By Sanjay Raman Sinha

The case of beleaguered Telugu Desam president and former Andhra Pradesh (AP) Chief Minister N Chandrababu Naidu has become increasingly intractable. As the state CID tries its best to pin him down for alleged financial misdemeanours, the fight has reached the Supreme Court with Naidu filing a special leave petition challenging the Andhra Pradesh High Court judgment dismissing his plea to quash the FIR. 

The TDP supremo was arrested by the CID on September 9 on charges of financial fraud involving misappropriation of funds from the Skill Development Corporation when he was the chief minister in 2015, causing an alleged loss of Rs 371 crore to the state exchequer. Naidu, 73, is currently under remand in connection with the alleged corruption case. After his arrest, Naidu tweeted: “For the past 45 years, I have selflessly served Telugu people. I am prepared to sacrifice my life to safeguard the interests of Telugu people. No force on earth can stop me from serving Telugu people, my #AndhraPradesh and my motherland.”

More from the package

Prof Upendra Baxi on the Chandrababu Naidu arrest

Opposition leaders decry TDP chief’s arrest

Supreme Court on Manish Sisodia arrest

Court rulings on cases of political vendetta

As per the petition filed in the Supreme Court by Naidu, the FIR is a case of “political vendetta” as he is the leader of the Opposition in Andhra Pradesh. It said the political vendetta was clear from the belated application for grant of police custody. It said: “The CID is threatening the officers and others to implicate the Petitioner, his family and the Party. The continuing political vendetta by the State Administration is demonstrated from the fact that various senior leaders of the Petitioner’s party have in the past been arrested and now hastily are being sought to be implicated in false cases.”

The application for remand was focused on Naidu’s family “who are being targeted to crush all opposition to the party in power in the Respondent State with elections coming near in 2024”. It states that Naidu was “suddenly named in the FIR” and arrested in an illegal manner for political reasons.

Sanjay Singh, AAP MP, spoke to India Legal a day before his own arrest. “There is a trend that first the arrest is made, then the proof of crime is sought. This is unfortunate and disconcerting. In Chandrababu Naidu and Manish Sisodia cases, this is apparent. Prime Minister Narendra Modi and the BJP are responsible for this state of affairs. I believe that no action should be initiated with political malice. Action should be undertaken only on the basis of facts. The case is being probed, let’s see what comes out.”

The charges of politically motivated action were strongly contested by Kaushal Kishore, BJP MP. It is no secret that Naidu was close to the BJP before drifting away. Now with an eye on the elections, the BJP has been building bridges with the present AP CM, YS Jagan Mohan Reddy. Kishore told India Legal: “There is no involvement of the government in the Chandrababu Naidu case. The investigative agencies are doing their job according to the facts of the case. It is not fair to link the government with the action against Naidu. Investigative agencies are independent organisations and do their job without fear or favour. The government respects courts and follows their instructions.”

The CID has named Chandrababu as the “principal conspirator” and “accused number 1″ in the alleged scam. In its remand report, it has alleged that Naidu “indulged in a criminal conspiracy with the intention of fraudulent misappropriation or otherwise conversion of government funds for his own use, disposal of property which was under the control of a public servant, besides engaging in cheating, forging documents and destroying evidence”.

As per the petition, both the initiation of the probe and the registration of the FIR were without mandatory approval under Section 17-A of the Prevention of Corruption Act, 1988. Section 17-A provides that no police officer can conduct any investigation into an offence committed by a public servant where the offence is relatable to any recommendation made or decision taken by such a public servant in discharge of his public functions without the prior approval of the competent authority. It is stated that in the present case, the competent authority was the governor and his approval was not taken.

The petition states: “Section 17-A provides a filter from vexatious litigation. The present scenario of regime revenge and political vendetta is exactly what Section 17-A seeks to restrict by protecting innocent persons. The initiation of investigation without such approval vitiates the entire proceedings since inception and the same is a jurisdictional error.”

Accordingly, the registration of the FIR without approval under Section 17-A, as per the plea, is “absolutely illegal” and “nullifies all consequent actions including investigation, arrest and custody” of Naidu.

Earlier, the Andhra Pradesh High Court had dismissed Naidu’s petition to quash his arrest and remand. Thereafter, an anti-corruption court sent him to the custody of the state police’s Crime Investigation Department for two days. Naidu was arrested on September 9 and sent to judicial custody for a 14-day period.

Incidentally, the Andhra Pradesh State Skill Development Corporation was established in 2016 during the TDP government. The programme focused on the empowerment of unemployed youth by providing skill training.

The Siemens Centers of Excellence were aimed at bridging the skill gap between industry and academia. These centers also operate in Gujarat, Tamil Nadu, Jharkhand, Karnataka and Chhattisgarh. Ten per cent of the project cost is to be contributed by the AP government, while the rest is borne by Siemens. Siemens has an interest in the project as it plans to train engineering, diploma students and the faculty in Siemens equipment and software. Among the states that have implemented the project, AP established one of the highest numbers of clusters and trained the maximum candidates. AP ranked first in the country in the India Skills Report 2018 and 2019.

In June 2018, the Anti-Corruption Bureau received complaints from a whistleblower on the alleged scam. Thereafter, the CID started an investigation into the alleged scam worth Rs 3,300 crore in March. This apparently revealed that the project was initiated without following a proper tendering process.

To counter the charges of large-scale fund embezzlement, the TDP launched a fact-check website (apskilldevelopmenttruth.com) which countered many of the charges. It held that Siemens’ skill development project was based on a 90% grant in kind from the company and hence, it was not required to float tenders when the company is receiving something as a grant. As to the charge of corruption of Rs 371 crore in the project, the TDP website held that the forensic auditor’s report did not have details of how much money was exactly misappropriated. Different figures are circulating in the media.

The TDP website also refutes the allegation that before any expenditure by private entities, the government had provided an advance of Rs 371 crore, representing the entire 10% commitment by the government. It explains that there was absolutely no rush when this project was implemented in Andhra and due diligence was carried out before every step. After a government order, the first tranche was released on 30-06-2015 and the first payment of Rs 185 crore was released on 5-12-2015.  It was only after five months from signing the agreement that the first payment was released.

As the case was fought in the courts and charges traded, political brouhaha ensued. Fourteen lawmakers from the TDP were suspended for 24 hours for disrupting proceedings in the House to demand his release. Two of them were suspended for the session. TDP workers too have been protesting the arrest of their leader in a statewide campaign. 

In India, political vendetta is the running theme as can be seen from scores of arrests made by investigative agencies and the police. With the Andhra hustings round the corner, Naidu’s arrest is sure to affect the pre-poll alliance in the state. The TDP is the main rival to the ruling YSR Congress Party. The Indian National Developmental Inclusive Alliance (INDIA) has condemned the arrest and accused the state government of disregarding the rules.

Rashid Alvi, a senior Congress leader, told India Legal: “The central government is after Opposition leaders. Whether it is the ED, CBI or the IT Department, they don’t have any job other than taking action against Opposition leaders. This malafide action is now being replicated in states also. Politically motivated actions are a norm in Pakistan. There, leaders are witch-hunted and persecuted. Zulfikar Ali Bhutto was hanged. Now this dangerous trend is catching up in India as well. I am not aware of the legal nitty gritty in Chandrababu Naidu’s case, but if it is politically motivated, it is bad. This is bad party politics.”

Justice BG Kolse Patil, a former Bombay High Court judge, is forthright about Naidu being made a scapegoat on the altar of party politics. He told India Legal: “Yes, it is political vendetta. Today, all arrests are politically motivated and not on the merit of the case. If merit had been the case, then politicians across party lines would have been behind bars. Prime Minister Modi had once called a politician corrupt publicly and the very next day, he was anointed as deputy chief minister. If Chandrababu Naidu had aligned with the ruling party, he also would have been spared.”

The Supreme Court bench has asked AP government’s lawyer Mukul Rohatgi to place on record all material which was produced before the High Court in connection with the case.

Naidu’s petition argued: “The High Court has at one point observed that exercising jurisdiction under Section 482 Cr.P.C., it is not required to do a mini trial but yet has recorded detailed factual submissions which had no relevance to the challenge of the legal bar raised and itself conducted a mini trial to arbitrarily assume without basis that Petitioner has made ‘personal benefits’ for himself.”

As aspersions were cast on the judiciary, the judges hearing the Naidu case at the High Court faced flak via social media. The High Court, promptly issued contempt notices to all involved in the defamatory comments. 

Prof Upendra Baxi, renowned legal scholar, told India Legal: “When Donald Trump’s order was struck down by the federal court that no middle eastern people should enter America, he twitted ‘the so called judge’. Now you can’t call a judge so called; it is contempt of the highest order. Our politicians have not gone this far, nor have our media gone so far. Even during the Emergency when we felt that certain decisions were wrong, we never went that far. We never crossed the Laxman Rekha.”

However, the plea for bail for Naidu is not a standalone case. Umpteen cases initiated by investigative agencies against political leaders have seen pleas for bail run the judicial gamut of various courts. Whether it is Lalu Yadav, Manish Sisodia, Sanjay Singh or Satyender Jain, it is the same story. 

The principle “Bail is rule and jail is an exception” was enunciated by the Supreme Court in the landmark State of Rajasthan v. Balchand. The Court held that detention of an individual breached his right to life and liberty guaranteed under Article 21 of the Constitution.

Prof Baxi explained: “Bail is a matter of freedom. Bail or jail. So some special legislations like NDPS and UAPA exclude the idea of bail by law itself. How far that law is sound is for the appellate courts to decide. The common impression is that the CBI court, for example, doesn’t give bail even if it is permissible. It leaves it to the court of appeal. That’s the general impression. As far as appellate courts are concerned, it is clear that bail rather than jail is the constitutional norm. They go as far as saying that in case of national security laws like UAPA, bail under certain conditions is permissible. The point is that those who are in power and those who are victims of power are finely maintained by the Indian legal system.”

In Naidu’s case, the role of the CID is also under scanner. It is a fact that the police have become the handmaiden of political masters. There have been many verdicts where the police have been taken to task by courts for highhandedness. One reason for political victims languishing in jail for long is that the police or investigating agency is unable to produce evidence to substantiate charges. In Naidu’s case, the charges are long winded and the onus is on the CID to substantiate them.

Also read: Where is the proof? SC in Sisodia case

Former Director General of Police of Uttar Pradesh AK Jain explained the nuances of police action to India Legal. “Questions are being raised on the action against Chandrababu Naidu in the alleged scam. I have yet to assess the facts of the FIR, so it would not be proper to comment on the case. However, it is an accepted fact there is political pressure on the police, and they are constrained to follow the instruction of the executive. In such conditions, it is necessary that the Prakash Singh guidelines be followed, and the police be as independent as the judiciary. Only then can political influence be warded off. In such cases, if action is taken and evidence is forthcoming, then the police are constrained to pursue the case. The apex court has time and again held that personal liberty is supreme, especially in matters of bail, and it applies in Naidu’s case too,” he said.

It depends on the government whether it wants to keep Naidu under house arrest or in jail. In this case, Naidu has been kept in judicial custody and naturally, the TDP is opposing the move. People in power should understand that the tide of time can turn and when they are in the Opposition, they can also be victims. At another level, the central agencies misuse is cause of concern. 

GK Pillai, former home secretary, took a hard stand. He told India Legal: “All the heads of the central agencies are bound by the rule of law and the Constitution. If these agencies are misusing the law or are using it for political ends, then they should be hauled up in court. The agency in question has to face the consequence as it is depriving someone of their personal liberty. The head of the agency or whoever has taken that decision should be held accountable. Change will come when agencies who misuse the law have their heads being sent to jail.’’

The Chandrababu Naidu case has a sense of déjà vu about it. It’s the same story of alleged scam, charges of politically motivated witch-hunt and misuse of the state police for settling political scores. As always, it has taken the judiciary in its vicious clasp with unsubstantiated innuendoes. 

The age-old question still demands an answer. Rule of law, personal liberty, bail vs jail and political vendetta are issues which demand systemic resolution. 

Point-Counterpoint

In the alleged skill development scam CID chargesheet enumerated a series of charges which were rebutted by TDP in its website apskilldevelopmenttruth.com

ALLEGATION 1: Before any expenditure by private entities, the Government of Andhra Pradesh /APSSDC provided an advance of Rs. 371 Crores, representing the entire 10% commitment by the government. Why was there such a rush to implement this project?

TDP REPLY: There was absolutely no rush when this project was implemented in AP, due diligence was carried out before taking every step. It was only after 5 months after signing the agreement that the first payment was released. So where is the alleged rush? Teams were sent to Gujarat to study the project being implemented there, CITD (Central Institute of Tool Design) was approached to evaluate the entire project, so all the required steps to ensure transparency have been taken while implementing this project.

ALLEGATION 2:  Most of the money advanced by the government was diverted to shell companies through fake invoices, with no actual delivery or sale of the items mentioned in the invoices.

TDP REPLY: It is entirely an issue of GST tax evasion, whatever has been routed to a few companies from Skillar is to generate some fake invoices and claim GST tax credit.

How is AP govt responsible if some company doesn’t pay tax? From our side, we have released the amount of 371 cr which includes the required GST tax component also, so our tax obligation ends there.

Even in the remand report of CBN, they have not produced evidence of any money trail linking CBN or any of his family members or companies.

ALLEGATION 3: Contract was signed with Siemens without inviting tender

TDP REPLY: Siemens’ skill development project is based on a 90% grant in kind from Siemens, hence it is not required to float tenders when we are receiving something as a grant.

We should also understand that this software is a patented software of Siemens, no other company in the market would have this, it is exclusive to Siemens, so where is the question of tender here?

Did Jagan Reddy call for tenders when he signed an agreement with Byju’s? He was complimenting Byju’s Ravindran for his large heart and generosity for providing his content, now we all know that Byju’s is bankrupt and facing allegations.

Even Narendra Modi when he was chief minister of Gujarat did not call any tenders when he signed an agreement with Siemens, Can Mr Jagan Reddy dare to question the Prime minister on this?

ALLEGATION 4:  The investigation implicates prime accused Nara Chandrababu Naidu, along with the Telugu Desam Party, as beneficiaries of the misappropriated funds. There is a corruption of Rs 371 crores in the project

TDP REPLY: The Forensic Auditor’s report did not have the details of how much money was exactly misappropriated. Different figures are circulating in the media as there is no clarity about the amount being cited.  Forensic auditor’s conclusion of not engaging a professional evaluator to evaluate project cost is incorrect as a central government agency, the Central Institute of Tool Design was engaged for the same. Physical audit was eliminated from the scope of work of forensic auditor suspiciously in a pre-bid meeting though it was initially included. The investigation was based on inadequate information and faulty methodology to directly make any allegations of misappropriation.     

The post Chandrababu Naidu Arrest: Yet Another Scapegoat? appeared first on India Legal.