31 May 2002

PROTECTING CORUPTION, YASHWANT SINHA WAY

From Jal Khambata

NEW DELHI: When you tap phones of Finance Minister Yashwant Sinha, you have to pay the price. Central Economic Intelligence Bureau Director-General A K Pande, who retired on Friday, has learnt it hard way.

He was first tried to be framed up for corruption in funding of his son's higher education in the United States and Yashwant Sinha on Friday moved swiftly to close the case against a revenue official who had actively participate to fix him up.

Pande was exonerated by no less than the Chief Vigilance Commissioner (CVC) N Vittal and he was empaneled for the post-retirement job of Settlement Commissioner in Calcutta but Sinha prevailed upon the Cabinet Committee on Appointments (CCA) to let the post go to D Raja who is to retire next month as a member, Excise, in the Central Board of Excise and Customs.

In what a Delhi tabloid dubs as "customising corruption" to portray how "protection breeds corruption and corruption finds protection", Sinha has helped the official accused of the frame-up not once but twice. Earlier, Sinha had dropped another case of a Rs 4.5-crore fraud in collusion with a Mumbai-based export firm, Select Impex Limited (SIL) in export of gold-strapped quartz watches.

The official, Sandeep Prakash, who is at present Deputy Director, Service Tax, had a godfather in K L Verma, Chairman of the Central Board of Excise and Customs (CBEC), who came to his rescue in both the instances. Both Verma and Pande are officials of the Indian Revenue Services (IRS) belonging to the same batch and had rivalry running between them for years.

On March 28, 2001, the CVC recommended "major penalty proceedings" against Sandeep Prakash in the Rs 5-crore fraud on the basis of investigations by Pande and CBI.

But Verma delayed action by referring the case to Joint Commissioner (Vigilance) P K Dash for comments and let the file remain pending until he got the Finance Minister's approval to drop the case and wrote back to the CVC early this month that the Minister, in his capacity as the disciplinary authority, has decided to drop the proceedings against Sandeep Prakash.

The sword of misrepresentations to falsely implicate Pande in the other case, however, still hanged on the head of Sandeep Prakash since Pande had shot out a lengthy letter to the Revenue Department on April 4 narrating how he was sought to be humiliated and attempts were made to throw his reputation in the mud just because he had investigated against this official.

Verma retired on May 30 but just a day earlier he shot off a 3-page note to the Union Revenue Secretary, recommending that "it would be more appropriate that FM's approval is taken to close the matter and for not proceeding against Shri Sandeep Prakash." And, the Finance Minister has now concurred with Verma to let Sandeep Prakash again go scot free.

The first case against Sandeep Prakash was cheating of the Government to the tune of Rs 4.5 crores as export credit to the Mumbai firm for exporting watches worth Rs 22.5 crore. Investigations proved that the export was only on paper and Pande got Sandeep Prakash transferred out of Directorate, Revenue Intelligence, in July 1999 in view of his involvement in this serious fraud.

Pande was, however, in a fix last year when a bombshell exploded accusing him of taking money from a company under his investigation for customs fraud for his son's education abroad and that too with all sorts of proofs including the cheques by which the money was received in his son's account. Details of the son's passbook were flung at him to prove source of all receipts in his account.

Undeterred, Pande, however, chose to carry out his investigation and ultimately established hand of Sandeep Prakash in fabricating the case against him but that itself is an interesting story.

Pande's son Aditya then working with Larsen & Toubro wanted to go to the US for post graduation. He told his father that names of the trusts who give grants and loans for such studies can be obtained from Charities Commissioner and so Pande simply A K Dhar, then Joint Director, Revenue Intelligence, in Mumbai to obtain the names and pass them on to his son. Dhar also suggested the name of one Jan Seva Trust.

As Pande has written in one of hs confidential letters to the Additional Revenue Secretary Anupam Dasgupta on April 4, 2002, he had asked Dhar "whether the Trust was good and clean, thereby meaning whether it had come to the adverse notice of the Department in any manner" and "Dhar had confirmed that the Trust was good and clean."

According to Pande, he had no reason to distrust a senior officer "who are asked to conduct similar verifications about individuals and firms frequently during the course of their duties." That was the end of the matter as Pande did not talk to anybody in the Trust but his son applied and got the funds.

Once the bombshell of corruption exploded, Pande carried out his own inquiries and found out that Sandeep Prakash who was then working as a deputy director under Dhar came to know about his request and it was he who suggested to Dhar the name of Jan Seva Trust. Dhar had not mentioned this fact while recommending the Trust.

Pande was at that time overseeing a vigilance investigation personally against Sandeep Prakash in the export fraud. Sandeep quietly approached Jan Seva Trust, got it money through cheques and persuaded it to issue a cheque of Rs one lakh in the name of Pande's son in response to his application for grant for foreign studies.

Sandeep kept copies of the cheques given to the Trust. He later obtained the details of the bank of Pande's son where the Trust cheque was credited and obtained the details of the transactions in the account to make out a case against Pande with what appeared like all the hard evidence needed to book one under the anti-corruption law.

Pande's trump card proved to be a letter he secured from B L Verma of the Jan Seva Trust exposing how Sandeep had arranged for the money to the Trust to issue a cheque to Pande's son and thus damage credibility of Pande overseeing the vigilance inquiry against him. END