How Virbhadra Singh Escaped The Law

Despite the fact that all evidence was in place against him in 2012 itself, the ‘long arm of the law’ still appears to be a long distance away from Virbhadra Singh. 

When Anand Chauhan suddenly started depositing big sums of money – roughly Rs. 5 crore in cash between April 24, 2008 and March 31, 2010 – in his Punjab National Bank account in Shimla, his account ‘automatically’ went into scrutiny. But when those deposits and subsequent, corresponding investments in LIC schemes were traced to erstwhile Royal and serving Himachal Pradesh Chief Minister Virbhadra Singh (VBS) and his family, all investigations ‘automatically’ froze.

I laid out specific details of Mr. Singh’s disproportionate assets and money laundering activities, backed with documentary evidence, in two pieces in The Hindu dated October 14, 2012 and October 22, 2012. The issue was immediately flagged by BJP leader, Arun Jaitley, who during the 2012 Himachal Pradesh Assembly elections, released details of Mr. Singh’s original and revised I-T returns, accusing him of forgery and money laundering while also writing to the then Prime Minister Manmohan Singh seeking a probe. These efforts, though made by the then Leader of Opposition in the Rajya Sabha, reached a dead end.

Letters by the NGO CommonCause and advocate/activist Prashant Bhushan of January 11, 2013 urging the CVC and the CBI to register an FIR and order a thorough investigation in the case went unheeded. Six months later, rather than taking appropriate action, the CVC, in a letter dated July 10, 2013, informed Mr. Bhushan that the complaint had been forwarded to the Steel Ministry.

On August 16, 2013, another set of letters to both the CVC and the CBI seeking expeditious investigation in the case met similar treatment once again, instead of acting, the CVC repeated in a letter of September 4, 2013 that it had forwarded the complaint to the Steel Ministry for appropriate action. Following this clear demonstration of lack of intent to act, an instant writ petition with the same facts and evidence presented in my stories, was filed by Mr Bhushan on behalf of Common Cause in the Delhi High Court in November 2013 seeking a “thorough, court-monitored investigation by the CBI or SIT into the alleged acts of money laundering, corruption, possession of disproportionate assets, criminal misconduct, etc committed by Virbhadra Singh”.  

It is now October 2015, exactly three years since Mr. Singh’s unseemly financial activities were first placed in the public sphere through the media exposes, but despite the fact that the entire evidence was in place in this open-and-shut case in 2012 itself, the ‘long arm of the law’ still appears to be a long distance away from displaying its heavy hand.

On October 8, 2012, my story on Robert Vadra’s growing fortune was published. The story quoted verbatim from company balance sheets to detail big gaps in financial accounting across his various companies, coupled with extremely questionable financial assistance from real estate major DLF Ltd in the acquisition of high value real estate, especially in Haryana. Almost instantly, the then Finance Minister, P. Chidambaram rushed to make a press statement, not to launch a probe, but completely ruling out any probe into “private transactions unless there are specific allegations of corruption”.

But ‘private transactions’, especially those involving unexplained surges in income and real estate assets routinely attract scrutiny, as Anand Chauhan’s case amply demonstrates. Surely DLF, being a listed firm, could have attracted a SEBI inquiry at the very minimum? When I went on to further expose the then Haryana Chief Minister, B. S. Hooda’s role in violating process to accommodate Robert Vadra’s land deals in a series of articles, that additional evidence also met with dismissal.

In its Report of Social, General and Economic Sectors (Non-PSUs) for the year ended 31 March 2014, the CAG went on to independently corroborate my charges of illegality in the Vadra scandal. It further highlighted that in the case of Vadra’s firm Skylight Hospitality Pvt Ltd, the fraudulently obtained land was sold to its collaborator DLF Universal Ltd at 7.73 times the original cost after the in-principle approval for transfer of license was granted in April 2012. Although net profit beyond 15 per cent of the total cost accrues to the public exchequer, the Department of Town and Country Planning, Haryana did not ensure that this money was deposited, neither at the time of granting in-principle approval nor at the time of formal approval for transfer of licenses. This deprived the state exchequer of sizeable revenue.

Despite this, three years on, neither Mr. Vadra, nor Mr. Hooda and his officials have been prosecuted. Even in the 2G and Coalgate scandals, although the outcomes were historic, many ‘big fish’ were kept out of the media and subsequently protected during the CBI investigations.

These cases amply demonstrate that ‘the long arm of the law’, while heavy on “ordinary” citizens and nimble footed in reaching them, has a convenient blindside when it comes to the power elite.

Justice delayed

Though it’s still likely to still be a long and dithery road to justice, the CBI has inched forward in the Virbhadra Singh investigation from a Preliminary Enquiry to Stage 2: the filing of a First Information Report (FIR) on September 23, 2015.

Following this, on September 26, 2015, CBI and Enforcement Directorate (ED) officials raided the CM’s private residence Holly Lodge located in Jakhu hills, Shimla along with searches in roughly 11 other locations in both Shimla and Delhi. It was widely reported that Mr. Singh was tipped off about the raid.

The CBI is expected to present its status report on the basis of its FIR and raids in the Delhi High court at the next hearing on October 14/16. The next step is the filing of a charge sheet leading to the arrest of the accused, followed by a trial and eventual conviction.

According to a copy of the FIR, a case has been registered against Virbhadra Singh, his wife, Pratibha Singh, Anand Chauhan, Chunni Lal Chauhan and unknown others for the cognizable offence of “amassing assets disproportionate to known sources of income” which is punishable under Sections 13(2) and 13(1)(e) of the Prevention of Corruption Act, 1988, read with Section 109 of the Indian Penal Code.

The FIR says that “relevant” documents and facts disclose that Virbhadra Singh, “while functioning as Union Minister, Govt of India during the check period from 28.05.2009 to 26.06.2012 acquired assets disproportionate to his known sources of income to the tune of Rs. 6,03,70,782 and further tried to justify the same in the form of agricultural income”.

The FIR adds that “Inquiry also revealed that Smt. Pratibha Singh w/o Shri Virbhadra Singh, Sh. Anand Singh Chauhan, with whom Sh. Virbhadra Singh has signed MoU for managing his apple orchard and Sh. Chunni Lal Chauhan Proprietor of M/s Universal Apples Associates who purportedly shown the purchase of apples of Shrikhand Orchards have facilitated in justifying disproportionate assets of Sh. Virbhadra Singh and thereby abetted the offence”.

Dilatory tactics

To buy time, Virbhadra Singh, on October 1, 2015 filed a petition in the Himachal Pradesh High Court seeking the setting aside of the CBI investigations and case against him and his wife on grounds that the CBI raids were conducted with malafide intentions and political vendetta.

Technically, the Himachal Pradesh High Court should not have interfered considering the matter is already before the Delhi High Court. However, while allowing the enquiry to proceed, the HP High Court has gone ahead and restrained the CBI from arresting Virbhadra Singh and his wife, additionally directing the CBI to keep the court informed before interrogating the couple.

Moving the Himachal High Court at this stage signifies nervousness. The reason is that this is an open-and-shut case where even the initial evidence (which was available in 2012 itself) is adequate to directly move to stage 3: the filing of a charge sheet, leading to the arrests of the accused.

Detailed evidence in 2012 itself

The details of the Virbhadra Singh scandal in my first article of October 14, 2012, showed that a document purportedly seized by the Income Tax Department during a December 1, 2010 raid on the Delhi offices of the Pramod Mittal-controlled Ispat Industries Ltd (IIL), recorded off-book cash transactions made by company staff from 2007 of Rs. 27, 74,535, Rs. 1, 00, 00,000 and Rs. 50 lakh to an individual identified as “VBS”. In addition, payments of Rs. 15 lakh were made to an individual “Min of Steel APS.” The cash payments added up to a little less than Rs. 2.5 crore.

In 2010, Himachal Pradesh-based Congress leader Virbhadra Singh held office as Union Steel Minister. His Additional Personal Secretaries were S.R. Singh and P.S. Raghuvanshi, while P. Durga Prasad and Shankar N. held the same positions for Minister of State for Steel, A Sai Prathap.

Rather than responding to repeated attempts by The Hindu to contact him, Mr. Virbhadra Singh instead told NDTV on October 14, 2012, the day the story was published, that he had no knowledge of these payments and that the surfacing of the allegations was simply an attempt by the BJP and its leader Arun Jaitley to influence the outcome of the impending Himachal Assembly elections.

However, the fact of the matter is that in the aftermath of raids by Income Tax Authorities at 50 locations owned by Ispat Industries on November 30, 2010, Mr. Singh was edged out as Steel Minister in the UPA reign itself after a tenure spanning less than 2 years (May 28, 2009-January 18, 2011).

Ignoring the fact that Mr. Singh would never have been edged out if there was no evidence of wrongdoing, Congress spokesperson Manish Tewari rushed to defend Mr. Singh at the time. “You will recall the Jain-Hawala case”, he told The Hindu, “where the initials of various political leaders were widely claimed to constitute evidence that they had engaged in corruption. The Supreme Court, however, later held that mere diary entries, which anyone can fabricate, do not in themselves have evidentiary value. It is easy to defame individuals.”

IIL was jointly owned by multinational steel tycoon Lakshmi N mittal’s brothers Pramod and Vinod Mittal. Pramod Mittal was the Chairman of IIL while Vinod Mittal was the Vice-Chairman and Managing Director of the loss-making company. According to the company website, as on June 30, 2010, the company posted a loss of Rs 322.34 crore. For the quarter ending September 30, 2010, IIL posted losses of Rs 331 crore, compared to Rs 79 crore during the same period a year ago.

JSW Steel had acquired 41 per cent stake in the debt-ridden IIL in December 2010, soon after the raids, for about Rs 2,157 crore. IIL was subsequently named JSW Ispat. JSW Steel later increased its stake to 46.75 per cent and remains the single-largest shareholder in JSW Ispat.

Both Pramod and Vinod Mittal owe a lot of money to Indian banks. Instead of being forced to repay these bank loans, they were allowed to use the corporate debt restructuring (CDR) route repeatedly as financial fortification and escape unscathed. Not surprisingly, in 2013, Pramod Mittal was reportedly in a position to splurge a staggering 60 million Euros for his daughter’s wedding in Barcelona, making it one of the most expensive weddings in history. Yet another telling example of how the law is selectively applied in India.

My second article of October 22, 2012, by linking the cash entries to ‘VBS’ from Ispat diaries to revised ‘income’ from apple orchards which were then routed to LIC policies, detailed the manner in which Anand Chauhan who was appointed manager of Mr. Singh’s apple orchards and investments, laundered money for Mr. Singh.

The article, fortified by relevant documents like Income-Tax returns, bank statements, affidavit of assets filed for nomination to the Himachal Pradesh Legislative Assembly elections in 2012 and MoU’s with Anand Chauhan and Bishambar Dass, revealed that Mr. Singh, who had a person called Anand Chauhan managing his money, filed revised I-T Returns in 2012 for the assessment years 2009-10, 2010-11 and 2011-12, soon after Mr. Chauhan’s accounts came under the scrutiny of the Shimla tax authorities in 2011.

Mr. Singh entered into a Memorandum of Understanding (MoU) with Mr. Chauhan on June 15, 2008 that the latter would manage his apple orchards and invest the proceeds/income from the sale of apples in “government securities, Mutual Funds, in schemes of LIC or to invest the money in the products of Scheduled Banks by ensuring safe and better returns.”

Mr. Singh’s MoU with Mr. Chauhan on June 15, 2008 for the management of his apple orchards and money is curious considering that he almost simultaneously entered into a similar MoU with one Bishambar Dass on June 17, 2008. Mr. Singh entering into two conflicting agreements for the management of an orchard on the same land for the same period raises suspicions that the MoU with Mr. Chauhan was formalised after his accounts went into scrutiny and additionally backdated as a cover up.

Between April 24, 2008 and March 31, 2010, Mr. Chauhan deposited roughly Rs. 5 crore in cash in his Punjab National Bank account in Shimla. He also made corresponding deposits by cheque for LIC premiums totalling roughly Rs. 5 crore in favour of the former Steel Minister, his wife Pratibha Singh and two children, Aparajita Kumari and Vikramaditya Singh.

Coincidentally, Mr. Singh’s revised I-T returns show an increase in agricultural income to the tune of Rs. 6.57 crore. While the original I-T returns document the net agricultural income at Rs. 7,34,000, Rs. 15,00,000 and Rs. 25,00,000 for the assessment years 2009-10, 2010-11 and 2011-12 respectively, the revised I-T returns, all filed on March 2, 2012, show staggering, corresponding escalations to Rs. 2,21,35,000 (a 30-fold increase), Rs. 2,80,92,500 (an 18-fold increase) and Rs. 1,55,00,000 (a 6-fold increase).

Mr. Singh’s affidavit of assets filed for nomination to the Assembly elections in 2012 lists three LIC policies in his name with premiums of Rs. 1,20,000, Rs. 50,00,000 and Rs. 1,00,00,000. Five LIC policies worth Rs. 1,00,00,000, Rs. 50,00,000, Rs. 50,00,000, Rs. 10,00,000 and Rs. 10,00,000 are listed in the name of his wife. His daughter Aparajita Kumari has two LIC policies of Rs. 10,00,000 and Rs. 5,00,000, while his son Vikramaditya Singh has 5 LIC policies worth Rs. 50,00,000, Rs. 10,00,000, Rs. 20,00,000, Rs. 5,00,000 and Rs. 5,00,000.

This conclusive evidence against Mr Virbhadra Singh in 2012, which is replicated exactly in Mr. Bhushan’s petition of 2013, has since been buttressed by two additional affidavits giving fresh evidence of money laundering (including in the purchase of a farmhouse in village Dera Mandi, New Delhi) and quid pro quo through Vakamulla Chandrashekhar, promoter of the Tarini Group. An admission of cash payment of Rs 5.41 crore in cash towards a total payment of Rs 6.61 crore for the purchase of the farmhouse and tax avoidance has also been obtained.

Ironically, an affidavit submitted in the Delhi High Court on behalf of Virbhadra Singh  acknowledges that “the cause to fight corruption is a laudable objective and any public interest filed to eradicate corruption should be welcomed”. However, alleging absence of common cause and calling it an “abuse of process of law”, while repeating Mr Tiwari’s argument of 2012 of diary entries being inadmissible evidence, the affidavit seeks its dismissal. Despite the written appreciation of crusades against corruption in his court affidavit, Virbhadra Singh’s persistent defence in the face of this clinching evidence of corruption against him, remains that he is a victim of ‘cheap’ vendetta politics, character assassination through implication in ‘false’ cases and misuse of the CBI by the BJP. All the ministers of the Himachal Pradesh state cabinet and members of the Congress Legislature Party have backed Mr. Singh by signing a joint statement to this effect.