rediff.com Special: The hawala case, reopened

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The Rediff Special/ Irfan Aziz
The Supreme Court upheld the ruling that the Jain diary constituted insufficient evidence. That led to the discharge of all the hawala accused, one by one.
Part I: Ministers implicated
Central Bureau of Investigation sources disclosed that Amirbhai returned to India only after receiving assurances from two senior officers, one from the CBI and another from the Enforcement Directorate, that they would not pursue his case. These officers allegedly met Amirbhai in Zurich some time in late 1997 or at the beginning of 1998 (soon after the I K Gujral government fell). These officers reportedly assured Amirbhai a safe passage to India.
The CBI's argument in the hawala case was that Amirbhai was one of three recipients of foreign exchange kickbacks made by some multinationals. He was alleged to have been paid Rs 73 crore (Rs 730 million) in foreign exchange by the multinationals; the sum meant for the Indians allegedly involved in the hawala deal. From that point of view, it would have been cavalier on Amirbhai's part to arrive in India and voluntarily offer himself for investigation.
Justice Mohammad Shameem of the Delhi high court dismissed the case against Advani, saying the Jain diary was not sufficient evidence to hold the Bharatiya Janata Party leader guilty. The Supreme Court later upheld the judgment. Once the Supreme Court held that the Jain diaries were of no legal consequence, all the other accused were discharged.
How it all began
Nine years ago Delhi policemen raided premises in the crowded, predominantly Muslim Chandni Mahal area in central Delhi. According to senior police officers, foreign exchange irregularities and hawala transactions are common in this area. The police stumbled upon a large hawala network and through subsequent raids discovered that money was routed to Kashmiri militants through a student at the Jawaharlal Nehru University, Shahabuddin Ghauri, who was arrested in early 1991.
The police charged two individuals in the case, Ghauri and Devidayal, allegedly a hawala dealer. Devidayal is still absconding; Ghauri, whose trial concluded in conviction two years ago, is serving his sentence at the Tihar jail.
Later raids led to S K Jain's infamous diary which had 115 names in it, none of which the investigating officers initially took seriously. Names like L K Advani, Yashwant Sinha, Madan Lal Khurana, Balram Jakhar, Madhavrao Scindia, Sharad Yadav, P Shiv Shankar and Arif Mohammad Khan. The payoffs were allegedly made around 1988-1989 during the final months of the Rajiv Gandhi regime. The diary was sealed and for some time, no investigations were carried out on its basis. In the meantime, responsibility for the main investigation changed hands, from the Delhi police to the CBI.
At about the same time, CBI deputy inspector general O P Sharma was caught for allegedly seeking a bribe. The police alleged that Sharma, who was aware of the names in the diary, was trying to blackmail them. Sharma, however, claimed he was falsely implicated at Advani's instance because he had questioned the BJP leader on seeing his name in the dairy.
Before he was charged with the offence, Sharma, who retired with that stigma, was considered a fine officer who rose from the ranks to successfully investigate some of the most sensational crimes of the 1970s and early 1980s.
Till 1993, there was little progress on the hawala case and the file remained in a sealed cover. Most of all, no one in the CBI investigated the corruption.
In 1993, senior Delhi police officer Amod Kanth took over as DIG, CBI, and was entrusted with the case. Before joining the CBI, Kanth was officer on special duty to then minister of state for home Subodh Kant Sahay.
Sahay was close to then prime minister P V Narasimha Rao. Perhaps, that is why Kanth was entrusted with the case under the erroneous impression that he would be pliable on Rao's behalf. As things turned out, investigation into the diary commenced in Kanth's time.
However, differences within the CBI soon surfaced. One group of officers wanted to implicate Narasimha Rao. The other, led by then CBI director, Raja Vijay Karan, wanted to stick to the diary alone which mentioned Rs 65 crore (Rs 650 million) as the payoffs. Kanth arrived at the conclusion that the Rs 65 crore mentioned in the diary was not all, and that the actual payoffs amounted to Rs 73 crore (Rs 730 million).
Of the remaining Rs 8 crore (Rs 80 million), he surmised Rs 3.5 crore (Rs 35 million) was paid to Rao. Second, the CBI officials alleged since the payments were made by some MNCs, the foreign angle to the payoffs had to be investigated as well. However, according to some of these officers, the powers that be were unwilling to allow the investigation to proceed beyond the amount mentioned in the Jain diary.
According to the investigators, the Rs 73 crore were kickbacks from multinationals for the awarding of three power projects in north India and the modernisation of a steel plant.
The Rediff Specials
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	The Rediff Special/ Irfan Aziz *The Supreme Court upheld the ruling that the Jain diary constituted insufficient evidence. That led to the discharge of all the hawala* accused, one by one. Part I: Ministers implicated** Central Bureau of Investigation sources disclosed that Amirbhai returned to India only after receiving assurances from two senior officers, one from the CBI and another from the Enforcement Directorate, that they would not pursue his case. These officers allegedly met Amirbhai in Zurich some time in late 1997 or at the beginning of 1998 (soon after the I K Gujral government fell). These officers reportedly assured Amirbhai a safe passage to India. The CBI's argument in the hawala case was that Amirbhai was one of three recipients of foreign exchange kickbacks made by some multinationals. He was alleged to have been paid Rs 73 crore (Rs 730 million) in foreign exchange by the multinationals; the sum meant for the Indians allegedly involved in the hawala deal. From that point of view, it would have been cavalier on Amirbhai's part to arrive in India and voluntarily offer himself for investigation. Justice Mohammad Shameem of the Delhi high court dismissed the case against Advani, saying the Jain diary was not sufficient evidence to hold the Bharatiya Janata Party leader guilty. The Supreme Court later upheld the judgment. Once the Supreme Court held that the Jain diaries were of no legal consequence, all the other accused were discharged. How it all began Nine years ago Delhi policemen raided premises in the crowded, predominantly Muslim Chandni Mahal area in central Delhi. According to senior police officers, foreign exchange irregularities and hawala transactions are common in this area. The police stumbled upon a large hawala network and through subsequent raids discovered that money was routed to Kashmiri militants through a student at the Jawaharlal Nehru University, Shahabuddin Ghauri, who was arrested in early 1991. The police charged two individuals in the case, Ghauri and Devidayal, allegedly a hawala dealer. Devidayal is still absconding; Ghauri, whose trial concluded in conviction two years ago, is serving his sentence at the Tihar jail. Later raids led to S K Jain's infamous diary which had 115 names in it, none of which the investigating officers initially took seriously. Names like L K Advani, Yashwant Sinha, Madan Lal Khurana, Balram Jakhar, Madhavrao Scindia, Sharad Yadav, P Shiv Shankar and Arif Mohammad Khan. The payoffs were allegedly made around 1988-1989 during the final months of the Rajiv Gandhi regime. The diary was sealed and for some time, no investigations were carried out on its basis. In the meantime, responsibility for the main investigation changed hands, from the Delhi police to the CBI. At about the same time, CBI deputy inspector general O P Sharma was caught for allegedly seeking a bribe. The police alleged that Sharma, who was aware of the names in the diary, was trying to blackmail them. Sharma, however, claimed he was falsely implicated at Advani's instance because he had questioned the BJP leader on seeing his name in the dairy. Before he was charged with the offence, Sharma, who retired with that stigma, was considered a fine officer who rose from the ranks to successfully investigate some of the most sensational crimes of the 1970s and early 1980s. Till 1993, there was little progress on the hawala case and the file remained in a sealed cover. Most of all, no one in the CBI investigated the corruption. In 1993, senior Delhi police officer Amod Kanth took over as DIG, CBI, and was entrusted with the case. Before joining the CBI, Kanth was officer on special duty to then minister of state for home Subodh Kant Sahay. Sahay was close to then prime minister P V Narasimha Rao. Perhaps, that is why Kanth was entrusted with the case under the erroneous impression that he would be pliable on Rao's behalf. As things turned out, investigation into the diary commenced in Kanth's time. However, differences within the CBI soon surfaced. One group of officers wanted to implicate Narasimha Rao. The other, led by then CBI director, Raja Vijay Karan, wanted to stick to the diary alone which mentioned Rs 65 crore (Rs 650 million) as the payoffs. Kanth arrived at the conclusion that the Rs 65 crore mentioned in the diary was not all, and that the actual payoffs amounted to Rs 73 crore (Rs 730 million). Of the remaining Rs 8 crore (Rs 80 million), he surmised Rs 3.5 crore (Rs 35 million) was paid to Rao. Second, the CBI officials alleged since the payments were made by some MNCs, the foreign angle to the payoffs had to be investigated as well. However, according to some of these officers, the powers that be were unwilling to allow the investigation to proceed beyond the amount mentioned in the Jain diary. According to the investigators, the Rs 73 crore were kickbacks from multinationals for the awarding of three power projects in north India and the modernisation of a steel plant. The Rediff Specials Tell us what you think of this feature
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