BABUS RUN SCARED
The conviction of a top IAS officer for corruption sends shockwaves through the bureaucracy and threatens to paralyse government
Will they be penalised for decisions in cases that turn controversial?
On May 22, the Central Bureau of Investigation’s special court in Delhi sentenced former coal secretary H.C. Gupta and two other serving government officials—K.S. Kropha and K.C. Samaria—to a two-year prison term. Earlier pronounced “guilty” of wrongdoing in the allocation of a coal block in Madhya Pradesh to a private firm, Kamal Sponge Steel & Power Limited (KSSPL), in 2008, the three were also ordered to pay individual fines of Rs 1 lakh each. Besides the bureaucrats, the court imposed a Rs 1 crore penalty on the company and a personal fine of Rs 30 lakh and three-year jail term for its MD, Pawan Kumar Ahluwalia.
What should ordinarily have passed off as just another judicial decree suddenly had the entire civil bureaucracy on its feet. The convictions, in particular that of the former coal secretary, have left many aghast. Gupta, a 1971 batch IAS officer of the Uttar Pradesh cadre, is widely respected for his personal integrity. When the CBI first charged him, Gupta, who is known to live frugally, caused some consternation by refusing to apply for bail, asking the court to send him to jail instead. His colleagues said, “He simply didn’t have the means to hire expensive advocates to fight his case.”
Gupta, coal secretary from December 31, 2005, to November 2008, then joint secretary Kropha and
then director Samaria in the coal ministry were held guilty by the court for irregularities in allocation of the Thesgora-B Rudrapuri coal block in MP to KSSPL. The court held the bureaucrats guilty of criminal conspiracy and cheating under the Indian Penal Code and for corruption under the Prevention of Corruption Act (PCA).
The CBI alleged the firm had misrepresented its net worth and existing capacity. While framing charges against the bureaucrats last October, the court said Gupta had kept former prime minister Manmohan Singh (who held additional charge of the coal ministry) “in the dark” on the coal block allocation.
Gupta’s court-ordered incarceration marks the first of what could be a string of similar convictions resulting from the successive scams during the Congressled United Progressive Alliance’s second tenure (2009 to 2014).
The coal scam or ‘Coalgate’ surfaced in 2012 after the Comptroller and Auditor General’s report alleged that inefficient allocation of coal blocks had resulted in windfall gains to private companies, amounting to Rs 1.86 lakh crore. Subsequently, the CBI registered 53 cases wherein coal blocks had been allotted in violation of government policy. Some 33 of these pertained to allocations made to 168 firms from 2006 to 2009. Several officers, then at the helm of the coal ministry, were charged. Besides the MP allocation in which he was convicted, Gupta is facing seven other chargesheets in Coalgate, one of which includes another former coal secretary, P.C. Parakh.
Another case which could see many babus cooling their heels in jail is the six-year-old 2G spectrum allocation scam, in which former telecom minister, A. Raja, DMK MP Kanimozhi, former telecom secretary Siddharth Behura, Raja’s aide R.K. Chandolia and a whole retinue of corporate executives stands chargesheeted. Final hearings in the case were concluded in the last week of April in the CBI special court in Delhi.
Former chief election commissioner S.Y. Quraishi, of the same IAS batch as Gupta, says the conviction was “very unfortunate”. Quraishi insists the former coal secretary got entangled in a technicality of the anti-corruption law that serves to criminalise even routine administrative decisions taken in good faith. “Such verdicts,” he says, “will discourage bureaucrats from taking decisions.”
The conviction of Gupta and the others has set off a clamour of protest among the civil bureaucracy demanding urgent amendments to the Prevention of Corruption Act of 1988. Former bureaucrats like Quraishi insist that in its current form, the Act “is opaque and must be replaced by a more specific law that prevents corruption, but doesn’t trap innocents”.
The crux of these complaints is the highly contentious Section 13(1)(d), which mandates that a public servant stands guilty of corruption “if he, by corrupt or illegal means, obtains for himself or for any other person any valuable thing or pecuniary advantage”, or “by abusing his position as a public servant, obtain for himself... any valuable thing or pecuniary advantage”, or “while holding office as a public servant, obtain for any person any valuable thing or pecuniary advantage without any public interest”.
NITI Aayog CEO Amitabh Kant is emphatic in his support for Gupta. “The Act needs to be amended quickly,” he says. “Gupta is a man of impeccable integrity. This is a sad story of an upright, honest man handling a file. There is no penalty in the government for not taking decisions. Every decision you take will cause pecuniary advantage to someone and we take thousands of decisions.”
Former cabinet secretary Naresh Chandra too holds that Gupta may have been convicted on a “pernicious principle”. He says the court appears to have no conception of the government’s working and seems to have relied entirely on the presentation of the investigating officer. “The court ought to have had an amicus to brief it on governmental functioning,” he says.
Chandra says a secretary-level officer heading a committee cannot be expected to check every document before him. “Gupta couldn’t have seen each and every paper. Can a judge check whether all the affidavits (in a case) are correct?” he asks. He warns that if the law, in its present form, is more widely applied, “many more secretaries will go to jail. Or worse, governments could use it to fix officers (they see) as loyal to previous governments”.
The indictment of Gupta and the others raises a very pertinent question: how effective has an anti-corruption law framed in pre-liberalisation times been?
Not much, in the view of most serving and former civil servants. Corrupt officers, capable of manipulating the system, never leave a paper trail. Only honest people working by the rulebook get trapped. Officers say rather than attributing criminality to what could well have been an error of judgement or administrative lapse causing public loss, the government ought to deal with such cases administratively—by withholding promotions or increments.
Former bureaucrats suggest departmental inquiries to penalise administrative lapses. “In case of negligence, departmental inquiries would be more appropriate than criminal action,” says former Gujarat chief secretary Sudhir
KEEPING THE CIVIL BUREAUCRACY MOTIVATED, ESPECIALLY AFTER GUPTA’S INCARCERATION, WILL BE A TOUGH TASK FOR PM MODI AND HIS COLLEAGUES
Mankad. “Criminal action is justified only when there is quid pro quo or connivance between officers and beneficiaries, which would prove the officer has gone the extra mile to favour a competing party, setting aside rules.”
Quraishi goes further. “There was a scam and someone must have benefitted from it. Who are those persons? It is sad that all the big fish are out and honest bureaucrats become scapegoats,” he told india today in Delhi.
There is no evidence to suggest that Gupta made money; it is either an issue of oversight or error of judgement,” says a senior bureaucrat who is hopeful that key amendments to the PCA would be tabled in the monsoon session of Parliament, slated to commence on July 18. “To attribute criminality is farfetched and this will further aggravate fear. This provision (Section 13(1)(d) needs to go if India has to become a major economy,” he adds.
Bureaucrats argue that the mere existence of a law does not curb corruption; what’s needed are systemic measures, internal checks and controls. A retired bureaucrat suggests bringing in more lateral hires—of domain experts—for a duration of three to five years.
“Such a move does shake up the system. But beyond a level, one cannot have a high level of protection for civil servants,” says a serving civil servant in Delhi. “Even if there is private gain, the rule of reason should apply, not presumption of guilt.”
With the pressure to amend PCA—more specifically expunge the ‘offending’ Section 13(1)(d)—mounting, it will be quite a tightrope walk for the Narendra Modi government to balance its anti-corruption stance and pacify bureaucrats gripped with fear after the Coalgate convictions.
The government is in the throes of a war against corruption and can perhaps be credited with reducing corruption in the highest echelons—middlemen are out of
“The problem with the Act is that it automatically imputes corruption. You need to ensure this sword of Damocles does not hang over administrations” K.M. Chandrasekhar Former cabinet secretary “PCA is opaque and must be replaced by a more specific law that can prevent corruption, but doesn’t trap innocents” S.Y. Quraishi Former chief election commissioner “If the law were applied more widely, many more secretaries would go to jail. Governments could use it to fix officers seen as loyal to predecessor governments” Naresh Chandra Former cabinet secretary
work and kickbacks are no more the news. But keeping the civil bureaucracy motivated and productive, particularly after Gupta’s incarceration, will be a big challenge for PM Modi and his colleagues.
As part of its many promises, the BJP-led National Democratic Alliance government had reiterated the need to amend the Act. Union finance minister Arun Jaitley has been emphatically advocating this. At a public event in Delhi in March, Jaitley made a strong case for amending the Act, saying the distinction between erroneous and corrupt decisions is very thin in the law.
An attempt to fix the anti-corruption law was made in the latter half of UPA-II. But the Prevention of Corruption (Amendment) Bill, 2013, introduced by the UPA, could not be passed in Parliament. It sought to redefine criminal misconduct to include misappropriation of property and possession of disproportionate assets. The bill, which remained a draft, also included the offence of giving bribe to a public servant, including bribes by a commercial organisation.
Draft amendments to the Act, proposed in May 2015, replaced “valuable thing or pecuniary advantage” with “undue advantage”. Undue advantage was defined as any gratification other than legal remuneration. The amendment also includes the requirement of prior sanction to prosecute any serving public or retired official (in cases pertaining to the officer’s service).
Referred to the parliamentary standing committee (Select Committee of the Rajya Sabha), which gave its recommendations on August 12, 2016, the bill is yet to be tabled in Parliament. But in the wake of the uproar over the conviction of Gupta, Kropha and Samaria, there are indications that the Prevention of Corruption (Amendment) Bill will be introduced in the monsoon session of Parliament.
But even as the din amid the civil bureaucracy grows and the Modi government seems to be caving in to their demand to expunge Section 13(1)(d), a significant number of contrary voices within the IAS community have spoken out. Known to take tough positions, former cabinet secretary T.S.R. Subramanian believes diluting the law to protect honest bureaucrats would mean opening a convenient window for scores of corrupt officers to slip through. “Gupta was honest but he had certainly erred in being negligent. He kept his eyes closed when the loot happened. It was his duty to protect national interest. You have to be not just financially honest but intellectually honest too,” Subramanian told india today. Diluting the law, he says, would be a big blunder that would significantly blunt the Modi government’s campaign against corruption.
Subramanian bridles at the suggestion that decisionmaking and delivery of governance will slacken in the wake of Gupta’s conviction. “That’s humbug!” he exclaims.
While this is clearly a minority opinion in bureaucratic circles, Subramanian is not alone. On May 22, Ashok Khemka, the Haryana cadre IAS officer who hit the headlines in 2012 after he set aside a lucrative land deal between a firm owned by Robert Vadra and realty major DLF, tweeted his response to Gupta’s conviction: “Inaction abetting public corruption is a societal crime. Public servants are public trustees.”
Widely known, and even frowned upon by some of his own ilk, for the great lengths he is willing to go to serve what he perceives as ‘public interest’, Khemka vehemently disagrees with suggestions that the Act needs to be tinkered with. “They (bureaucrats demanding amendments to the law) all want Section 13(1)(d), which holds ‘wilful inaction leading to a crime’, to be scrapped. I simply don’t buy that argument,” says Khemka. Citing a hypothetical instance of government premises that are in the care of an officer, he asks: “Should (the officer) be absolved and acquitted of any responsibility if the place is used for some criminal activity, if he chooses to look the other way?”
Khemka also questions how the ‘personal integrity’ and ‘honesty’ of specific officers (Gupta in this case) was being held up to suggest that a travesty of justice had occurred. “What’s this concept of personal integrity? What value does such integrity have for the public?” he asks.
Similarly, many police officials are voicing support for the Coalgate convictions. Rejecting contentions that Gupta was ‘innocent’ since he did not personally or unlawfully benefit from the wrongful coal block allocation, senior IPS officers in Maharashtra point out that the law does not require a quid pro quo to be established.
“The law clearly says that if a government official’s action benefits someone at the cost of public interest, he is liable,” a senior police officer in Mumbai says. “Whether Gupta made money or not is not the issue. His action led to loss of public money. That’s a crime.”
But in the wake of jail terms for Gupta and others on May 22, top government sources say cabinet secretary Pradeep Kumar Sinha will shortly convene a meeting with PMO officials to deliberate on the imminent amendments. The blocks for an amendment to the Prevention of Corruption Act may finally be falling in place.
CONNIVANCE BETWEEN OFFICERS AND BENEFICIARIES NEEDS CRIMINAL ACTION, SAY FORMER BUREAUCRATS. DEPARTMENTAL INQUIRIES CAN ADDRESS NEGLIGENCE
BLACK MARK Former coal secretary H.C. Gupta at the Patiala House Courts on May 22, the day of his conviction