Strongarming The Strongarm

Uncaged Tiger

• Vijay Mallya ED goes after him for money-laundering in alleged def­a­ult of Rs 900 cr to IDBI bank in Kingfisher Airlines case

• Chhagan Bhujbal Investigates laundering from alleged kickbacks in construction projects

• Karti Chidambaram Claims to have unearthed properties worth millions in various countries

• National Herald After a change of director, ED pursues Sonia and Rahul Gandhi for misappropriation of the defunct newspaper’s property

• Robert Vadra Raids firm associated with him over money-laundering linked to a land grab

• Virbhadra Singh: The Himachal CM probed for money-laundering in a Rs 6 cr DA case

• NDTV: Notice for using tax havens such as Mauritius to bring in millions of dollars and evading taxes

 ***

In early March, BJP MP Kirit Soma­iya paid a late-afternoon visit to the Enforcement Directorate in the capital. As he came out, he told a reporter that former Maharashtra deputy CM Chhagan Bhujbal would be arrested soon. He even gave out a date: March 14. “This isn’t guesswork. This is confir­med,” he said. Presto! The NCP leader was picked up that day. Somaiya didn’t stop there. “Ajit Pawar and Sunil Tatkare (NCP’s state chief) are next. They should be arrested by March-end,” he said.

Whether the soothsayer from Mumbai Northeast is spot-on, Messrs Pawar and Tatkare will soon know, but how did a ruling party MP know what the ED was planning to do in the money-laundering and land-grabbing case involving NCP leaders? The NCP has no doubts. “This is political vendetta,” says its spokesman Nawab Malik. “First Somaiya makes a statement, then the ED action happens.”

Vendetta or not, the bustle in the otherwise soporific ED shows how the lines dem­arcating the political executive and the agency are blurring as prime minister Narendra Modi rolls up his sleeves. “ED is the new CBI,” says a senior finance ministry official. “It’s a bellwether of which way the PMO is thinking about corruption cases. Look at the headline-grabbing cases ED has taken on in recent months.”

• Exhibit A: Former finance minister P. Chidambaram’s son Karti. ED sleuths have visited him twice in three months, first in connection with a probe against firms owned by his friends, and then in the Aircel-Maxis case, in which Dayanidhi and Kalanidhi Maran, belonging to the exte­nded Karunanidhi family, are involved.

• Exhibit B: National Herald. Sources say the CBI had last year written to then ED chief Rajan Katoch that they were closing the case as no offence could be made out. But interventions from an income-tax off­icer and BJP leader Subramanian Swamy, both making the point that the well-connected ED chief was going slow in political cases, saw the director being shunted out. Special director Karnail Singh was made acting chief and the National Herald case was “reopened”.

• Exhibit C: Currently playing out on a TV screen near you—Vijay Mallya.

Add to these raids on a firm linked to Sonia Gandhi’s son-in-law Robert Vadra and an ED notice to NDTV for forex violations and the picture becomes clear.

To be sure, ED comes under the Union finance ministry, but the buzz is that an impatient PMO is leaning on it, often catch­ing finmin Arun Jaitley’s chosen babus on the wrong foot. ED sources bristle at the suggestion that its sudden activity is a case of political overreach or puppeteering from the top. On the contrary, they say the ED has been given a free hand because the CBI is dragging its feet despite—or because of?—its new-found “autonomy”.

Full Steam? Karnail Singh, an IPS officer, now heads the ED. (Photograph by HT)

For the first time in the tortured history of the “caged parrot” that is the CBI, the agency has a director appointed by a three-member collegium of the PM, the leader of the Opposition and the CJI. One reading is that an emboldened CBI chief, Anil Sinha, no longer beholden to the government, is not ready to do his master’s bidding. And so, it is implied, the ED is filling in.

There’s a gain of truth in that. The CBI has been resisting attempts to foist officials on it. Despite several vacancies, postings are stuck because, a source pointed out, “the CVC panel—secretary (personnel), the CVC and the CBI chief—haven’t met”, fearing that the CBI chief will resist. So officers empanelled at least seven months ago have not been promoted and nothing is moving. The old tussle between the agency and the government, which tries to push its own nominees, has only increased now. The CBI wants a major say in the appointment and promotion of officers at the joint director level, at which crucial, cutting-edge investigative work is done. Now, sources say, there’s an attempt at meddling even with DIG-level appointments: the government panel is pushing fresh faces instead of promoting officers already in the agency.

It’s different at the ED. While appointm­ents here are also through a CVC panel, a way has been found to circumvent it: three officers on special duty (OSDs) have been deputed to the ED from the central excise, customs and income-tax departments rec­ently. They are handling sensitive cases though they don’t have statutory powers and have been appointed only as advisors. It’s a moot point that the ED director, chosen by a process similar to the appointment of the CBI chief, does not enjoy the functional autonomy the latter does.

Insiders insist that, in attending to high-profile cases, the ED has gone slow on routine, ongoing cases. In fact, a recent Madhya Pradesh High Court judgement could put both routine and high-profile cases in jeopardy. Late last year, the Indore bench of the HC ruled that the ED must file an FIR before investigating money-laundering cases. So far, it’s an investigative agency like the CBI that files the FIR after establishing criminality, while the ED inve­stigates the “proceeds of the crime”. So far, the ED has not challenged the judgement, and litigants are using it to seek relief, saying the ED hasn’t filed an FIR yet.

As far as allegations of overdrive go, ED officials maintain that all cases are being investigated according to the law. Its spokesman says, “The ED is more active as the director sets targets for the year and March is approaching. The field formations have to fulfil their targets. Besides, the present director is an IPS officer and therefore very active in investigations.”

He also ruled out political interference. “In the NDTV case, prima facie there was an offence. A show-cause notice has been issued and adjudication is on. This was not an attempt to target a Congress leader,” he says. “There is no direction from the political leadership to work in a particular manner. The problem is, if we probe, we are accused of being overactive and if we don’t, we will be accused of complacency.” Thereby hangs a tale.