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Jaitley’s All Praise For The CBI And IT Department, But Why Is Janardhana Reddy Walking Free?

The only ‘caged parrots’ are agencies like the CBI.

26/05/2017 8:45 AM IST | Updated 26/05/2017 8:45 AM IST
Hindustan Times via Getty Images

Reacting to the raids at the premises of P Chidambaram and Lalu Yadav on 16 may, by the CBI and the Income Tax department respectively, Finance Minister Arun Jaitley made two significant observations. The first:

"Unless there is a substantial basis and a reason to suspect that either there is evasion or a crime has been committed, these departments don't act. Because ultimately whatever action that is taken has to bear some results."

The Finance Minister's second observation was a clear attack on Chidambaram and Lalu:

"Now people in high positions acquiring assets through shell companies is not a small matter and I think a day of reckoning has come for many, they will all be held accountable."

Both of Arun Jaitley's comments are, on the face of it, unexceptionable. But dig deeper and you find how facetious these remarks are.

When the Congress was in power, these departments kowtowed to Chidambaram and even Lalu. Jaitley then used to make the usual "caged parrot"-type remarks about these agencies.

Who does not know that the CBI and Income Tax Department in India are not independent entities, that they change colours according to the affinities of the political bosses?

When the Congress was in power, these departments kowtowed to Chidambaram and even Lalu. Arun Jaitley then used to make the usual "caged parrot"-type remarks about these agencies. Now that the BJP is in power, these agencies are acting as the handmaidens of the ruling party, so Jaitley is now ladling out certificates of appreciation to them.

Take the case of the Reddy brothers, the mining barons of Bellary in Karnataka. Former Supreme Court judge Santosh Hegde, who later became the Lokayukta of Karnataka, had written in his report that the Reddys ran an independent "republic of Bellary" in complete disregard of the formal and legal institutions of the state.

And what did the CBI and the Income Tax departments do to this notorious mining mafia?

These agencies appear to have served according to what the political masters desired. The Reddy Brothers have been alleged to be financiers of the BJP. In fact, they are believed to have supplied the financial muscle for the emergence of the BJP (especially BS Yeddyurappa) as a major political force in Karnataka.

Remember the famous photograph of Sushma Swaraj giving her blessings to the Reddy brothers during the run-up to the 1999 Lok Sabha elections, when she challenged Sonia Gandhi in this Reddy heartland? The Reddy brothers were widely understood to be her major financiers then.

Sushma lost that election to Sonia but her close link with the mining barons remained intact for years. As a matter of fact, she kept visiting Bellary on Vara Mahalakshmi day for several years on the invitation of the Reddy dons and never did not try to conceal her closeness to them.

When Yeddyurappa became the first BJP chief minister of Karnataka in 2007, the Reddy brothers were duly rewarded: three members of the family were made ministers. It was presumed that the Reddy brothers owed their extraordinary political success to Sushma Swaraj to whom they were close.

The CBI had insistently opposed bail for Janardhana Reddy ever since his arrest. But with the NDA government in power, the CBI told the court that it had no objections...

But Sushma, in an interview to Outlook magazine had then said: "I have no hand in the political making of the Bellary brothers. I had nothing to do in making them ministers...When the Bellary brothers were made ministers, Jaitleyji was the prabhari (in-charge of the state)... I had nothing to do with it. Rather I was opposed to their appointment as ministers, opposed to three members of a family being made ministers."

In the same interview, she went on to re-emphasise:

"What the Bellary brothers gained politically was because of Yeddyurappa and the prabhari (in-charge) at that time, Arun Jaitley. The Bellary brothers got their political benefits because of these people."

As his senior party colleague publicly said, Arun Jaitley was responsible for the induction of three Reddy brothers as ministers in the Yeddyurappa government. And what were the credentials of these brothers?

Justice Santosh Hegde's report on the Bellary mining scam laid bare the shenanigans of the Reddy mafia meticulously. First, the report brought to attention how the state allowed the Reddy brothers to plunder natural resources legally. The Reddys, who controlled the iron ore mining operations in Bellary, were asked to pay just ₹25 per metric tonne of royalty to the state at a time when they earned ₹5000 per metric tonne by exporting it to China. Not surprisingly, the Bellary dons reaped massive profits from this venture legally.

The illegal source of income was still higher: the major chunk of the iron ore mined in Bellary went undeclared. The Lokayukta report pegged the loss to the exchequer on account of the undeclared iron ore to ₹12,228 crore just in seven years.

In fact, the report records:

"[T]he payment of bribes, amounting to Rs 2.46 crores to 617 officials of various ranks and cadres of all connected departments, for favours such as non-checking of overload and trip sheets, allowing lifting of waste dumps from all types of lands, allowing extraction of floating ores from patta lands and forest land, excess removal of ore from regular leases and allowing transportation without payment of royalty and forest development tax."

This amount of ₹2.46 crore was only the tip of the iceberg and was the amount which could be pinned down with written records that the committee could lay its hands on.

The Hegde Committee report made national headlines. The Congress which was in power at the Centre unleashed the CBI and the Income Tax department to take on the Bellary mafia. In September 2011, the CBI raided the premises of Reddy brothers: it found ₹3 crore cash and 30kg gold in the residence of Gali Janardhana Reddy and ₹1.5 crore cash from the house of his brother-in-law, B V Srinivasa Reddy. Many incriminating documents were found with Somasekhara Reddy and Karunakara Reddy.

Emboldened by the BJP being back in power at the Centre, Reddy set out to mock the nation by staging a ₹500 crore wedding for his daughter.

Gali Janardhana Reddy, the chief of the mafia, went to jail as the CBI presented "irrefutable evidence" to nail the brothers.

But the locus of power changed at the Centre in 2014 and the CBI quickly changed its tune. Janardhana Reddy had been filing for bail ever since he was arrested but the CBI had insistently opposed it. But with the NDA government in power, the CBI told the court that it had no objection to Janardhana Reddy being granted bail.

Reddy was out on bail early in 2015. Emboldened by the BJP being back in power at the Centre, he set out to mock the nation by staging a ₹500 crore wedding for his daughter.

What was most galling was that he was doing it at a time our country was going through the pangs of demonetisation. When millions of Indians were standing in serpentine queues for hours to withdraw a meagre allowance of a few thousands from banks, this Bellary don was publicly ladling out crores of rupees to put up the most extravagant show.

In fact, a family driver who had gone on record saying that ₹100 crore of black money was converted into white by the Reddy brothers during the 50-day exchange period in November-December last year was found dead in mysterious circumstances.

Reddy was clearly showing the CBI and the Income Tax Department their true place. He was doling out the contempt they deserved. The Income Tax Department, expectedly, gave Reddy a clean chit—that all the money spent in the wedding was above board.

The CBI, on its part, reaffirmed its servility by taking a decision not to pursue the cases against the Reddy brothers in the court.

Is it a surprise then that our honourable Finance Minister has issued commendation certificates to both the "caged parrots", the CBI and the Income Tax Department?

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