New Delhi: Last week, the Enforcement Directorate (ED) made a startling disclosure in the Supreme Court with regard to the seven-year-old alleged Public Distribution System (PDS) or Nagrik Apurti Nigam (NAN) scam in Chhattisgarh.
Solicitor General Tushar Mehta claimed that a sitting High Court judge of the state was in touch with “constitutional authorities” who were helping one of the two accused in the alleged scam to get anticipatory bail. Both of the accused — serving bureaucrats in Chhattisgarh government — are under ED’s lens for their alleged involvement in the scam.
Mehta further alleged that a “senior functionary” in the Chhattisgarh government was “actively involved in weakening” the predicate offence, registered under the anti-corruption law and probed by the state police.
What the solicitor general was trying to suggest was that if the predicate offence is not established in court, it would result in dropping of money laundering charges levelled by the ED against the accused.
Mehta made his submission before a bench led by Chief Justice of India (CJI) U.U. Lalit when it took up ED’s plea to transfer the investigation into the alleged PDS scam to the Central Bureau of Investigation (CBI). A notice on the petition was issued to the Chhattisgarh government in December 2021, seeking its response on why the probe should not be transferred to the CBI.
CJI Lalit’s bench, which allowed both Mehta and Chhattisgarh government to file their submissions in sealed covers, will now hear the matter on 26 September.
In this backdrop, ThePrint explains the alleged PDS scam that rocked the then Raman Singh-led BJP government in Chhattisgarh in 2015, twists and turns witnessed in it ever since, including ED’s intervention in the case after the current Bhupesh Baghel regime took power, and status of the trial — which ED wants deferred until a decision is made on its plea to transfer the probe to CBI.
What is Chhattisgarh PDS scam
The alleged PDS scam came to light when the state’s Anti-Corruption Bureau (ACB) conducted raids on the offices of NAN, the nodal agency for ensuring effective operation of the PDS system in the state, in February 2015 and seized unaccounted cash amounting to Rs 3.64 crore.
An FIR was registered against 27 persons, accusing them of distributing sub-standard quality of rice and salt through fair price shops. Two senior IAS officers, Anil Tuteja (former chairman of NAN) and Alok Shukla (former managing director of NAN) were suspended for overlooking the descrepancies.
Action was taken after police chargesheet pointed out their role in the scam. Charges were finally pressed against them in December 2018, almost two years after the Centre had its approval to prosecute them. According to the anti-corruption law, prosecution of a sitting bureaucrat can only be done after his/her governing authority gives a go ahead.
Rice and salt samples picked up during the raid were tested for their quality. At least 111 of 254 samples of rice and 64 of 185 samples of salt were found to be “sub-standard and unfit for human consumption”.
Further investigation revealed the samples were cleared for PDS distribution by flouting norms laid down for clearing consignments.
During the raids, ACB seized several incriminating documents, diaries, pen drives and computers that contained details of monetary transactions and information on beneficiaries.
In June 2015, the state ACB filed its chargesheet in the case against 11 of the 27 persons named in the FIR. The remaining 16 were included in the list of 200 witnesses. Of the 11 accused, only one was a private individual, identified as Munish Shah.
As the case moved to an anti-corruption court for trial, a Raipur-based lawyer, Sudeip Srivastava, approached the Supreme Court to seek further investigation. Basing his plea on the documents attached to the chargesheet, he claimed the police investigation was flawed.
Srivastava questioned the police for not looking into the role of former NAN officials who occupied prominent positions before 2015. However, on the top court’s advice, Srivastava went to the state HC with his request.
But seven years and 53 hearings later, Srivastava’s PIL in the Chhattisgarh HC is still pending. Disrupted by recusals of six judges, retirement of one and a Covid break that spanned two years, the PIL remains undecided, even though complete arguments have been made in court twice.
Currently, due to the ED’s plea in SC, the matter has not progressed in the high court.
Speaking to ThePrint, Srivastava explained that he never sought re-investigation in the case, which ED is pursuing, but wants further probe. His only objection was to the “restricted police enquiry” in the matter, limited to certain individuals and keeping out a handful, who he believes were a part of the larger conspiracy in the scam.
Regime change in Chhattisgarh
While Srivastava’s PIL was being argued in the HC, a regime change happened in Chhattisgarh. With Congress coming to power in the state in 2018, the PDS scam also witnessed new developments.
Soon after assuming office, Baghel reinstated both Tuteja and Shukla and set-up a special investigation team (SIT) to “re-investigate” the scam. Tuteja is now Joint Secretary, Commerce and Industries, while Shukla, though retired, has been appointed as Principal Secretary.
Their appointments, however, resulted in more petitions in the HC — which were clubbed with that of Srivastava — demanding a stay on the SIT’s functioning. In February 2019, the HC restrained the SIT from carrying out any probe, observing that the same would amount to a re-investigation.
According to Srivastava, the ED stepped into the picture pursuant to the change of regime in the state. The central agency initiated a probe against Tuteja and Shukla on charges of money-laundering. In a follow-up, it then filed a petition before the top court in November 2021, seeking transfer of the case to CBI, and a re-trial in the case.
The petition was filed at a time when the trial in the high court was almost nearing completion.
About 72 of the 200 police witnesses have turned hostile during the trial, Srivastava said. He alleged that there are several loopholes in the police investigation that are likely to impact the trial and may also result in acquittal of the accused.
He emphasised that his assertion in this regard is not a “figment of imagination, but is borne out of documents the state police have placed in the court with the chargesheet”.
According to Srivastava, one of the accused, Shiv Shankar Bhatt, who worked as a manager with the PDS department, was arrested in 2006 for accepting bribes. But sanction to prosecute him was never granted till his role in the PDS scam came to light in March 2015. Srivastava further alleged that the police have not bothered to look into Bhatt’s past associations.
Moreover, a diary seized during the raid, containing details of collection of illegal money, has not been placed before the court with the chargesheet, he added.
Unsure whether an ED or CBI probe will make up for the flaws in the state police’s earlier investigation, Srivastava has asked the top court to hear him before deciding on the ED’s plea.
He now wants SC to order a court-monitored probe into the alleged scam.
“If ED is so keen for CBI to take over the investigation, then both central agencies should not focus on the 2019 period or the bureaucrats’ role alone, but probe from 2015 onwards or maybe earlier,” Srivastava told ThePrint.
(Edited by Amrtansh Arora)