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Above: Former Finance Minister P Chidambaram being taken to the CBI court, in New Delhi/Photo: UNI

The trials and tribulations of the former finance minister P Chidambaram as he is sent to Tihar jail seem to indicate that judicial custody has become a symbol of vendetta politics

By Venkatasubramanian

The Indian legal process is a great leveller which ensures that those who are at the receiving end one day swap their roles later with those who used it against them. But even those familiar with this eternal truth of Indian politics would be surprised at the speed with which symbolism was taken to its logical culmination with the lodging of former Union Finance Minister P Chidambaram in Tihar jail on September 5.

Chidambaram’s arrival in Tihar jail as part of judicial custody in the INX Media case was a foregone conclusion with the police custody of the CBI coming to an end on September 5. The case involves alleged irregularities in Foreign Investment Promotion Board (FIPB) clearance given to INX Media for receiving foreign investment to the tune of Rs 305 crore against the approved inflow of Rs 4.62 crore. To Special Judge Ajay Kumar Kuhar who remanded him to judicial custody till September 19, the stage of investigation, “which is still in progress”, was the determining factor.

For those who wondered whether it was at all necessary to send Chidambaram to Tihar jail once the CBI admitted that it did not require him for questioning any longer, there were conflicting answers from the counsel representing the CBI and Chidambaram. The CBI submitted that he was an influential person and wielded substantial and pervasive influence over witnesses, having the potential to tamper with evidence. Chidambaram’s counsel, Kapil Sibal, on the contrary, argued that the CBI had not brought anything on record to even suggest that his client had ever tried to influence the witnesses or interfere in the investigation—factors which ought to have prevailed against keeping an accused in judicial custody.

Chidambaram’s counsel relied on other factors to buttress his plea to avoid keeping him in judicial custody: one, in the Aircel-Maxis money laundering case, another special judge, OP Saini, granted Chidambaram and his son, Karti, anticipatory bail. In his order, Judge Saini observed: “Considering the distance of time between the commission of alleged crime and the filing of the instant application, unexplained delay in investigation, there being no possibility of the accused tampering with the evidence or threatening any witness or fleeing from justice and there being no possibility of their committing a similar crime again, I am satisfied that it is a fit case for grant of benefit of anticipatory bail.”

In the Aircel-Maxis case, the allegation is that as Union finance minister from May 2004 to December 2008, Chidambaram gave FIPB approval of $800 million to Global Communications Services Holdings Limited, Mauritius, through Aircel Limited without obtaining the approval first of the Cabinet Committee on Economic Affairs. As finance minister, he was competent to grant approval on project proposals upto Rs 600 crore only. It is also alleged that Aircel Cellular Limited and Dishnet Wireless Limited (both wholly owned subsidiaries of Aircel Limited) were granted confirmatory FIPB approval, taking note of the aggregate FDI of 73.99 percent in Aircel Cellular Limited and in Dishnet Wireless Limited.

It is alleged that Karti Chidambaram, in lieu of the “illegal approval”, as alleged by the CBI, by his father in favour of Global Communication Services Holdings Ltd., received a sum of Rs 26,00,444 as quid pro quo through a company called Advantage Strategic Consulting Private Ltd (a company controlled by Karti) from Aircel Televentures Limited in the garb of providing management consultancy services. Another allegation is that Karti received quid pro quo through a company called Chess Management Services Private Limited (a company promoted by him) from the associate companies of foreign investor Maxis Communications Berhad, Malaysia. This was valued at Rs 90,08,936.

Judge Saini accepted the argument of Chidambaram’s counsel that it was an old case relating to 2006-07, and that the entire evidence was documentary in nature and in possession of the prosecution and as such it cannot be tampered with. It was further submitted that investigation was already complete and a complaint had already been filed and the presence of the accused was no longer required by the investigating agency. The judge also took note of the fact that Chidambaram was called by the Enforcement Directorate (ED) several times and he had answered all the questions put to him and he had fully cooperated in the investigation. The judge considered the fact that the accused duo had roots in society and there was no possibility of their fleeing from justice. As both were MPs and enjoyed a high standing in society, there was no possibility of their interfering with the course of justice or fleeing the country.

The only distinguishing feature between the INX Media case and this one is that investigation in the former is incomplete, whereas in the latter it is complete. Those who wonder whether this factor alone could have tilted the scales in favour of sending Chidambaram to judicial custody in the latter case must take into account another setback which he suffered in the Supreme Court on September 5 before the bench of Justices R Banumathi and AS Bopanna.

The bench, in a reasoned order, rejected Chidambaram’s appeal against the denial of anticipatory bail by the Delhi High Court in the ED case against him in the INX Media case. Although Chidambaram’s appeal also pertained to the CBI’s investigation in the same case, it had become infructuous in view of the CBI arresting him before he could avail of the Supreme Court’s interim protection. The bench vacated its interim protection from anticipatory bail in the ED case as well, following its September 5 order.

Curiously, although the ED advanced similar grounds against grant of anticipatory bail to Chidambaram before Judge Saini and the Supreme Court bench, both responded differently to them with two different results. It was submitted by Additional Solicitor General and ED counsel KM Natraj before Judge Saini that the allegations against the Chidambarams in the Aircel case were very serious in nature and that it was an economic offence committed with detailed planning and affecting the economy of the country. It was further submitted that the accused were indulging in tampering with the evidence and if released on bail, they might influence the witnesses. It was further submitted that considering the nature of allegations against the applicants/accused, there was “every possibility of the applicants/accused fleeing from justice”.

As in the INX Media case, the ED also submitted in the Aircel case that the investigation was not yet complete and was still going on, even in foreign countries, and letters rogatory had also been sent to different countries and the accused might obstruct further investigation. “Further investigation is a statutory right of an investigating agency and it should have full liberty for that including custodial interrogation of accused,” the ED claimed. The ED alleged that the Chidambarams floated shell companies and by using them, obtained bribes by using a circuitous and surreptitious route and indulged in money laundering.

The ED, as it did before the Supreme Court, alleged before Judge Saini that the accused did not cooperate with the investigation and did not join it as and when they were called by the investigating officers. The ED added that in an economic offence, bail should not ordinarily be granted and such offenders are required to be dealt with an iron hand. The ED argued—in much the same way it did before the Supreme Court—that custodial interrogation of the accused is a must as its efficacy is much greater than investigation in a case in which the accused are protected by an order of the Court.

Yet, Judge Saini found merit in the arguments of Chidambaram’s counsel and granted anticipatory bail to him. This was because of the conduct of the ED, which, instead of arguing on the point of cognisance, was seeking date after date since the filing of the complaint on the pretext that further investigation was still going on. “This conduct of the ED speaks for itself and needs no elaboration,” Judge Saini observed in his order.

Besides, Judge Saini took note of the fact that the other accused in the case, namely, Dayanidhi Maran and others, who were alleged to have laundered Rs 749 crore, were not arrested. “An investigation agency should not discriminate between two similarly situated accused, as this is against rule of law,” Judge Saini held. He added that unwarranted discrimination in the treatment given to different accused in the same case violates the basic norm of our Constitution that state instrumentalities should always operate in a just, fair and reasonable manner.

In the INX Media case however, the advantage that co-accused Karti Chidambaram and Padma Bhaskararaman had already been granted bail, was not extended to Chidambaram, although the principle of parity would make him entitled to it. The other accused, Indrani Mukerjea, Pratim Mukerjea and Peter Mukerjea, are on statutory bail. Justice Banumathi’s judgment of September 5 is silent on this aspect.

But on other grounds, her judgment differs markedly from that of Judge Saini, resulting in the denial of anticipatory bail to the accused. As before the Delhi High Court which rejected Chidambaram’s plea for anticipatory bail, the ED submitted a sealed cover to the Supreme Court, to look into the documents/material collected during the investigation allegedly showing the trail of money in the name of companies and the money laundering.

Chidambaram’s counsel had protested that the ED could not randomly produce the documents behind the back of the accused for seeking his custody. The bench took note of the documents even while indicting the Delhi High Court for copying and pasting from those documents. The bench justified it, saying it is only for the purpose of satisfaction of the Court’s conscience. “We have consciously refrained from opening the sealed cover and perusing the documents. Lest, if we peruse the materials collected by the respondent and make some observations thereon, it might cause prejudice to the appellant and the other co-accused who are not before this court when they are to pursue the appropriate relief before various forum,” the bench said.

Strangely, even while indicting the Delhi High Court single judge for extracting the note produced by the ED/CBI in his judgment denying anticipatory bail, the Supreme Court did not find that its judgment was vitiated because of that. “But such incorrect approach of the learned Single Judge, in our view, does not affect the correctness of the conclusion in refusing to grant   anticipatory bail to the appellant in view of all other aspects considered herein,” the bench concluded.

The bench also refused to conduct a “mini trial” and substitute its view for the view of the investigating agency about the cooperation or evasiveness of the accused to decide the question of grant of anticipatory bail. The bench agreed with Solicitor General Tushar Mehta that if the accused were to be confronted with the materials which were collected by the prosecution/ED with huge effort, it would lead to devastating consequences and would defeat the very purpose of the investigation into crimes, in particular, white collar crimes. The bench also accepted the ED’s contention that such an approach would help the accused to tamper with the evidence and destroy the money trail apart from paving the way for the accused to influence the witnesses.

Turning the well-recognised principle that bail is the norm and jail is an exception upside down, the Supreme Court termed anticipatory bail an extraordinary power and said that it has to be exercised sparingly. Grant of anticipatory bail, the bench held, interferes in the sphere of investigation of an offence and hence, the court must be circumspect while exercising such power, especially in economic offences, it held. With regard to the materials said to have been collected by the ED and considering the stage of the investigation, the bench was of the view that it was not a fit case to grant anticipatory bail.

The bench appears to have accepted the ED’s claims on the stage of investigation and the materials collected. The sealed cover submitted was not opened. The bench, however, granted liberty to the trial court to consider Chidambaram’s bail application on its own merits and in accordance with law without being influenced by any of its observations made in its judgment and in the High Court’s order.

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