In what was possibly the last act of Enforcement Director Karnal Singh before retiring, he ensured that the agency filed the charge-sheet in the Aircel-Maxis case and named senior Congress leader and former Finance Minister P. Chidambaram as accused number 1 in the case.
There was a lot of speculation that the Enforcement Directorate (ED) would not be “allowed” to file the charge-sheet in the case as it was under a lot of pressure from various quarters to delay the same. The Supreme Court had given it three months’ time to file the charge-sheet.
However, the agency did so on 25 October, almost two months before the 20 December deadline, to make sure that the proceedings in the case were not delayed even if Singh was no longer a part of the department, according to official sources. “There is nothing more that the agency can do in the case. Now, all the evidence is before court,” they added.
The investigation in the case was being conducted by ED Joint Director Rajeshwar Singh, against whom multiple petitions were filed to get him removed from the case by discrediting him. Rajeshwar Singh had written a letter to Finance Secretary Hasmukh Adhia in June accusing him of not supporting him and rather standing by corrupt individuals. Later, he withdrew the letter and apologised for it.
Earlier in April, the Prime Minister’s Office (PMO) had received a complaint from an RTI activist against Rajeshwar Singh and his brother, a 1988-batch senior official with the Income Tax Department who is presently posted at Surat in Gujarat, of amassing properties in Uttar Pradesh, Delhi and Mumbai. The PMO had in turn directed the Revenue Department to initiate a preliminary enquiry (PE) into the allegations.
Apart from Chidambaram, his son Karti’s chartered accountant S. Bhaskararaman, Malaysian resident V. Srinivasan, Augustus Ralph Marshall of Aircel Televentures Ltd, Astro All Asia Networks Plc, Malaysia, Maxis Mobile Sdn Bhd, Malaysia, Bumi Armada Berhad, Malaysia, and Bumi Armada Navigation Sdn Bhd, have been accused of indulging in money-laundering in lieu of the illegal FIPB approval that was allegedly given by Chidambaram in March 2006 to foreign investor Global Communication and Services Holdings Limited, Mauritius (wholly owned subsidiary of Maxis Berhad, Malaysia), in violation of the various rules and regulations governing the FDI policy of India.
All these charges have been vehemently denied by the relatives and friends of Chidambaram, who has called it “vendetta politics” by the BJP. The hearing of the complaint will be heard on 26 November by Special Judge O.P. Saini.
Sources aware of the investigation said that under the rules and FDI policy in March 2006, Chidambaram was empowered to grant approval to proposals for foreign investment not more than Rs 600 crore. However, though the foreign investment proposal of Global Communication and Services Holdings Limited, Mauritius, was of Rs 3,560 crore, he gave his approval rather than referring it to the Cabinet Committee of Economic Affairs (CCEA) as per the policy.
“As per our legal team, the evidence that has been collected is enough to prove the wrongdoing. This includes email conversations, a trail that shows that how money that was offered in lieu of granting the approval was invested in the companies owned by the accused,” an official said.
During the financial year 2006-07, the FIPB conducted a total of 18 meetings in which 423 items were considered and 326 proposals were approved. The FDI inflow involved was approximately Rs 39,622 crore.
In 2007-08, 21 such meetings were held, in which 510 items were considered and 340 proposals were approved. The FDI inflow involved was approximately Rs 35,650 crore. During fiscal 2008-09, a total of 19 meetings were held in which 645 items were considered and 397 proposals were approved. The FDI inflow involved was approximately Rs 61,973 crore.
The 25-year-old FIPB, which was abolished in 2017, was a single-window clearance for FDI proposals and comprised Secretaries from Department of Economic Affairs, Department of Industrial Policy and Promotion, Ministry of Small Scale Industries, Department of Revenue, Department of Commerce, Ministry of External Affairs and Ministry of Overseas Indian Affairs.
Apart from the Finance Minister, the maximum say in the decision given by the FIPB, source said, was that of the Economic Affairs Secretary, a position that was quite coveted by bureaucrats. In May 2007, Duvvuri Subbarao, a 1972-batch IAS officer of the Andhra Pradesh cadre, was appointed as DEA Secretary after the retirement of Finance Secretary Ashok Jha.
Prior to the assignment, Dr Subbarao was working as Secretary to the Prime Minister’s Economic Advisory Council. In September 2008, Ashok Chawla, a Gujarat-cadre IAS officer of the 1973 batch, was appointed Economic Affairs Secretary. Earlier, he was its Additional Secretary from April 2005 to January 2007.
Later, Subba Rao went on to become the Governor of Reserve Bank of India (RBI) while Chawla became Chairman of the Competition Commission of India (CCI). He was later appointed as the chairman of the National Stock Exchange (NSE) in May 2016.