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IT Raids: Caught in a Bind

IT Raids: Caught in a Bind
MP Chief Minister Kamal Nath at a campaign rally in Chhindwara/Photo: UNI

Above: MP Chief Minister Kamal Nath at a campaign rally in Chhindwara/Photo: UNI

MP Chief Minister Kamal Nath is feeling the heat after IT raids were conducted on his aides and the EC recommended a CBI probe into alleged money transfers

By Rakesh Dixit in Bhopal

The threat of a CBI probe into dubious election funding to Congress candidates in Madhya Pradesh is looming large on the five-month-old Kamal Nath government. The source of unaccounted seized money is said to be fund mobilisation from the state government’s various departments.

After IT raids on five persons closely associated with Chief Minister Kamal Nath on April 7-8, the Election Commission recommended to the Department of Personnel and Training (DoPT) to institute a CBI probe into the alleged money transfer. The premises of the aides were searched during simultaneous raids conducted in 52 places. The searches were conducted at the houses of Nath’s nephew Ratul Puri and close aides Praveen Kakkar and RK Miglani in Indore and Delhi respectively. Puri is already under the scanner of probe agencies for allegedly receiving kickbacks in the AgustaWestland deal through his companies. He has been grilled by the Enforcement Directorate several times.

The state government, however, is trying to pre-empt a CBI probe on the grounds that DoPT cannot take a unilateral decision in this matter.

Government sources cite the ordinance issued by the Shivraj Singh Chouhan government in October 2012 which prohibits the CBI from taking up any matter under the state government without its prior permission. The previous government had invoked Section 6 of the Delhi Special Police Establishment Act, 1946 to prevent DoPT from recommending unilateral CBI probe into the matter under the MP government. That provision still holds.

Last week, Nath discussed the implications of the provision with the state’s additional advocate general Shashank Shekhar and Supreme Court lawyer Vivek Tankha after the EC’s recommendation to DoPT.

According to media reports, the IT department submitted detailed investigation reports and testimonies to the EC in connection with the raids which were conducted when the model code of conduct came into force. The EC, in turn, sent the report to DoPT.

Shadow on son too

Troubles are mounting for MP chief minister Kamal Nath as the Uttar Pradesh government has cancelled land allotment to the Institute of Management Technology (IMT), Ghaziabad, owned by his son and Chhindwara MP Nakul Nath. The land measuring 10,841 sqm was earmarked for constructing a hostel for IMT (above, far right). It has been found to be an illegal encroachment.

According to Ghaziabad BJP corporator Rajendra Tyagi, the land belongs to the state-run Chowdhary Charan Singh University (CCSU). On Tyagi’s complaint, UP governor Ram Naik, who is the chancellor of CCSU, shot a letter to UP Chief Minister Yogi Adityanath to initiate a probe into the fraudulent allotment of land worth crores to IMT College.

Following the submission of a probe report from a committee, Ghaziabad Development Authority (GDA) vice-chairman Kanchan Verma cancelled the land allotment on May 28. GDA has issued an order for demolishing the hostel building.

Interestingly, Nakul Nath was also the richest candidate contesting the fourth phase of the Lok Sabha elections. He declared assets worth Rs 600 crore.

The IMT website reveals that the prestigious institute was founded by Kamal Nath’s father Mahendra Nath in the 1970s. Presently, IMT holds high rankings among the private B schools in the country. Rajendra Tyagi, the complainant in the case, said that he was in possession of documentary evidence to prove that IMT grabbed the land of CCSU.

“Documents reveal that IMT was allotted a land by UPSIDC in 1973 near Rajnagar Extension. The Institute was supposed to be built on this land. However, at present, IMT’s distance learning centre is established on UPSIDC plot whereas the IMT main campus is built on a nearby land which is owned by CCSU’s LR Degree College,” claimed Tyagi.

—Rakesh Dixit

According to officials in DoPT, the EC made a strong case for a CBI inquiry in the complaint it sent on May 5. The report is annexed with two detailed investigation reports from the Central Board of Direct Taxes regarding search and seizure operations conducted in Delhi, Noida, Bhopal, Indore and Goa. The reports claimed huge money transfers to 11 Congress candidates of the just-concluded Lok Sabha elections in MP as well as payments to the tune of Rs 20 crore to the All India Congress Committee (AICC). The records sent by the EC are said to have damning evidence and testimonies which link the entire raids to the CM.

The EC’s missive to DoPT stated: “The CBDT has intimated that these searches have unearthed incriminating documents evidencing collection of money from government departments in Madhya Pradesh, ministers, officers and businessmen, a part of which, prima facie, seems to have been diverted for use by various candidates and a particular political party during the ongoing general elections to the Lok Sabha, 2019.”

The records show that the CM’s aides allegedly raised huge funds from various state departments. A detailed account of this was reportedly recovered from WhatsApp messages on the phone of Praveen Kakkar, former OSD to Kamal Nath. These include: Transport Department (Rs 54.45 crore); excise department (Rs 36.62 crore); mining department (Rs 5.50 crore); public works department (Rs 5.20 crore) and irrigation department (Rs 4 crore).

Nath has, however, claimed that he has nothing to do with the raids.

He reportedly said: “Let them send the case to the CBI, it does not matter.

It will have no effect. They can keep saying what they want. One of the persons raided, Himanshu Sharma, has already appeared on TV saying he works for the BJP.”

The EC’s report for the CBI inquiry includes diaries and receipts of alleged unaccounted money transfer, chat records and invoices which indicate money was being collected and transferred from MP. The Delhi unit of the Directorate General of Income-tax (Investigation) had initiated a search and seizure action on a group in NCR, Bhopal, Indore and Goa based upon credible information of large-scale collection, possession and movement of unaccounted assets.

Income tax sleuths have claimed in the reports and records that testimonies of the five aides of the chief minister corroborated with the allegations of money transfer to the candidates and the AICC headquarters. Investigators are said to have matched accounting records with testimonies and tracked money transfers through WhatsApp chats and intercepted phone conversations.

Investigators’ records show that former Madhya Pradesh CM and 2019 candidate from Bhopal Digvijaya Singh tops the list of candidates who received election funds from persons covered in the searches and that these details were gleaned from the computer of one Lalit Kumar Challani. He is described by IT as an accountant who worked with Miglani and Kakkar. Miglani, whose Delhi house was raided, refused to comment. Kakkar said no cash or documents were found from his home.

Records show that Lok Sabha candidates allegedly received between Rs 25-Rs 50 lakh through Challani and Digvijaya Singh received Rs  90 lakh. IT has noted that signed receipts for these payments have been traced only in the case of two candidates—Rajaram Tripathi (Satna) and Madhu Bhagat (Balaghat). The EC has said that as statements for election expenses for the Lok Sabha candidates will come in only by end-June, its action can wait.

Other Lok Sabha candidates who allegedly received funds through the “target group” are Meenakshi Natarajan (Mandsaur); Kamal Maravi (Mandla); Pramila Singh (Shahdol); Ajay Singh Rahul (Sidhi); Devashish Jarariya (Bhind); Shailender Singh Divan (Hoshangabad); Kavita Singh Natiraja (Khajuraho) and Pratap Singh Lodhi (Damoh).

In the case of funding for assembly elections held in November last year, the IT Department concluded that in all, Rs 17.9 crore was given by the group to 87 candidates and, out of them, 40 were elected to the assembly.

Other evidence recovered from the phones of Challani shows that Rs 17 crore was allegedly transferred by him to AICC to be used for the Lok Sabha elections. The IT report notes that this payment was corroborated in messages found in Himanshu Sharma’s phone and the testimony of Vijayan Damodaran, a member of Nath’s staff at his Delhi residence. The EC has asked the CBI to submit an “action taken report” on the CBDT’s findings to it every two months. It was on May 17 that DoPT dispatched the EC’s recommendation for a CBI inquiry.

Kamal Nath is struggling to save his five-month-old government in the aftermath of the landslide victory of Narendra Modi and is getting cornered from many sides. Buoyed by the Congress wipe-out in MP, the BJP has started the game to topple the government.