
move the Supreme Court for justice.
That this justice was denied to him is
yet to become history. A well-drafted
memorandum highlighting the
injustice, sent to the President of
India by over 1,200 former generals, brigadiers, colonels, majors,
other veterans and civilians,
was not even acknowledged!
As this was raging on, seven
eminent citizens—from civil
and military—moved the
Supreme Court, pointing
out the Defence Ministry’s
manipulations to cut short



21

GOVERNANCE


the tenure of General VK Singh and
the premature announcement of Lt.
Gen. Bikram Singh as the Army Chief
without finally resolving the DoB
issue of the former. The basic issue
was army’s institutional integrity,
promotion of the obnoxious ‘line of
succession’ killing merit and grave
allegations against the Army Chief
designate: fake-encounter death
of a 70-year-old man in Jammu &
Kashmir pending in the State’s High
Court and serious cases of indiscipline and abuse by Indian troops in
the Congo Republic, commanded
by the then Major General Bikram
Singh, being investigated by a Court
of Inquiry at Meerut.
Even before the petition was heard,
led by a ‘Delhi-based English daily’,
the media went viral calling it a communal PIL. In the event, the SC dis-

missed it in limine, while allowing the
proceedings against General Bikram
Singh to continue in J&K High Court
and Meerut’s Court of Inquiry. The dismissal is based on a clearance report
given by Intelligence Bureau and a
fudged file of the Cabinet Secretariat
presented as original file by the
Attorney General. Immediately after
the PIL’s dismissal, RTI applications
were filed in the Cabinet Secretariat
and MoD for copies of this file, which
till date have been dishonestly denied
by these entities as well as the Central
Information Commission. One could
see clear machinations and manipulations to conceal the truth!

T

HE twin ‘Swords of Damocles’
hanging over the head of the
Army Chief have severely compromised the command structure,

The TSD tantrum

T

HE Technical Support Division
(TSD) was created in 2010 in
response to the November 29,
2008, dastardly attack on Mumbai
by Pakistani terrorists, who were
subsequently labelled by the media
as ‘non-State actors’. The unit was
set up following due procedures
with all the requisite government
sanctions.
The TSD is a covert operation
agency, activities of which are
directly related to the safety of
soldiers fighting on the borders,
retribution on the enemy and the
security of the citizens. By its very
nature, TSD operation was ‘top
secret’. In that event, even the
existence of TSD should never have
been publicised. Doing so could be
treasonous.

22



Yet on March 2, 2012, a leading
magazine published a story that inter
alia reads as below: “MOD officials
say they are also concerned about the
activities of a shadowy unit called the
Technical Support Division within MI…
Who the targets were and for what
purpose, is still not clear.” The MoD
conspiracy had commenced even while
VK Singh was chief and intensified
after he demitted office.
TSD’s location, officials and its work
were top secret and out of bounds.
However, on August 16, 2012, at
around 6 pm, a white Toyota Qualis
came towards the premises of the TSD
with two persons, later identified as Lt
General (Retd) Tejinder Singh and the
correspondent of the ‘leaky’ north
Indian daily. Security personnel
lodged a written complaint and the

institutional integrity and functional
efficacy of the Army. What is worse, it
has skewed the civil-military equation
heavily in favour of the former. We
are witnessing this on the borders of
Pakistan, where intrusion and killing
of our soldiers have become almost a
daily affair.
The government and its minions succeeded in hounding out VK
Singh. To achieve this, they went
to the extreme of abetting virtual
mutiny in the army by planting stories in a ‘Delhi-based daily’, suggesting that the serving Army Chief was
engineering a coup to overthrow the
Government of India. Within hours, in
a well-calibrated outcry, several MPs,
including the recently convicted Lalu
Prasad Yadav, wanted the General to
be summarily sacked and arrested!
Even after a year-and-a-half, this

matter was reported to the DirectorGeneral, Military Intelligence (DGMI).
After three days, the DGMI asked the
complainant to tear it off and destroy
the hard disk of the computer on
which it was typed!
In September 2012, the former
Defence Secretary (now CAG) initiated
the ‘Board of Officers inquiry’, headed
by Lt Gen Vinod Bhatia, to go into the
working of TSD and received the
report in March 2013. After six months,
the ‘leaky’ daily came out with banner
headlines: “Unit set up by VK Singh
used secret funds to try and topple
J&K government, block Bikram Singh:
Army probe”. The leak had come from
a former joint secretary in the Defence
Ministry and the alter ego of the
Defence Secretary-turned-CAG. As if
on cue, the daily went into frenzy and
whipped up the J&K angle, provoking
pandemonium in the State Assembly!
All the while, the present Army

www.gfilesindia.com

PHOTOS: UNI

blasphemy is yet to be probed and the
seditious intent brought to light!
Now to the Technical Service
Division (TSD) episode which is
bizarre as bizarre can be! (See Box).
Divulging information about this
unit is treasonous. Yet, there have
been leaks galore and media has been
‘breaking news’ as if it was cricket
match-fixing!

F

IRST it was the leaky ‘Delhi-based
daily’. Then a ‘national daily’
entered the scene, cooked up an
‘interview’ with VK Singh and spun a
false and preposterous story that he
claimed ‘the panchayat elections of
2011’ as a major achievement of the
TSD. There was backlash in the Valley
and the same national daily went into
frenzy by publishing a concocted
story that the General has caused “an

Chief has been playing ball like a
meek surrogate, instead of
defending the army unit and its
officers. What is incomprehensible is
that he took the opportunity to wind
up the TSD, leaving the Indian Army
with no covert operation and weak
counter-insurgency capability. It is
widely opined that if TSD had not
been wound up, the recent Samba
attack by Pakistan-based elements
(wherein several soldiers including a
Lt Col were killed) and many other
incidents could have been avoided.
There is also widespread belief
among senior army officers that the
scrapping of the TSD is a major
reason for a spurt in cross-border
intrusions over the past year, leading
to several deaths and humiliation
heaped on the country by China,
Pakistan and even Myanmar.
Whether there is a hidden agenda,
one wonders?

www.indianbuzz.com

IN BETTER DAYS: Former Army Chief General VK Singh (right) with Defence Minister
AK Antony at a function in Ooty

extremely serious apprehension of
militant attacks on more than 33,000
panches and sarpanches, as he had
completely discredited and maligned
the panchayat elections of 2011.”
This was followed-up from ‘On
Board the PM’s Flight to Washington
DC’ with a front-page headline story:
‘VK Singh’s claims damaged India’s
interests and caused enormous damage to the country’, obviously referring to money paid to J&K politicians.
Ironically, this is already an open
secret with former US ambassador
to India David Mulford’s revelation
in 2008: “Money from Pakistani and
Indian intelligence agencies and from
Saudi and other foreign extremists
has further distorted Kashmiri politics, incentivised leaders to perpetuate the conflict, and perverted State

and Central government institutions.”
In this entire media tirade, there is
not a whimper about who is responsible for the treasonous act of leaking the ‘top-secret’ document! India’s
national motto proclaims ‘Satyameva
Jayate’–“Truth alone shall Triumph”.
But the reality is that so far only lies
and falsehood have triumphed. That
is why India has been morphing from
a functional democracy to a dysfunctional kleptocracy and heading
towards a ‘failed State’.
In the prevailing atmosphere of
lies and deceit, serenading ‘satyameva jayate’ is expressing fond hope
of finding the needle in a haystack.
But, then, hope is the very essence of
human existence! g
(The writer is a former Army and IAS
officer. Email: deva1940@gmail.com)



23

GOVERNANCE


GOVERNANCE
AWARDS 2013

The Jury
shri prabhat kumar

shri anil razdan

shri m b kaushal

former cabinet secretary

former secretary, power

former special secretary,
home

shri r m malla
former CMD, IDBI

24

shri vishnu bhagwan
former chief secretary,
haryana



www.gfilesindia.com

GOVERNANCE
AWARDS

2013

Saturday,
November 30, 2013

For invite, please email with designation
and contact details
www.gfilesindia.com
summit@gfilesindia.in
www.indianbuzz.com



25

GOVERNANCE

civil services yogendra narain

Obey, or refuse
The time has come to amend the Government of India (Transaction of
Business) Rules, 1961, so as to clarify the situation in case of disagreement
between the Minister and the Secretary

T

HE contentious issue of Secretaries to the India shall be transacted in the Ministries, Departments
Government, acting on the orders of the Minister, and secretarial offices specified in the I Schedule of the
when a particular Secretary feels that the orders are Allocation of Business Rules in accordance with these
irregular or illegal, had come into public debate after the rules. The Ministers have been assigned one or more
2G scam. One Telecom Secretary refused to implement departments under these rules.
The other relevant rules for consideration are the
the orders of the Minister while the other did. The followGovernment of India (Transaction of Business) Rules
ing questions have emerged:
1. If the Secretary of a department gives his advice based 1961. Under this order, Rule 3 states as follows:
Disposal of business by Ministries—Subject to the proon the relevant rules and regulations, is the Minister
vision of this rule as in regard with consultation with other
bound to accept his advice?
2. If the Minister decides to go against the advice of the departments and submission of cases to the Prime
Secretary and orders differently, with or without reason- Minister, Cabinet and its Committees and the President,
ing, is the Secretary bound to implement the orders, even all business allotted to a department under the Government
of India (Allocation of Business) Rules 1961 shall be disif the Secretary feels that the orders are irregular?
3. If the Secretary is of the opinion that the orders given posed off by or under the general or special direction of the
Minister-in-charge.
by the Minister are illegal, what should the Secretary do?
Another relevant rule is Rule 4 which talks about inter4. If the Minister over turns the advice of the Secretary
and decides on a course of action which is not illegal but departmental consultation. This states as follows:
1. When the subject of the case concerns more than one
which is against the previous policy of the Government,
department, no decision be taken or order issued until all
then is the Secretary bound to follow his advice?
These questions are repeatedly coming to the forefront such departments have concurred or failing such concurboth at the Centre and the States. The issue is what should rence, the decision thereon, has been taken by or under the
be the appropriate or correct relationship between a authority of the Cabinet.
Under these rules, the Prime Minister and the Finance
Secretary and his Minister. The recent report of the CAG
and the action taken by the CBI further put a question Minister have the authority to call papers from any department for their perusal. The relevant Rule states:
mark on this relationship.
1. The Prime Minister may call
In the Government of India
If there is no violation of
papers from any department.
(Allocation of Business) Rules,
2. The Finance
Minister
issued by the President of India Transaction of Business Rules
may call for papers from any
under Clause 3 of Article 77 of the
but yet a major irregularity is department on a matter in which
Constitution, distribution of subtaking place on the orders of financial consideration is involved.
jects among the departments has
3. Any Minister may ask to see
been made (including all attached the Minister, e.g. advancing the
papers in other departments if they
and subordinate offices or other
time limit for submission of
are related to or required for conorganisations, including public secbids to favour a select few
sideration on any case before him.
tor organisations under the departRule 8 of the Transaction of
ment). It has been further ordered (as happened in the 2G issue),
that the Business of Government of what should the Secretary do? Business Rules further lays down

26


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another requirement. Under this rule, all cases of the
nature specified in the 3rd Schedule to this rule shall,
before the issue of order thereon, be submitted to the
Prime Minister or to the President or to the Prime Minister
and the President as indicated in that schedule.
What is the responsibility of the department Secretary
under these Rules? The relevant rule is Rule 11, which
defines the responsibility of departmental Secretaries.
This Rule states:
In each department, the Secretary (which term include
the Special Secretary, Additional Secretary or Joint
Secretary in independent charge) shall be the administrative head thereof and shall be responsible for the proper
transaction of business and the careful observance of these
rules in that department.
The question is whether Rule 11 over rides the Rule 3 of
the Transaction of Business Rules because under Rule 3,
the disposal of business is done by or under the general or
special directions of the Minister-in-charge.
Rule 11 clearly lays down that the Secretary of the
Department shall be responsible for proper
transaction of business and the careful
observance of the Business Rules in
that department.

A

LLOCATION of Business Rules are silent as to what
the Secretary should do if he finds that the transaction of Business Rules are not being followed by the
Minister-in-charge or if illegal orders are being passed by
the Minister-in-charge, or if the decision of the Minister
overrides the previous policy of the Government.
The practice being followed so far, both at the Centre
and the States is that once a Secretary disagrees with the
Minister on facts or policies, than the Secretary submits
the file for reconsideration to the Minister. This would
prima facie also cover cases where there is a violation of
the Transaction of Business Rules.
However, if there is no violation of Transaction of
Business Rules but yet a major irregularity is taking place
on the orders of the Minister, e.g. advancing the time limit
for submission of bids to favour a select few (as happened
in the 2G issue) what should the Secretary do?

NA

ARU

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27

GOVERNANCE

civil services yogendra narain

A

N attempt was made to find out the rule position if
any in the States on such matters.
The Governments of Meghalaya, Daman and
Diu, Tamil Nadu, Mizoram, Tripura Nagaland do not
have any provision in their Allocation of Business of
Rules to sort out differences of opinion between the
Minister and the Secretary of the department. However,
the following State Governments have made some
provision in this regard.

Jharkhand
Under Rule 56 of the Transaction of Business Rules,
whenever the Secretary of the department feels that deviation from Rules of Business has occurred, the Secretary
has to bring it to the notice of the Minister-in-charge as
well as the Chief Secretary.

Chhattisgarh
Under Rule 12 of the relevant rules, the Secretary of the
department should bring such deviation from Business
Rules, to the notice of the Minister and if the Minister
does not agree with the departmental Secretary, he will
bring it to the notice of the Chief Minister (through the
Chief Secretary).

Manipur
Rule 58 states that any departure from the Business of
Rules shall be submitted to the Chief Minister by the
Secretary of the department.

Assam
The Chief Minister and the Chief Secretary can call for
any file of any department. Under Rule 31.1 if there
is deviation from the Rules of Business, it is the duty of
the departmental Secretary to bring it to the notice of the
Chief Minister.

Haryana
If there is any departure from the Business Rules, the
file has to be submitted to the Chief Minister.

Andhra Pradesh
Any case of departure from the Business Rules has to be
submitted to the Chief Minister. Further under Rule 32D,
cases raising question of policy and cases of administrative
importance have to be brought to the notice of the Chief
Minister.
Further under Secretarial Instruction No. 7, if the
Minister passes orders contrary to the orders suggested in

28


the noting and where Secretary of the department considers it necessary to recirculate, circulation shall invariably
be interrupted and the files circulated to the Chief Minister
through Chief Secretary.
Secretarial Instructions No. 8 (A), (B), (C) and (D) of the
Andhra Pradesh Rules have laid down that when the
Secretary observes that any proposed course of action is
contrary to the provision of any rule or law, or is at variance with the previous policy adopted by the Government,
he will bring it to the notice of the Chief Minister.

Himachal Pradesh
The Chief Secretary can call for any file from any
department and after examination of the case, submits for
the orders of the Minister-in-charge of the department
and the Chief Minister. Further, any case of departure
from the Business Rules has to be brought to the attention
of the Chief Minister by the Secretary.

Madhya Pradesh
Under Rule 12 of the Rules of Business, if the Minister
differs from the Secretary relating to any issue involving
deviation from the Business Rules, the Minister has to
send the file to the Chief Minister.
Further, the Chief Secretary can call for any file of any
department and after examination submit the file
to the Minister-in-charge or to the Chief Minister.

Kerala
There are no clear cut rules regarding procedure to be
adopted in case of difference of opinion between the
Secretary and the Minister of that department. However,
Rule 24 of the Rules of Business provides that in a situation where the Secretary has reasons to believe that the
case at hand relates to a matter in which the Minister concern has personal interest, the Secretary can submit the
file to the Chief Minister. Similarly as per sub-clause (vi)
under clause (I) of Rules 34 of the same rule, the Chief
Secretary or Secretary of any department is given the liberty to bring the matter to the notice of the Chief Minister
if any departure from the Rules of Business has been
noticed.
The Department of Personnel, Government of India
which was asked to clarify stated that on this issue, Rule
3 of the Service Conduct Rule is relevant.
This rule talks about every member of service being
required to maintain absolute integrity and devotion to
duty and to do nothing which is unbecoming of a member
of a service. He/she shall always act in his own best

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directions of, the Minister-in-charge and Rule 11 of the
Allocation of Business Rules, which states that the
Departmental Secretary/Special Secretary shall be
responsible for the proper transaction of business and the
careful observance of these rules in the department.

A

Minister would be well within his rights to state that
under Rule 3 of the Transaction of Business Rules in
the Government of India, the work of the Ministry
has to be disposed off under his direction and therefore
even if the departmental Secretary points out certain
illegality/irregularities in the decisions he takes, there is
no violation of Business Rules and the Secretary should
implement these orders. On the other hand, the Secretary
can rightly say that he has only to ensure the properly
observance of these Transaction of Business Rules and his
duty and responsibility stop there. He should not be held
responsible for carrying out the orders of the Minister even
if the Secretary finds them prima facie wrong.

Recommendations

judgment which is true and correct except when he is
acting under the direction of his superiors.
The Department of Personnel, Government of India has
also stated that Articles 3,8,11 and 12 of Transaction of
Business Rules are important. These relate to submission
of cases to the Prime Minister and the President, responsibility of the department Secretary and departure from
rules wherein the Prime Minister may, in any case or classes of cases permit or condone departure from these rules,
to the extent he deems necessary.
From the above, it appears that in the Transaction of
Business Rule of Government of India, there is no provision
detailing the procedure to be adopted, where there is a
difference of opinion between the departmental Secretary
and the Minister, as is the case of certain States, quoted
above, where the departmental Secretary can approach
the Chief Minister directly or indirectly through the
Chief Secretary.
On the other hand, the two relevant provisions in the
Transaction of Business Rules in the Government of India
are Rule 3 which states that the business of the department
shall be disposed off by, or under the general or special

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In view of the above facts and to ensure clarity, it is
necessary to amend the Transaction of Business Rules of
the Government of India as follows:
Rule 3—After para one, add a new rule 3A as follows
Rule 3A—Every Minister shall,
at all times, while disposing
off cases brought before him maintain absolute integrity
and observe principles of Natural Justice and pass orders
impartially and without bias.
All orders of the Minister shall be in writing and if the
orders are passed orally the Minister shall confirm in
writing immediately thereafter.
Similarly in Rule 11 after the first paragraph, the
following should be added:
Where the Secretary of the department feels that any
decision of the Minister is contrary to the provision of any
rule or law or violates the Principles of Natural Justice or
deviates with the previous policy adopted by the
Government or violates the Transaction of Business Rules,
he will bring it to the notice of the Minister.
If the Minister still reiterates his previous orders, then
the Secretary may bring it to the notice of the Cabinet
Secretary who will then take the order of the Prime
Minister in the matter.
This would give enough justification for the Secretary of the
department to bring such matters to the notice of the
Cabinet Secretary/Prime Minister and also give the
Secretary adequate protection vis-à-vis the Minister. g



29

GOVERNANCE

parliament devender singh

Calledintoquestion

The orderly progression of Question Hour has been besieged by scenes of
incessant power struggle, of one-upmanship, pandemonium and unruly conduct

A

question is a powerful parliamentary device in the armoury
of an MP for seeking information on a matter of public imporof a Minister of the Government of
India. Insiders, however, say, more
often than not, MPs have certain
foreknowledge, and the latent intent
behind seeking information is to pinwaste, malpractices and acts of omission and commission of the Government. In each question, therefore,
hangs a different tale.
It is in recognition of the time
a potentially powerful tool of
oversight and accountability that,
hour of every sitting of Parliament,
known as the Question Hour, is
earmarked for asking and answering
questions. Ironically, over successive
Parliaments, the orderly progression
of Question Hour has been besieged
by, what look like, scenes of incessant
power struggle, of one-upmanship,
pandemonium and unruly conduct.
To allow the frayed tempers to cool
and to thwart an imminently ugly
confrontation
between
seeming
warring sides, the Chair has little
option but to adjourn or curtail the
Question Hour when all entreaties of
‘Order, Order’ go unheeded.
The loss of Question Hour
conjures up reminiscences of the
origin and growth of questions,
which is so inextricably intertwined

30


with the evolution of parliamentary
institutions introduced reluctantly by
the Britishers under the successive
doses of constitutional reforms.
The Legislative Council, introduced
under the Charter Act of 1853, which
transacted its business in the public
verbatim proceedings, allowed the
Members to discuss the propriety
of the measures of the Executive
Government. Lord Dalhousie, the
Governor-General, who presided over
the Council, is said to have started the
Lord Canning remarked sarcastically
on the nature of discussions that
the Indian Council “had assumed
jurisdiction in the nature of that of a
grand inquest of the nation” which it
was not intended to be. The British
functions of the Legislative Council
under the Indian Councils Act, 1861,

of Independence and the constantly
growing demand for self-governing
institutions forced the Britishers to
enact the Indian Councils Act 1892,
right of asking questions with a view
so that the people do not entertain
erroneous ideas or harbour unjust
apprehensions.
the Legislative Council, on February
16, 1893, by Raja Udai Pratap Singh
of Bhinga, who drew the attention of
Government to the hardships caused
to the rural people due to the burden
tour. The cultivators and the village
shopkeepers had to per force make
provision for the touring revenue
Home Member in the Council of the
Governor General replied that the

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Government of India “will, however,
have great pleasure in circulating
the Hon’ble Member’s question
and the answer given by him in the
Council to Local Governments and
Administrations, in order that their
attention may be specially drawn to
the matter, and that they may consider
whether the present arrangements
of hardship to the furnishers of
supplies, and, if not, in what way they
should be supplemented”.
During the period between 1893
and 1909, questions were asked and
answered on administrative, social,
economic, religious, political and land
revenue matters. Dadabhai Nauroji
and Gopal Krishna Gokhale used the
device to focus Government’s attention
especially on policies which affected
the status, dignity and freedom of the
citizens. The new Legislative Council,
set up under the Indian Councils
Act, 1909 further enlarged the scope
of questions by conceding the right
of asking supplementary questions.
The stridently growing demand for
‘swaraj’ forced the Britishers to enact
the Government of India Act, 1919.
In the Legislative Assembly under
sitting was earmarked for questions.

The device of questions was utilised
with great foresight and assiduity by
the Indian members. Questions were
asked about the appointment of Indian
Judges, the extension of services
after 55 years of age in the Railways,
washing arrangements in coaches for
passengers, admission of Indians into
discontentment among Government
servants, railway accidents, allotment
of Government quarters, delay in
delivery of post cards, creation
of the post of Cabinet Secretary,
interception of correspondence and
tapping of telephones of political
workers, removal of cattle byres
of Government employees in New
Industry, debarring of Government

There is a paramount need
to revisit the Question
procedure, to reduce the
notice period to the barest
minimum, moving over to
e-Parliament and new
innovations like
introduction of PM’s
Question Time

servants from joining political bodies
or associations, etc.
Questions were asked about the noncooperation movement, communal
disturbances, nomination of a lady
member to the Legislative Assembly,
by the police, detention of Mahatma
Gandhi, proposal for amnesty to
political prisoners, health of Subhash
Chandra Bose, release of ‘Garhwali’
Military prisoners, correspondence
between Mahatma Gandhi and
Government, death of a detune in
detention Camp, demand for release
of Pt. Jawarharlal Nehru, deportation
of Civil Disobedience Movement
prisoners to the Andamans, etc.

Q

UESTIONS were also asked
about trade agreements, rising
prices, gold reserve, drop in the
price of silver, price of petrol in India
and elsewhere, assessment of income
tax, prices of kerosene and petrol,
increase in the price of match boxes,
coolies working in the tea gardens of
Assam, etc.
The members of the Legislative Assembly, set up under the Government
of India Act, 1935, used the device of
questions with still greater vigour.
Questions were asked about the
British soldiers at Shimla and Pune,
child marriages, railway concessions
for the transport of fodder to the
famine ridden areas in Gujarat, export of monkeys, disparity in pay of
the British and Indian Commissioned

suffering from venereal diseases,
posts reserved for Scheduled Castes,
grow more food campaign, import of
food grains, India’s dollar position,
the steps taken to root out corruption
and bribery in Government, etc.
As the freedom struggle became

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31

GOVERNANCE

parliament devender singh

remarks that ensue if the questions
ously, no other device gives such a
vast and equal opportunity to the
members—the party bosses and the
backbenchers—cutting across the
political spectrum, to seek informa-

A common scene during a Lok Sabha session

political prisoners and matters concerning the Indian independence
struggle, prohibition of Congress elec-

certain persons, prosecution of Pandit Nehru and the amenities provided
to him in jail, activities of Subhash
Chandra Bose in East Asia and the
joining of hands of Indian prisoners
of war with the Japanese to take arms
against British India, steps taken for
better treatment of political prisoners, detention of Jaiprakash Narain
and the amenities provided to him
in jail, the reasons for declaring the
Congress pledge to observe 26 January as Independence Day as sedition
by the Government, illness and death
of Kasturba Gandhi, and condolence
message to Mahatma Gandhi, detention of Dr Lohia, hardships experienced by members of the Azad Hind
Fauz in Rangoon Central Jail, etc.
Questions were also asked about the
decay and disintegration of Indian architectural arts and monuments and

32


the steps taken for their preservation.
A quick glimpse of the questions
asked and answered in the successive
Councils and Legislative Assemblies

Indian members and the remarkable
assiduity and foresight with which the
device of questions was deployed by
them notwithstanding the restraints
and fetters imposed by the imperial
power. It’s a matter of deep concern
that after 60 years of Independence
and as more years roll by, due to
growing disruptions, chaotic scenes
and the tendency to troop to the well of
the House, the Members get deprived
of the right of asking questions.

T

HE loss of Question Hour time
is essentially a loss of valuable
opportunity to the backbenchers and a great reprieve to the Ministers who dread the Question Hour
most for the barrage of inconvenient
and excoriating supplementaries
and the heckling and the inane cries
of ‘shame’, ‘resign’, and the caustic

call the Government to account. Such
is the electrifying effect and mystique
of the questions that once Parliament
goes into session and the advance notices of questions start reaching the
Ministries, they get awfully engaged
with the issues raised and their possible redressal while formulating replies. During sessions, the work focus
of Government shifts to Parliament
and, in fact, Parliament House teems
with civil servants and the visitors’
the Question Hour is over. It’s disappointing when so much time and
resources become infructuous due to
the washout of the Question Hour.
Unless there is a common realisation that the clamour and clash of
unruly scenes during Question Hour
and frequent adjournments cause
enormous waste of public time and
resources and irretrievable loss of opportunities to members across the political divide, the future seem uncertain. However, despite frequent washout of the Question Hour, the interest
of members, far from dissipating,
continues to grow as evident from
the constant increase in the notices
of questions. There is, therefore,
a paramount need to revisit the
Question procedure, to reduce the
notice period to the barest minimum,
moving over to e-Parliament and new
innovations like introduction of PM’s
Question Time. g
The author is a senior parliamentary
official and a student of constitutional
and parliamentary studies. The views
expressed here are individual. He can be
reached at dsaswal57@gmail.com

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gfiles inside the

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33

STATE SCAN

UNI

j&k mk kaw

Kashmir:
policy paralysis
If we enunciate a clear-cut forthright policy on Kashmir, India will no longer be
regarded as a soft State by the world community

K

ASHMIR is in the news once
again. Analysts are having a
field day, dissecting personalities, policies, predilections and preferences to understand what exactly
is happening and why. Most experts
say that Pakistan is indulging in violations of the ceasefire line to facilitate
the entry of saboteurs and terrorists into the Kashmir valley. Or, else
they feel that Pakistan is trying to
keep the Kashmir issue alive on the
international circuit because of the
session of the UN General Assembly
or because of meetings of the Indian
and Pakistani Prime Ministers with
Barack Obama.
What is missing from the discourse
is any serious debate on India’s
Kashmir policy. Taking into account
the history of Kashmir since 1947,
right from the first Pakistani aggression under the guise of the Qabaili
invasion to the 1965 and 1971 wars to

34


the Kargil misadventure, this period
has been a blood-spattered saga of
violence, sabotage, mayhem and genocide. Yet one searches in vain for a
white paper on India’s policy on
Kashmir, which clearly enunciates
what our goals and strategies are.
In the absence of an official policy
document, we have bits and pieces of
failed initiatives, ad hoc steps and offthe-cuff remarks. What the Prime
Minister and Foreign Minister are
reduced to is a reiteration of wellworn clichés. We say that Kashmir is
an integral part of India. The accession of the State to India is final and
irrevocable. Not only will India not
surrender an inch of territory in its
possession, but we are committed to
recover that part of the State which
was the victim of aggression by
Pakistan and which is referred to as
Pak- occupied Kashmir or PoK.
On the other hand, Pakistan has a

clear-cut one point programme,
namely, to grab Kashmir by hook or
by crook. They have tried every strategy to achieve this objective. In 1948,
they sent the so-called tribal raiders
and gobbled up “Azad Kashmir”. In
1965 they attacked India and then
took back at Tashkent their territory
conquered by India. In 1971, India
obtained its only victory over Pakistan
when it was able to bring Bangladesh
into existence. But the gains of the
battlefield were lost at Shimla when
Bhutto walked away with 95,000
PoWs without conceding an inch on
Kashmir. Indira Gandhi was not able
even to have the Line of Control (LoC)
accepted as the international border.
Pakistan did not give up. They
allegedly sent hordes of terrorists not
only to Kashmir but to all parts of
India. In the late 1980s, they created
an atmosphere of terror in Kashmir so
that almost all the Kashmiri Pandits

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gfiles Magazine November 2013

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