3April 15, 2014

During the event-packed, freneticfour weeks when our fortnightlymagazine has been on the stands,the one question I am repeatedlyasked is why we call it IndiaLegal. Not that people dont like

the title. They find it authoritative. They find it catchyand different. But they remain mystified by ourchoice when they read the contents and discover thatthe magazine is not simply a handbook or digest forthe legal profession.

Precisely. And yet, members of the legal communi-ty who read it find it fits their niche reading needs.Veteran high court lawyer TL Garg called me from hischambers the moment he received his copy to say itfills a void. Well-known corporate lawyer RiteshKumar whatsapped me: The publication is reallygood. Intellectually stimulating.

Among other prominent lawyers who commentedis Ranjeev C Dubey, managing partner of N South,Advocates: I am most pleasantly surprised. Congra-tulations! Clearly, in the legal business, calling aspade a spade is only a contempt of court so your can-dor is commendable.

The comments have poured in not only from thelegal profession but also from general readers likeHilario J de Souza, who says: Thank you for present-ing legalese to us in a manner even I can grasp. Andthis from Krishan Kant, a Kingfisher Airlinesemployee: I am writing this letter to highlight theplight and agony of Kingfisher airline employees after19 months of battle( I feel) that India is run bypoliticians who plunder, bureaucrats who carry outillegal orders, ministers who violate the constitution,businessmen without a social conscience, lawyerswho sell out and judges who do not stick their necksout against executive skulduggery.

That last sentence is a direct quote from my previ-ous editorial. I quote these readers not to wallow inself-praise but rather to suggest that India Legal isprobably the right choice of a name. It is obvious thatthe magazine has mined a rich vein of readers inter-est. It has placed a niche perspective of the law withinthe wider ambit of a general readership. It hasbecome a marketplace for the discussion and tellingof all breaking stories and investigations within theperspective of their legal parameters. Its to the credit

L e t t e r f r o m t h e E d i t o r

I n d e r j i t B a d h w a r

editor@indialegalonline.com

of the unspoken wisdom of our constitution that weare a nation of laws and not man-made whimsies.

Take any major political, social or economic issuefacing the nation or the world, research and write onit within the legal framework and youve got an IndiaLegal story! The cover story of our first issue withexclusive pictures of bruises on Sunanda Pushkarsdead body raised legal issues about the investigation.Today that story has made national headlines. Theviscera report vindicates India Legals investigationsthat Shashi Tharoors wife did not commit suicide ordie of an overdose of drugs. The police now feel thatthe dozens of bruises on her body, which we revealedtwo issues ago, hint at a possible murder. Our secondissue with the legal conniptions over Oshos will andplagiarism charges against Arvind Kejriwal contin-ues to make waves, as I am sure will this issue.

Our cover story by NV Subramanian is onPolitical Liars, (a pun on lawyers) who have letdown our system of governance. Other stories includeGirish Nikams trenchant analysis on how and whyIndia will change, no matter who becomes the nextprime minister; Managing Editor Ramesh Menonsevocative feature on voting rights for Tibetanrefugees; Executive Editor Alam Srinivas take onwhether tougher laws could have prevented corpo-rate scams like Sahara and Satyam; arms merchantSudhir Choudhries murky empire; IPL and theunderworld connection; the legal limbo of aban-doned mothers; the misuse of anti-dowry laws; and ahard-hitting expose of judicial impropriety.

I am sure the bouquets and brickbats will fly fastand furious. Keep em coming. You can email yourcomments to editor@indialegalonline.com and wewill pay `1,000 for the letter we feature as Letter of the Week.

Cheers,

4 April 15, 2014

Editor-in-Chief Inderjit Badhwar

Managing EditorRamesh Menon

Executive EditorAlam SrinivasSenior EditorVishwas Kumar

Contributing EditorsNaresh Minocha, Girish Nikam

Associate EditorMeha Mathur

Deputy EditorsPrabir Biswas, Vishal Duggal

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SPECIAL REPORT

Arms and the murky manHe runs luxury spas, and donates to political parties and charities. But VISHWASKUMAR finds that Sudhir Choudhrie and his sons have earned their fortunes through controversial Indian arms deals with Russia and Israel

VOLUME. VII ISSUE. 15

12

18

Subrata-dum & Raju-deeWith companies like Sahara and Satyam always being one step ahead of law, will thenew Companies Act of 2013 help curb mega frauds? ALAM SRINIVAS investigates

CORPORATE

Published by Raju Sarin on behalf of E N Communications Pvt Ltd and printed atCIRRUS GRAPHICS Pvt Ltd., B-61, Sector-67, Noida. (UP)- 201 301 (India)

All rights reserved. Reproduction or translation in any language in whole or in part without permis-sion is prohibited. Requests for permission should be directed to E N Communications Pvt Ltd .

Opinions of writers in the magazine are not necessarily endorsed by E N Communications Pvt Ltd .The Publisher assumes no responsibility for the return of unsolicited material or for material lost or

damaged in transit. All correspondence should be addressed to E N Communications Pvt Ltd .

CFOAnand Raj Singh

VP (HR & General Administration)Lokesh C Sharma

APRIL 15, 2014

LAWYERPOLITICIANSFrom taking a lead in the national movement and nation building, the legal brigade in parliament has degenerated into a bunch of dynastic sycophants. NV SUBRAMANIAN traces its downfall 36

LEAD

5Water coffinsWhile Admiral DK Joshi resigned because of a seriesof naval accidents, the real problem is financialcrunch, lack of spares and delays in procurement. Report by VISHWAS KUMAR

23

THE NATION

Voters manifesto

Tibetan tango

Whichever political party comes to power this May, it will have to pay attention to issues like corruption and judicial accountability. It canignore the aam aadmi agenda at its own peril,writes GIRISH NIKAM

PHOTO ESSAY

SPORTS

Why is the refugee community reluctant to votein India, despite ElectionCommission giving them theright? RAMESH MENONanswers. Photographs bySHIVANI DASMAHAPATRAand JAVED SULTAN

In Dawoods den

Heil!

Despite its notoriety for matchfixing, BCCI has chosen Sharjah as the venue for IPL 7. A report by GAURAV KALRA

What is a real dictator? ROBERT D KAPLANanalyses whether authoritarian figures are necessarily bad for a country

74

R E G U L A R SLetters .....................6

Ringside ..................8

Supreme Court .........10

Consumer Watch ......78

Is That Legal? ...........81

Wordly-wise...............82

A L S OThe Hindutva debate continues ...30

Women & HinduSuccession Act ......34

EC & Gas pricing.......40

Sunanda Pushkarsmysterious death .......42

CIDCO judgment .......44

Education fraud in UP ..........................52

False dowry cases......56

Nursery admissionwoes in Delhi .............60

GLOBAL TRENDS

HUMAN INTEREST

Runaway bridegroomAfter Punjab, there is an increasing trend of GujaratiNRI bridegrooms deserting their wives. But help is athand, MAHESH TRIVEDI informs

27

48

64

70

PROBE

Cover Design: ANTHONY LAWRENCEPhotographs: ANIL SHAKYA

A fascinating readI read India Legal from cover to cover. Its aterrific piece of work a wonderful accom-plishment. Congratulations. I was fascinatedby your review of the real Abscam story.Yes, Hollywood is its own reality.

It goes without saying that your publicationof India Legal speaks to some of the vast dif-ferences and similarities between India andChina a central theme of To TheMountaintops.

Jim I Gabbe,Co-publisher, Raconteur, New York

A case for upper caseIndia Legal is an interesting addition to myreading list. I quite like the mix of stories inyour magazine, which I initially suspectedwould be cumbered by legalese. Happily,that's not quite the case. However, I have aquibble. Please start using letters in uppercase, wherever its conventionally merited, inthe intros and kickers for your feature stories.To see names in print written as n srinivasanor ems namboodripad is mildly irritating.

Vivek Rajagopalan, Chennai

Making valid points I enjoyed reading Revenge of the MuddleClass (March 31, 2014). It is true that the mid-

LETTERS

April 15, 20146

Hearty congratulations on the re-launchof India Legal.

I totally agree with you that after adecade, nothing has changed. I am aKingfisher Airlines employee and after 19months of battle to get our salaries I feelthat India is run by politicians who plunder, bureaucrats who carry out illegal orders, ministers who violate theconstitution, businessmen without asocial conscience, lawyers who sell outand judges who do not stick their necksout against executive skulduggery.

I am writing this letter to highlight theplight and agony of Kingfisher Airlinesemployees. The hard fought battle, during which we ran from pillar to postand almost begged for justice from allpillars of democracy, we came to knowthe dubious working culture of our system, where Subrata Rai has beenjailed but nobody in the system has

courage to take any action against VijayMallya; where there are labour commissions and labour law set by thegovernment but Kingfisher Airlines staffis still fighting for salaries.

The chief labour commissioner sent anotice to Vijay Mallya in February 2014but he didnt turn up, giving the impression that he is above law.

We have written thousands of lettersto the president, prime minister, SoniaGandhi, Rahul Gandhi, Narendra Modiand Arvind Kejriwal. Their election cam-paigns focus on unemployment. Whenthey cannot help the employed class,how can they cater to the unemployed?

Sachin Pilot asked the corporateaffairs ministry to look into the matter butwe are still awaiting any action.

Our career has been destroyed byVijay Mallya. Please highlight our plight.

Krishan Kant, via email

Who will stem the rot?

LETTER OF THE FORTNIGHT

7dle class is the most muddled up. Politicians longago concluded that this class of people only needsto be taxed, not wooed. This class will come out tovote anyways as they are educated, conscientious,care about democracy and so on. My view is that this started during the Mandal era

when reservations for the weaker class sidelined thehard-working middle class students to the extent thattoday, most students who want to study are leavingIndia for better opportunities outside. Apart from braindrain, the country is also losing out economically in abig way.

Another story in the same issue entitled Where areyou MLord is certainly an eye-opener. I was underthe impression that cases have started moving inIndian courts after all that hype over fast-track courts. If magistrates do not come on time, how arethey expected to provide timely justice to the common man?

I work with the Canadian legal system and hereattempts are being made to dispose cases as earlyas possible. Judges are always on timein fact, theysometimes have to wait for the accused, witnesses ordefense counsel. If judges themselves don't believein justice delayed is justice denied, what can beexpected of the general public. Ahem!

Neelam Batra-Verma, Vancouver, Canada

In a class of its ownThere is a dearth of good magazines on legal affairs.There are some publications but they mostly end up writing about court cases and legal matters. India Legal fills the vacuum in reporting and analysis of political-social issues by doing it with alegal perspective.

Binny Yadav, New Delhi

Please email your letters to:editor@indialegalonline.com

Or write to us at:India Legal, ENC Network,A-9, Sector 68, Gautam Buddh

Nagar, Noida (UP) - 201309

Why call it India Legal?I went through the whole magazine in detail. Congratulations on such awonderful issue. The range and selection of stories is catchy and prolific.

However, I am not sure why the magazine is named India Legal. I understand your reportage involves some legal snippets. But most of themagazines content, and indeed the best part of it, is general interest innature. By slotting this magazine in the legal space, are you not running the risk of your reader not even picking it up at the stands, thinking its a magazine for a select readership? That would be a pity forthis is a wonderful effort.

Also, I feel that the pdf version of it is not of a high quality. It is a bit difficult to read, the pictures dont look high definition and the Es look likeCs, among other issues.

Sampad Patnaik, Bangalore

Editor repliesLaw impacts almost every story we read in daily newspapers or see on television. The events that shape politics, lifestyles, social interactions, personal destinies are inextricably intertwined with the law and its vagaries.India Legal is a well-heeled mixture of regulars and special features. Theinside workings and news about the judicial system is part of the regularmenu but the magazine covers all important political, economic, corporate,and social developmentswithin the context of legal relevance.

The reason why we call our magazine India Legal is that all of the magazines stories and articles revolve on a recurring spin: they are reported, written and presented within the legal framework that drivesthem. The magazine empowers and enlightens the citizens on a variety ofissues that touch their lives. While it offers a unique inside look at the workings of the Indian legal system with journalistic panache and high production values, India Legal is by no means produced exclusively forlawyers and judges. Our magazines stories are designed to appeal to awider and sophisticated general audience of decision-makers, corporates,politicians, and the common man.

Thus, India Legal is happy in carving out a unique slot for itself. As forthe e-version of the magazine, you will soon be able to read it in a farimproved PDF format on our website.

In briefI was pleasantly surprised to read IndiaLegal. Congratulations! Clearly, in the legalbusiness, calling a spade a spade is only acontempt of court so your candor is commendable.

Ranjeev C Dubey,managing partner, N South,

Advocates, Gurgaon

Thank you for presenting legalese and making it available to us in a manner even Ican grasp.

Hilario J de Souza, via email

Superb, congratulations. It looks like yourpublication is going from strength tostrength.

Kian Ganz Publishing editor, Legally India, Mumbai

It was due to India Legal that the SunandaPushkar issue has resurfaced. I also like theQ&A pages (Is that Legal).

R Menon, Gurgaon

Its too serious a magazine for a layperson. Nitin Mathur, via email

8 April 15, 2014

In keeping silent about evil, in burying it so deep within us that no sign of it appearson the surface, we are implanting it, and it will rise up a thousand fold in the future.When we neither punish nor reproach evildoers, we are not simply protecting their trivial old age, we are thereby ripping the foundations of justice from beneath new generations.

Aleksandr Solzhenitsyn, The Gulag Archipelago: 1918-1956

VERDICT

Aruna

T he issue of the raison detre forcommuting death sentences tolife imprisonment was put to rest bythe Supreme Court recently. A peti-tion by the center to review its judg-ment on the issue was outrightlyrejected by the apex court.

The court had commuted the deathsentences of 15 convicts to lifeimprisonment on the ground ofunreasonable delay by the presidentin disposing of mercy petitions. Andlater it had even applied the samelogic to death row convicts in the

Rajiv Gandhi assassination case.The central government felt that

the time taken by the president indeciding mercy petitions of deathrow convicts cant be put to adjudica-tion before the judiciary.

A bench of Chief Justice P Sathasivam and Justices RanjanGogoi and Shiva Kirti Singh rejectedthe petition, finding it baseless. Thiswould dash centers hope thatGandhi convicts, Murugan, Santhanand Perarivalan, can still be sent tothe gallows.

Death is not the solution

10 April 15, 2014

SUPREME COURT

Illustrations: Aruna

It is not uncommon to findpoliticians in India hurlinghate speeches to garner voters,especially during election cam-paigns. Now the Supreme Courthas not only taken cognizance ofthe need for a clampdown onhate speech by parties at all

times, and not just during theelections model code of conductphase. It has also asked forremoving any confusion on whatconstitutes hate speech so thatit doesnt infringe on the right tofree speech and expression.Responding to a petition filed

by NGO Pravasi BhalaiSangathan, a bench led by

Justice BS Chauhan askedthe Law Commissionwhether it felt appropriateto define hate speech.

The court pointed outthat although therewere enough legal pro-

visions to curb hatespeech, the existinglaws were not beingenforced properly.

If the commissiondefines hate speech, EC

can take action against politicalparties even if there is no modelcode of conduct in place.

I f you think you can kill somebody after guz-zling liquor and yet get a clean chit from thecourts after claiming that you were drunk, you aremistaken. The Supreme Court has categoricallymentioned that intoxication cant be the reasonfor reducing the gravity of a criminal offense.Dismissing an appeal by Bhagwan Tukaram

Dange that he had unintentionally lit a matchstickand set fire to the saree of his wife under the influ-ence of liquor after his father sprinkled keroseneon her, a bench of Justices KS Radhakrishnan andVikramajit Sen ruled that Dange, even if he wascompletely drunk, was expected to be aware ofconsequences of his action, and the court had no

reason to interfere withthe sentence deliveredby lower court. Earlier, the trial court

in Maharashtra hadsentenced Dange forlife for burning his wifeto death. This judgmentwas later upheld by theBombay High Court.Dange has now served16 years in jail.

No room for hatespeeches

Inebriation nocause for mercy

11April 15, 2014

Is it apt to ignore the victim whilegiving a compensation packageand hand it out to her mother on theground that the victim is illiterate andthus not capable enough to handle themoney? Can this be doneeven if the victim is a 20-year-old adult?A bench of Chief Justice

P Sathasivam andJustices SA Bobde andNV Ramana raised theissue while initiating suomoto proceedings in acase where the WestBengal government hadmade a compensationpackage to the mother ofa tribal girl who wasgangraped by 13 peopleas per the directions of avillage headman, fordaring to choose a lifepartner. The compensa-tion package included

`50,000 to the rape survivors mother,widow pension to her, rebuilding ofthe house damaged by the mob, con-struction of a toilet, and a tubewell.The apex court pointed out several

loopholes, such as whywas the compensationgiven to the motherwhen she was not enti-tled to it, was the motherliterate enough to man-age the money, and if itwas a case of largessedoled out by the WestBengal government.While reserving its

judgement, the benchsaid it was also exploringthe legal possibility ofthe accused paying thecompensation packageand wanted to knowwhether the tax payersshould be burdened forsomeone elses crime.

Ranbaxy Laboratories, a world-reputed drug company, recentlycaught the attention of the SupremeCourt. In a public interest litigation(PIL), advocate ML Sharma accusedthe pharmaceutical company of sup-

plying adulterated drugs. Citing aninstance where the company wasfined $500 mn by the US Food andDrug Administration for supplyingspurious drugs in that country, thePIL pleaded that Ranbaxys license be

cancelled. It blamed the centerfor turning a blind eye and

drug regulator Central DrugStandards Control Organisation

for allowing the company to sell drugsin India despite Ranbaxy being foundguilty in the US.

A bench headed by Chief Justice P Sathasivam, however, refrainedfrom issuing an interim order thatwould have stopped the companyfrom manufacturing drugs.

Nobody would, probably, ques-tion the death penalty awardedby the trial court and later upheld bythe Delhi High Court to Nirbhayaconvicts. But by some strange quirkof fate, two of the death row convictsgot a reprieve from the highest courtof the land.The Supreme Court recently stayed

the high court judgment to confirmdeath penalty to Mukesh and PawanKumar Gupta in a special sitting afterMukesh claimed he was armtwistedby the police into accepting a lawyerVK Anand during the trial, ratherthan the one he had already engaged.The petition filed by their counselML Sharma said that the trial was,therefore, unfair.

Both Sharma and Anand have beenengaged in a legal tussle over appear-ing for Mukesh ever since theNirbhaya trial started in January2013. Sharma had filed a petition inthe Supreme Court to transfer thecase from Delhi to Mathura on theground that the trial was being influ-enced by negative public glare andmedia coverage. However, Anandraised an objection that Sharma hadnot been empowered by Mukesh torepresent him in the case. The apex court had rejected

Sharmas appeal based on a report bya senior subordinate judge, whichstated that Mukesh wanted Anand toserve as his lawyer in the trial courtas well as the transfer petition, andnot Sharma.However, after the high court ver-

dict, Mukesh had availed the servicesof Sharma to fight his case as counselin the Supreme Court.

Medicine muddle Nirbhayacase hangsin balance

Compensation woes

while changes in the companies act may usher in

transparency, they are noviable substitutes for tightervigilance by regulators. new

laws cannot prevent Sahara-Satyam type

corporate scamstwo sides ofthe same tarnished

business coinBy Alam Srinivas

T was a surreal meeting in the early 2000s.Years before he was arrested, Ramalinga Rajuof Satyam Computer said he wanted to becomea global thought leader like Bill Gates and JackWelch. As he built castles in the air about hisfuture, he showed me his latest purchase. It wasa telescope in his balcony, which he used to

scan the night sky. He talked about integrity, transpa-rency, honesty, and respect. He turned out to be a blackdwarf; a star that had burnt out its lights.

A few years later, I chased Subrata Roy, chairman andmanaging worker, Sahara Group, in Lucknow. Known forhobnobbing with global and Indian celebrities andactresses, he hadnt been seen for months. Rumors werethat he had a serious disease. Most of the dozens of peopleI met hated Saharasri, as he was called by his employees.He ran a byzantine empire cloaked in an opaque veil.

GREAT FALL: Arrests of Sahara Chairman Subrata Roy in February 2014 and of Satyam Computer Chairman Ramalinga Raju in early 2009

CORPORATE / companies act/sahara and satyam

12

ISUBRATA-DUM

Anil Shakya

protect the small investors in both listed andunlisted firms, and to make sure that theindependent directors, auditors, ratingagencies, and institutional investors didtheir jobs. Simultaneously, the governmenthad to give more teeth to its barking dog,SEBI, and additional powers to go after cor-porate conmen like Roy and Raju.

The end result: The amended CompaniesAct of 2013. The act had several clauses,whose aim was to prevent corporate frauds.Amongst ourselves, we call it the Roy &Raju Act; almost all its changes are anattempt to prevent such manipulations,says Prithvi Haldea, the founder of PrimeDatabase. He adds that theoretically: The new act is stronger, asks for more

Recently, he found himself in Tihar Jail,thanks to SEBI and the Supreme Court.

Both Roy and Raju seemed like two sidesof the same tarnished corporate coin.Satyam was a publicly-listed company, whi-ch won awards for corporate governance.But it turned out to be a sham, as it cookedup its balance sheet and financesa $2.7-billion fraud.

Sahara was an unlisted group, and out ofSEBIs ambit. Yet it was the market regula-tor, which exposed its `24,000 cr nefariousactivities that included bogus investors andunaccounted money.

No doubt the country required changesin the Companies Act to prevent, or at leastcurb, such scandals. It was paramount to

13April 15, 2014

& RAJU-DEE

Getty Images

which was not legally monitored by SEBI.OFCDs are different from fully-, partially-and non-convertible debentures.

Both were unlisted companies, i.e. theywere not traded on stock exchanges and,therefore, did not come under SEBIspurview. They were ruled by the oldCompanies Act. In their prospectuses, filedwith ministry of corporate affairs, theyclaimed that they did not wish to get listedat any stage. Their lawyers maintained thatan offer of shares or debentures to morethan 50 persons does not automaticallymake it a public issue or private offer, bothof which are governed by SEBI.

disclosures by companies and promoters,and can prove to be good for both the retailand institutional investors.

PUBLIC-PRIVATE DEPOSITSTwo of Sahara Group firms, Sahara IndiaReal Estate Corporation and SaharaHousing Investment Corporation, togethermopped up over `24,000 cr from three mil-lion investors. Every precaution was takento skirt SEBI rules and laws.

The instrument was optionally fully con-vertible debenture (OFCD) which, as per thethen regulators definition, was neither equity nor debt. It was a hybrid instrument,

CORPORATE / companies act/ sahara and satyam

14 April 15, 2014

Corporate frauds Independent directors sidedwith owners; behaved like rubber stamps Pyramidal maze of firmswhere top firm controlled thosein several tiers External auditors ignored redflags; were paid extra and hiredfor almost a decade Boards openly cleared related party deals that helpedthe promoters

Directors to be appointedfrom an official database; onewomen director mandatory

Curbs on the number of tiersof subsidiaries that can be controlled by a holding firm

Compulsory rotation of external auditors for both listedand unlisted companies

Related party deals to becleared by both the board and shareholders

2013 amendments

Anil Shakya

Most importantly, the group said theOFCDs were sold only to people who wereapproached privately (and not in a publicmanner through advertisements), and asso-ciated or connected with the Sahara Group.So, by no stretch of imagination was it apublic issue. Hundreds of thousands ofSaharas agents went to potential investors,who were part of the group in some form, toraise the money.

The Supreme Court ruled in August 2012that Saharas OFCDs could be regulated bySEBI. Since the two firms did not adhere tothe regulators rules, they had to return theentire amount to their investors. In case ofKolkata-based Saradha Group, its agentsraised over `1,000 cr from lakhs of individ-uals. It operated a typical ponzi scheme, andSEBI asked it to return the money too.

The 2013 Companies Act imposed strin-gent norms on companies keen to raise pub-lic deposits. Only banking firms, non-bank-ing financial companies, certain public enti-ties and those prescribed by the governmentare now allowed to accept deposits.

Public firms can do it only if they got acredit rating and put their assets as collater-al against the deposits. In case of defaults,the regulator could immediately attach andsell these assets to pay depositors.

However, one has to see how these lawsare implemented. Ironically, SEBIscase against Sahara, which was required tostop Roys corporate shenanigans, actedagainst the interests of the small sharehold-ers. One of the allegations against Saharawas that there were no genuine investorsinvolved in the OFCDs. The majority ofthem were benami and non-existent; it waspossibly black money that was launderedthrough the debentures.

If this was indeed true, wasnt SEBI bark-ing up the wrong tree? Isnt it the regulatorsresponsibility to dig into corporate irregu-larities where genuine shareholders areinvolved? Why did SEBI spend over `60 crin the last fiscal for digitization and scan ofSahara documents related to investors,refund-related activities, legal costs and in-house expenses? The regulator has tolook at the interests of the minority share-

holders in listed companies first, and goafter unlisted firms later.

According to a 2010 paper, IndiasSatyam Accounting Scandal by DavidWinkler of University of Iowa College, Theownership structure of Indian businessescontributed to the Satyam scandal. Thepyramid structures in most family-run andother businesses permits groups to controlmore of the operations than their equityclaims represent. Winkler noted that in the1990s, almost a third of Indian businesseshad pyramidal hierarchies in place.

PYRAMIDAL MAZE OF FIRMSThis is how it works. The promoters own 51percent of the top company, which holds 51percent in second-tier firms which, in turn,control 51 percent in the third-tier compa-nies. Thus, the owners have complete con-trol over all the tiers, even though their realfinancial commitment in the second tier is26 percent (51 percent of 51 percent), andstakes in the third tier are only 13 percent.

Winkler concluded that such structuresallowed business families to benefit them-selves and harm small shareholders, tunnelcorporate gains and funds from one entity toothers, and make it difficult for outsiders toknow how all the business have performed.

Under the new clauses, the layers of sub-sidiaries (Tier-1, Tier-II and Tier-III) of aholding company in any group are restricted.A firm will be deemed to be a subsidiary of aholding company if the latter, along withother subsidiaries, controls over 50 percentof the formers share capital. Even if the hold-ing company has the power to appoint and remove the majority of directors in anentity, the latter will be dubbed as a sub-sidiary of the former.

But what happens if two holding compa-nies, along with their layers of

Amongst ourselves, we call itthe Roy & Raju Act; almost all its

changes are an attempt to prevent such manipulations.

Prithvi Haldea, the founder of Prime Database

15April 15, 2014

subsidiaries, are owned by different familymembers? And the holding firms and sub-sidiaries have cross-ownership linkagesbetween them. Will the regulators decidethat Tata Group and Cyrus Mistry Group areinter-related because Cyrus Mistry is chair-man of the former?

DEPENDENT DIRECTORSJP Sharma, professor at Delhi School ofEconomics, did an extensive study onSatyam. He concluded: Satyam Board wascomposed of chairman-friendly directors,who failed to question managements strate-gy. This was despite the fact that six out ofnine directors were independent, and

included names such as Krishna Palepu, aHarvard Business School professor,Mangalam Srinivasan, a US academician,and Vinod Dham, known as father of thePentium chip.

One of the major charges against Rajuwas his decision in December 2008 tomerge Maytas Infra and Maytas Properties,owned majorly by him and family, withSatyam. The combined acquisition tag: $1.6billion. Sharma found that seven of the ninedirectorsthe two promoter directorsexcused themselves from the board meetingbecause of conflict of interesttook a unan-imous decision on the M&As. It was onlywhen most of the shareholders rejected thedeals, and Satyams stock tanked that theboard overturned it. But it was too late, andit triggered Rajus fall.

In his piece, What Went Wrong WithSatyam, Sharma said: This naturally causessuspicion on the role performed by the inde-pendent directors present in that meeting.

CORPORATE/ companies act/ sahara and satyam

16 April 15, 2014

Under the new Act, independent direc-tors have to be selected from a databank, which will be maintained by a notified institute or association. No indi-vidual can be a director in more than 20firms; earlier, people were on board ofdozens of firms.

Independent directors cannot receivestock options, but can be compensated

New disclosure laws

In Satyams case, the independent directors allied themselves with the

interests of the promoters. And auditorsfailed to react despite red financial flags.

by sitting fees and reimbursement of otherexpenses such as travel and stay toattend board meetings. The 2013 act stat-ed that directors, except managing direc-tors, cannot receive any loan or guarantee from a firm on whose boardthey serve.

To reduce related-party transactions,like the one between Satyam and the twoMaytas firms, the 2013 amendmentsmade it mandatory for a companys boardand shareholders to approve such deals.They need to be disclosed in the annualreports under Directors Report. The inter-est rates on loans given to related partiescannot be lower than the rates on govern-ment securities.

The flip side is that there are severalways promoters can siphon off moneywithout going through the related-partyroute. Normally, loans are given to relatedparties at ridiculously low or zero interest,and the money is never returned. But whatif the owners inflate invoices of their ven-dors, and ask the latter to pay the differ-ence in cash or to another company,which raises a bogus bill?

GLOSSING OVERCORRUPTION?(L-R) Krishna Palepu ofHarvard Business Schooland Vinod Dham, entrepreneur and venturecapitalist, who were onboard of Satyam whenRaju perpetrated the fraud

17April 15, 2014

IL

What concerns everyone is that those inde-pendent directors allowed themselves to beparty to the mysterious designs of the pro-moter directors. It is hard to believe thatsuch eminent and experienced personalitiescould not discover the well-planned massivefraud and manipulations. Therefore, thenew amendments try to make the inde-pendent directors more accountable, andtheir decisions more transparent (see box).

UNACCOUNTABLE AUDITORSIn May 2012, Reebok India accused its sen-ior managers, including MD and CFO, ofsetting up secret warehouses to steal prod-ucts, fudging the accounts and faking sales.The global parent estimated the loss to be`870 cr, although the Serious FraudInvestigation Office found evidence of falsi-fied documents worth `500 cr. The Satyamcase was bigger; Rajus culinary skillshelped him to cook all kinds of figures in hisannual and quarterly balance sheets.

For instance, in its September 2008quarter, Satyam showed cash and bank bal-ances as over `5,300 cr; the actual figurewas less than `500 cr. The interest (almost`400 cr) it claimed to earn from these bankbalances did not accrue to the company.Unsecured loans to others were shown asless than `250 cr; the actual figure wasalmost `1,500 cr. After his arrest, Rajuadmitted that his firm overstated incomeand profits each quarter for several years.

According to Winkler, The resultsannounced on October 17, 2009, overstatedquarterly revenues by 75 percent and profitsby 97 percent. Satyams head of internalaudit raised fake invoices to inflate income.Over 6,000 benami salary accounts werecreated to give an impression that the com-pany was growing. Clearly, the externalauditors, Price Waterhouse Coopers (PWC),failed in its responsibilities despite severalred financial flags. First, PWC should havequestioned why the company kept hugecash in non-interest deposits. Any sane CFOwould have earned some income on it.Second, the external auditors should havechecked at least some of the purported bankaccounts, in which the company claimed

deposits. Third, PWC could not uncover thescam for nine years (2000-09), whileMerrill Lynch, which was hired by Satyam inDecember 2008, discovered it in 10 days.

Under the new act, external auditors haveto be rotated at regular intervals, and theycannot provide other services like invest-ment advisory and financial informationsystems to the firm, its holding company,and subsidiaries. This is aimed to ensure theindependence of the external auditors,which cannot be wooed by other incentives.

Yet again, the rotation of auditors is notthe cure. If an audit firm like PWC can sleepon its job, and if the promoters are hell-bentto hide facts, corporate frauds will continue.The owners can find different ways to incen-tivize auditors to close their eyes; Satyampaid PWC twice the amounts companies payto other external auditors.

A Delhi-based corporate lawyer explains:In October 2008, World Bank banned thefirm for eight years due to allegations ofspying; the same month, an analyst ques-tioned the huge cash balances, which did notearn any interest. If SEBI was alert, it couldhave caught Raju.

Since our laws are reactive, as is the casewith 2013 Companies Act, corporate ownersare always several steps ahead of the lawmakers and regulators.

HALL OF FAME, ANDINFAMY

Reebok India ManagingDirector Subhinder Singh

(fourth from left), whowas charged with a

`870 cr fraud, duringhappier times; here he

poses with Indian cricketers after theteams World Cup

victory in 2011

Getty Images

ARMS AND THEMURKY MAN

he owns luxury hotels and manages charities. but sudhir choudhriesreal work is to act as a fixer of super deals

SPECIAL REPORT/ defense agents / the choudhries

18

Illustration: Anthony Lawrence

N 2009, just after the globalfinancial crisis of 2008, aLondon-based investmentcompany, C&C Alpha Group(CCAG), made an audaciousannouncement. It launched achain of luxury boutiquehotels, Nira Hotels & Resorts,to cater to the rich and famousacross the world. The first two

properties it announced were Nira Diwa inManila, the Philippines, and Nira Lahari inKerala, India. While Nira Diwa offered anexclusive urban retreat blending old-worldcharm with contemporary sophistication,Nira Lahari was located along the pictur-esque Vembanad Lake. As expected, itevoked gasps and the right kind of buzz.

It was the kind of reaction the companydesired. It was a relatively new group thatstarted in 2002, its owners were relativelyunknown and people were unaware aboutthe sources of the companys cash flow.

But then, CCAG was not an ordinarycompany. Its net worth today is `248.5 cr(24,504,214). And it was headed by the 35-year-old Indian-born, Boston-educated,British national, Bhanu Choudhrie, his elderbrother Dhairya and cousin Dhruv. Nothingexceptional about this, except that Bhanu andDhairya are sons of Sudhir Choudhrie, one ofIndias biggest arms dealers. The authoritiesin the UK became suspicious of the groupsactivities and its directors, who did not seemto have any credible sources of income tomatch their lavish lifestyles and charities.

COVER BLOWNSudhirs defense-related businesses came tolight when the UK Serious FraudInvestigation Office probed corruptioncharges against iconic UK engine-makersRolls Royce. It found evidence in Februarythis year that Sudhir and his younger son,Bhanu, facilitated Rolls Royce deals inChina and Indonesia. The findings hadrepercussions in India.

The residences and offices of theChoudhries in the UK were raided andSudhir and Bhanu were arrested there.Under pressure, Indias defense minister,

AK Anthony put all Rolls Royce contractsunder hold until the investigations on themwere over. He asked the Central Bureau ofinvestigation (CBI) to probe the purchase ofengines for 123 Hawk fighter jets in 2004.The deal was worth `10,000 cr, andinvolved `500 cr kickbacks to Indianagents. The CBI has registered a prelimi-nary inquiry to probe the case. TheChoudhries are out on bail in the UK and aspokesperson for the duo denied anywrongdoing, adding they are cooperatingfully with the investigation.

Anthony was under pressure when ques-tions were raised on the purchases of VVIPhelicopters and Tatra trucks. The RollsRoyce charges, barely two months beforethe national elections, was the last thingthat UPA-II needed, embroiled as it was inother corruption charges.

The defense ministry, along with state-owned Hindustan Aeronautics Ltd (HAL),is Rolls Royces largest customer; almost3,000 Rolls Royce engines are fitted in vari-ous air force planes. India is the biggest

19April 15, 2014

Shanti Prasad Choudhrie

The Choudhriesfamily tree

Sudhir Choudhrie

Karinawife

DhairyaBhanu

The Choudhries masquerade their defenseinterests by generous charity work. They

honored Malala Yousafzai of Pakistan at arecent leadership event.

ISimrinwife

wifeAnita

Simran

Amrit Choudhrie

wifeshylla

Dhruv

wifeRita

Late Rajiv Choudhrie

middlemen. Sudhirs connection with HALis old and well-established, says a retiredwing commander. So is Rolls Royces connection with HAL. It is an open secretthat Sudhir is involved in several IAF pur-chases. While the HAL-Rolls Royce rela-tionship goes back to the mid-50s, Sudhirsconnection with HAL can be traced back tothe 70s and 80s.

THE BEGINNINGSIt started when Baljit Kapoor, who wasSudhirs uncle, became HAL chairman inthe 80s. Baljit was close to Indira GandhisPMO, which allegedly helped him to grabthe post, says a source. He adds: Baljitmentored Sudhir by providing him foreignbusiness contacts and helped cultivate relationships with powerful Punjabi politi-cal leaders, bureaucrats and the business-men in the capital.

Sudhir started his forays as an arms deal-er in the 70s along with two Delhi-basedmiddlemen, retired Vice Admiral SM Nandaand his son, Suresh Nanda. They floated acompany, Eureka, with an office in DelhisDefence Colony. The first major deal theywere involved in was the purchase of theFrench Matra missiles for the IAF.

Later, Sudhir started his company,Magnum International Trading CompanyLimited (MITCO), which publicly was intotea exports. However MITCOs work wasexposed after the CBI probe in 2006 into

arms purchaser in South Asia and the sec-ond in the world, after the US. Its no won-der, then, that foreign suppliers are willingto pay a commission of up to 10 percent tomiddlemen to facilitate the deals.

Sudhir is not unknown to the ministry ofdefense. He was already on the watch-list of

HDW Scam, (mid-1980s):This was the first time theNandas family figured indefense corruption. It wasalleged that the retired ViceNavy Chief SM Nanda andhis son Suresh acted asmiddlemen in the pur-chase of `400 cr sub-marines from Germancompany, HDW(Howaldswerske). Status: Case closed.

Bofors scam (1987):Former prime minister,Rajiv Gandhi was allegedto have received `64 cr forthe 155-mm howitzers purchase from Swedishfirm Bofors. OttavioQuattrocchi, who wasclose to the family of RajivGandhi, acted as a mid-dleman for the $1.3 billiondeal for 400 guns.

Status: Delhi High Courtacquitted the accused.

Coffin scam (1999):During the 1999 Kargil war,CBI filed a case against aUS contractor and seniorarmy officers for the pur-chase of coffins. DefenseMinister George Fernandeswas accused. Status: Case pending.

Tehelka scam (1999):An online news portalrevealed how army officersand political leaders wereinvolved in taking bribes

during arms deals. Thesting showed that bribeswere paid in at least 15deals, including the Barakmissile case. Status: Case pending.

Scorpene deal (2005):It was alleged that theScorpene submarinesmanufacturer Thales paid`500 cr to middlemen to

secure the contract. TheCBI, however, found noevidence of corruption inthe deal in 2008. Scorpenesubmarines are now beingbuilt in India under a tech-nology transfer agreementthat was part of that contract. Status: Case closed.

Barak missile scam(2006):The first case in whichSudhir Choudhrie wasnamed. CBI had registeredan FIR in 2006, but did not name Sudhir as an

List of defense corruption scandalssince Bofors

20

T-72 Tank 1,500 900BMP 2 APC (infantry combat vehicle) 1,600 640UAV-HERON (unmanned air vehicle) 220T 90 Tank 310 825M 46-130 upgunning (towed field gun) 180 48 T 90 Tank 347 1,051Long Range Surface-to-Air-Missile 2,500MI-17 V5 (helicopter) 108 565MIG 29 K (fighter plane) 29 2,250Quick Reaction Surface-to-Air-Missile 1,600Ammunition-SMERSH (for rocket launcher) 364Ammunition T 72 (ammunition for tank) 178SU 30 (Sukhoi fighter plane) 140 2,240SU 30 MKI (Sukhoi fighter bomber plane) 80 1,600Fifth Generation Fighter Aircraft 214 20,000Low Level Quick Reaction Missile System 2,445INVAR T 90 Missile (for T-90 tank) 10,000 400INVAR T 90 Missile 15,000 480T 72 Power Pack Upgrade (upgradation of tanks) 1,000 700BMP 2 Power Pack Upgrade (infantry combat vehicle) 1,362 470SU 30 Upgrade 140 847UAV-HERON upgrade 72KA 28 MLU (helicopter) 11 120T 90 Tank 600 2,400

200020002002200420042007200920102010201120122012201220122012201220132013201320132013201320132014

Year Army QuantityValue

($ million)

Indias suspected defense deals

SPECIAL REPORT/ defense agents / the choudhries

the `1,125 cr Barak missiles deal. The mis-siles were purchased from Israel AircraftIndustries (IAI), and CBIs FIR revealedthat kickbacks were routed throughMITCO. On October 10, 2006, the CBI raid-ed the residences of Suresh Nanda, ArvindKhanna, his son Vipin Khanna and SudhirChoudhrie. A few hours before the raid,Sudhir escaped abroad. When CBI sleuthsreached his residence in Sundar Nagar inDelhi, they found that he had taken a flightto London the previous night. Was he tippedoff or just plain lucky? No one knew. But itshowed his possible clout and connectionsin the highest echelons of the land. InDecember 2013, the CBI filed closure reportand said its probe could not find any evi-dences of wrong-doings.

But this is not the first case that the CBIhad closed against Sudhir, citing similarlack of evidences. In 2007, the CBI filed anFIR against Sudhir in the purchase of faultySoltam guns (worth over `208 cr) from anIsraeli company. He, along with the thenSamata Party treasurer, RK Jain and otherdefense officials, were booked under corrup-tion charges. In 2010, the agency filed a closure in the case, which was accepted bythe court in 2011.

Fortunately, the success of the Barak andSoltam deals, according to Israeli newspa-per Haaretz, heightened Sudhirs reputa-tion. IAI later sold unmanned aerial vehiclesto India. Then followed the sale of attack

drones called Green Pine, radars used by theArrow anti-ballistic missile system and fourAWACS-type aircraft equipped with thePhalcon radar system. Today, Israel is nextto Russia among Indias arms suppliers.With annual purchases from Israeli compa-nies touching $3-4 billion, one can calculatethe amount of money made in commis-sions, reveals a defense ministry source.

INROADS INTO UKIt was the Russians who initially spottedSudhirs network. He worked with Russiangovernment-owned companies, which weremajor suppliers of arms during the ColdWar. Later, when USSR disintegrated, thegovernment started privatizing defensebusinesses. Sudhir was smart enough to buystakes in some of these companies. One wasSukhoi, which manufactured fighter jets,and where he was allegedly a part owner.

The CBI raid in 2006 became a turningpoint in Sudhirs life. He knew his return toIndia was tough. He feared that a CBIchargesheet and trial could force the UK toextradite him. Besides, he was unsure

accused.Status: The CBI filed clo-sure report.

Soltam Gun scam(2007):In the FIR, CBI hadaccused the Israeli firm

Soltam of paying bribes to,among others, Sudhir. Status: Case closed.

Sudipta Ghosh case(2009):The former OrdnanceFactory Board directorgeneral, Sudipta Ghoshwas arrested by the CBIfor taking bribes from twoIndian and four foreign

companies blacklisted byministry of defense. Status: Case pending.

Tatra Trucks deal(2012):The then army chief, VKSingh (now BJP partymember and Lok Sabhacandidate from Ghaziabadconstituency) blew the lidoff the scam in purchaseof over 7,000 Tatra trucks.In the past 25 years over ` 5,000 cr have beenspent on the purchases.The CBI registered FIRagainst London-based

defense dealer Ravi Rishiand several other officials. Status: CBI probe continues.

VVIP Helicopters deal(2013):In January 2014, Indiacancelled the `3,600-crorecontract for 12 helicopterswith the UK-based AgustaWestland. In February2013, reports had sur-faced alleging that two topofficials of Agusta

Westland's Italian parent,Finmeccanica, had paidbribes.Status: Probe on.

HAL-Rolls Royce enginedeal (2014):The UK SFIO in Februarythis year raided and arrest-ed Sudhir and his sonBhanu on allegations ofacting as a middlemenfor sales of Rolls Royceengines to Indonesia andChina. The ministry hand-ed over the matter to CBI. Status: CBI yet to beginprobe.

Foraying into arms deals in the 70s withretired Vice Admiral SM Nanda,

Choudhrie first cracked a big deal withFrench Matra missiles for the IAF.

21April 15, 2014

how to continue with his consultancy busi-ness (middlemen), while being abroad.

Old associates of Sudhir reveal that heused his Indian experience to make inroadsinto the UK political circles. British newspa-pers reported that he was the top donor forthe Liberal Democrats Party: amounts rang-ing from 50,000 (approx `50 lakh) to20,000 (`20 lakh). Two companies con-trolled by Sudhirs son, Bhanu, and nephewDhruvAlpha Healthcare and C&CBusiness Solutionsdonated an additional4,75,000 in the UK.

From October 2006 to January 2011,Sudhir remained in London. He used it tohis advantage. He put his money into legiti-mate businesses across the globe. The 2009economic recession was a blessing in dis-guise for fresh investments. In 2008 and2009, his sons CCAG group floated severalnew companies dealing in real estate, hotels,shopping malls, among others. Sudhirreturned to India in 2011 after the CBI gavehim a clean chit in the Soltam gun probedue to lack of evidence. The reclusive busi-

nessman stepped into the public gaze. Hiscompanies orchestrated a PR campaign toimprove his image. Recently, in their com-pany-sponsored GG2 Leadership event inthe UK, Dhairya gave an award to MalalaYousafzai, the celebrated Pakistani teenagerwho was attacked by the Taliban.

NEW AVATARFor decades, Sudhir and his family havetried to cloak their defense activities withlegitimate businesses. In 1995, Sudhir wason board of a joint venture, which involvedTata Groups Taj Group of Hotels. Duringthe late 1990s and early 2000s, he was anon-executive director in ebookers Plc, anonline tourism and travel website, whichhas now changed ownership. He was also adirector in Adidas venture in India.

His son, Bhanu, who is a collector ofAsian art and promotes it, also runs a char-ity called Path to Success, which works withdisabled and disadvantaged children. Hemanages the groups flagship, ShantiHospitality Group, which includes boutiquehotels, spas and beach, plantation and golfresorts across the world. Shanti Maurice, aluxury resort in Mauritius, was the winnerof the World Luxury Spa Award in 2012.

According to a newspaper article, Bhanuadvises and sources deals in emerging mar-kets, such as India, Russia and South-EastAsia and assists individuals to incubateand grow their businesses and maximizebusiness potential. He has interests in hos-pitals and healthcare; the group owns 13care homes with over 600 beds in Midlandsand southeast regions in the UK.

The Sudhir familys renowned invest-ments in India are in Ananda Spa, located atthe foothills of the Himalayas. IHHRHospitality Pvt Ltd has five star propertiesin Bangalore, Hyderabad, Amritsar andPune. Each five star, according to industryexperts, incurs an investment of at least`200-300 cr for construction, or a cumula-tive cost of over `1,000 cr.

But with the Rolls Royce controversy,Sudhirs image has taken a beating. Still, it will be a huge task for Indian and the UKinvestigators to piece together the pieces inthis jigsaw puzzle.

SPECIAL REPORT/ defense agent / the choudhries

IL

Mid-1980s: Following the Bofors scandal, Rajiv Gandhi declared a banon middlemen.

1989: The ministry of defense issued guidelines to regulate agentsthrough registration and monitoring.

1999: The then defense minister George Fernandes reinforced the banon agents, and ordered an inquiry into military purchases, includingspares acquired since 1985.

2001: Fernandes asked Central Vigilance Commission (CVC) to examineways to reduce middlemen. The CVC recommended legalization ofagents, by registration to inculcate transparency and efficiency. It result-ed in ambiguous and contradictory guidelines of recording the agentscontractual, banking and financial details. Over the past 13 years, not asingle agent has registered with the ministry of defense.

2006: Defense Procurement Policy (2006) banned agents/middlemen.Made it mandatory for suppliers to sign pre-contract integrity pacts underwhich they unequivocally confirm that no individual or firm wasemployed to facilitate the deal.

2006-14: The ministry of defense continues with the policy of ban on the role of middlemen and signing of integrity pact. It blacklisted firms alleged to be involved in corruption cases, and banned seven foreign companies.

Meddling policies

22 April 15, 2014

here does the buck stop?One could ask this ques-

tion after navy chief,Admiral Devendra Kumar

Joshi resigned almost 18months before his retirement

was due, taking moral responsi-bility for the recent accidents

which took place in various sub-marines and warships, resulting in the loss of many lives.Most defense experts feel that it is the civilian bureau-cracy, i.e. the Ministry of Defense (MoD) headed by AKAntony which should be held accountable. After all, itcontrols the defense budget.

In the recent past, the navy has possibly suffered themost in terms of annual budgets and expenditure onmodernization. Going by the expenditure on the three

23April 15, 2014

PROBE/navy accidents

POSTMORTEM TIMEFormer chief of naval

staff, Admiral DKJoshi briefing Defense

Minister AK Antonyabout the explosion

on INS Sindhurakshaksubmarine in August 2013

WATERCOFFINS

aged vessels, lack of accountability, low budgets and delays in repairs have

turned the naval fleet into death vesselsBy Vishwas Kumar

PIB

24 April 15, 2014

present schedule. The 2012 deadline has gone and the

French-manufactured Scorpene submarineswill be ready only in 2016. What does thenavy plan to do in the interim?

This procrastination on the part of MoDhas serious consequences. Retired ColonelAjit Bhinders twitter (@ajitbhinder) com-ment on the present situation is apt. Hewrote: Admiral Joshi did the right thing byresigning. Today no chief Army/Navy/AFcan get anything done fr (for) their com-mands because of Neta/babu/MoD.

The area where the navy needs resuscita-tion is refits and repairs. Any delay canaffect safety, warn experts. The 2008 CAGreport said: The refit activity managementin the Navy was not efficient as 83 percent ofshort refits and 100 percent of normal andmedium refits were delayed and could notbe completed within the prescribed timeperiod. It added that the average opera-tional availability of the submarines was aslow as 48 percent. This issue assumes signif-icance in the light of 20 sailors reportedly

The defense secretary has beenassigned authority for the defense ofIndia. However, he has zero accountability... when things go wrong.

Arun Prakash, former navy chief

forces in 2013-14, the share of the navy wasthe lowest (18 percent) compared to army(49 percent) and air force (28 percent). Incomparison to the previous fiscal year(2012-13), the navys share declined by 1.4percent.

It fared worse in 2012-13, when the budg-ets of all the three wings of the armed forceswere slashed drastically. However, the cut inthe navys revised budgets was the highest,compared to the other two forces. Thisbudget was reduced by almost 27 percent,while the respective figures for army and airforce were 16 percent and 0.25 percent.

The various CAG reports (1999, 2008 and2013) show the inertia and lack of concernthe ministry displayed towards those guard-ing Indias maritime borders. Its a tragicsaga of neglect and inefficiencyaged ves-sels, shortage of staff, increased work-load,lack of spare parts and delays in repairs andrefits. Its bad enough that these have affect-ed the operational efficiency of warships,but now, they have led to loss of lives. Thesituation is so grim that navy insiders calltheir ships death vessels, similar to airforce MiGs referred to as flying coffins dueto their frequent crashes.

AGEING FLEETWarnings about the navys dire straits werevisible. In 2008, CAG warned: With seriousslippages in the induction plan, the navy isleft with an ageing fleet with more than 50percent of submarines having completed 75percent of their operational life and somealready outlived their maximum service life.The report added: If the construction planfor new submarines is not expedited, 63 per-cent of the existing fleet would completetheir prescribed life by 2012 when the firstnew submarines will be inducted as per the

PROBE/navy accidents

25April 15, 2014

dying during a fire in the two Russian-madesubmarines, INS Sindhurakshak and INSSindhuratna, which underwent refits andrepairs.

FINANCIAL CRUNCH The root cause of the problems is the lack offinances. Given the fleet size the repair loadis huge. The repair and maintenance worktakes months to complete. On top of that,there is lack of availability of spare parts andmanpower in dockyards.

Former navy chief Arun Prakash told amagazine: The chiefs carry full responsibil-ity for their serviceoperational andadministrativebut they have no locus-standi in the MoD. The defense secretary, onthe other hand, has been assigned authorityfor the defense of India and for the threearmed forces HQs. However, he has zeroaccountability for anything, especially whenthings go wrong.

The sorry state of affairs in the MoD wasrevealed when CAG did another audit inDecember 2013 called performance audit

on repairs and refits. It covered the periodbetween 2005-06 and 2009-10 and revisit-ed its 1999 conclusions. Incidentally, thisperiod covers the tenure of Antony whoassumed office in October 2006.

This audit exposed the grave risk not onlyto submarines, but also to surface warships(corvettes, destroyers, frigates, etc), whichsuffered from similar self-inflicted prob-lems. The auditors recorded their disap-pointment with the MoD for not acting ontheir previous findings: We observed thateven after a decade, the Navy has cited thatno perceptible improvement has taken placein timely completion of refits. Resultantly,8,629 ship days were not available for mar-itime operational purposes, due to availingexcess days for completion of refits.

DELAYED REFITSThe audit statistics are disturbing. Morethan 50 percent of warships (surface) inservice are beyond 20 years of age. In morethan 82 percent of warships, refits andrepairs have been delayed up to and beyondthe 300 mandated days. The main factorcontributing to delay in completion of

TESTING TIMESSurface-to-surface

missile firing exerciseunderway

In 2013-14, the budgetary share of navywas the lowest (18 percent) compared to

army (49 percent) and air force (28 percent). Babus decide these budgets.

Age no bar?Number of years navy ships havebeen in service

9%15%

26%26%

24%

30 years26-30 years21-25 years1-10 years 11-20 years

cour

tesy

: ind

iann

avy.

nic.

in

26 April 15, 2014

refits/MLU (mid life updates) was the pooravailability of spares and equipment. Non-availability/failure of critical equipment,delays in supply and fitment of various sys-tems, etc, also resulted in time over-runs,the report said.

Alarmingly, it also said that most refits arestarted and completed with considerabledelays. Of the 152 refits checked by auditteams, only 18 percent commenced as perthe norms of the navy, while 74 percent werecompleted with a total delay of 8,629 days.The audit made startling disclosures thatexpose the hollowness of Indias defense pre-paredness. It claimed that naval warshipshad been extensively utilized beyond thestandard period of time before a refit wastaken up. This, it said, indicates lack ofadherence to operational-cum-refit cycle(OCRC, which determines refit schedules).

Answers given by the navy to the auditorson delay in refits point towards a criticalshortage of warships, forcing them to keepeven overused ones to maintain opera-tional requirements. The audit said: TheNavy accepted that the actual refit start datedid not match with the planned, if calculat-ed strictly as per OCRC.

There were many reasons for this mis-match, the report said. These were: The ships had undergone many opera-tional and refit cycles. Any deferment of refitor delay in completion would affect futurerefit schedule of the ship. Deferment of refit was also due to opera-tional commitment to maintain minimumforce levels. This causes a cascading affecton subsequent refits. A ship that is overduefor refit cannot be a part of an optimal solu-tion to Indias security needs.

Non-availability of spares for refits of navyships is one of the main reason for delays.The audit report commented: Availabilityof required spares continues to be a criticalarea which need to be addressed for a funda-mental reform of refit management. Lack ofrequired spares, resort to cannibalization(taking useful materials from disabled ships)and refurbishment of existing spares whentheir replacements are unavailable, are amatter of concern.

The navy is truly in choppy waters.

Trail of disastersAUGUST 14, 2013: INS Sindhurakshak, a kilo-class submarine, implodes andsinks when missiles and other ammunition go off because of unknown fac-tors, killing all 18 on board.

DECEMBER 4, 2013 (Navy Day): Indias leading minesweeper, the INS Konkan, undergoing repair in Visakhapatnam, catches fire.

DECEMBER second week, 2013: A misfire from a gun abroad ICGS Sangramhits the Western Naval Command headquarters.

DECEMBER third week, 2013: INS Tarkash, the navys newest guided missilefrigate from which the Brahmos supersonic cruise missiles was test fired inMay, hits jetty while berthing at the Mumbai naval base and damages its hull.

DECEMBER 23, 2013: Frontline frigate INS Talwar collides with a fishingtrawler off the Maharashtra coast; luckily there is no significant damage.

JANUARY 4, 2014: INS Betwa, an indigenously built frigate, reports a crack inits sonar domethe bottom of the ship. The cause of the accident is not clear.The navy launches an inquiry into the incident.

JANUARY 17, 2014: INS Sindhughosh, a kilo-class submarine operating out ofMumbai, has a near-miss when the tide suddenly recedes and the ship runsaground. However, the ship is secured with the help of tugs and ropes and nodamage is reported. The ship sails out subsequently.

JANUARY 21, 2014: INS Vipul, a missile boat from the Killer Missile Squadron,which has recently returned from a normal refit inside the Mumbai NavalDockyard, is detected with a hole in its pillar compartment while it was on anoperational deployment off Mumbai.

JANUARY 30, 2014: Amphibious ship INS Airavat suffers damages when itspropellers hit the ground while returning to the harbour in Visakhapatnam. Thecause of the incident apparently is the dredging work going on in the channel.

FEBRUARY 25, 2014: Smoke and fire in the battery kit of INS Sindhuratna, a Russian-origin diesel-electric, kilo-class submarine commissioned in 1988, results in the death of two officers. Twenty-nine peopleare evacuated and hospitalized for inhaling poisonous gases.

MARCH 2, 2014: An officer is killed and a worker injured after inhaling carbondioxide gas which leaked from a container in the INS Kolkata (Yard 701),advanced warship at Mumbai's Mazagon Dock Limited.

PROBE / army excesses

OF FIRE AND WATERRescue work at naval dockyard where explosionsoccurred in INS Sindhurakshaksubmarine in August, 2013

Getty Images

IL

27April 15, 2014

HUMAN INTEREST/NRI brides

HEN Usha Parikh left her lucrative jobin a top IT company in Ahmedabad to

marry a US-based NRI engineer, she haddreams in her eyes. But they soon crashed

when she realized that her husband was anunlettered mechanic and an alcoholic at that.

Just three months after Rekha Shah, daugh-ter of a Surat-based diamantaire, tied the knot

with a Singapore doctor, the 29-year-old preg-nant woman was desperate to return to India.

RUNAWAYBRIDEGROOM

the plight of women abandonedby nri husbands is distressing.

However, a new centre in gujaratis giving them hope and helping

them get back on their feetBy Mahesh Trivedi

Aruna

W

28 April 15, 2014

Her life had become hell, as she was con-stantly beaten by her husband and in-lawsfor more dowry.

When Anju Patel got married to aLondon-based marketing executive follow-ing an internet romance, her joy knew nobounds. Six months back, she returned toher one-room home in Vadodara, aban-doned by her husband.

There are many such distressing stories.In Punjab. And in Gujarat. Stories of girlswho live on the wings of hope as they marryNRI husbands, their heads full of fancydreams and their hearts filled with naveoptimism. Accounts of how their worldcomes crashing down as they are duped byunscrupulous and immoral husbands.

Out of 2.5 crore NRIs, Gujaratis accountfor 65 lakh. But while Punjab has gainednotoriety for cases of fraud by NRI grooms,similar cases are now coming to light in caseof NRI grooms from Gujarat too. Accordingto a 2007 study, an estimated 25,000 suchwomen are deserted in Punjab and over20,000 have not seen their husbands after

the honeymoon. In the case of Gujarat, theministry of overseas Indian affairs and theGujarat government have only now startedcompiling data.

HOME AMID DESPAIRBut all is not lost. An Ahmedabad-basedNon-Resident Gujarati (NRG) Center,launched in November 2013, now providessuch women legal help.

This is in partnership with Gujarat gov-ernment and Gujarat Chamber ofCommerce and Industry (GCCI). Ever sinceit began, harried wives and young mothershave been making frantic calls from abroad,while their worried parents in Gujarat havebeen rushing there for help.

The chairman of the center is Kulin Patel,former Indian high commissioner toUganda and ambassador to Rwanda andBurundi. He says that a majority of cases arerelated to cheating or the husband desertingthe wife, either for dowry or because of anextra-marital affair.

Six NRI women have already met Pateland sought succor. Says Patel: Many menget married due to parental pressure andabscond right after the wedding. In othercases, the man may be having an affair withsomeone else. Some couples come back hereafter a year and the husband finds someexcuse to fly back alone.

Seeing the plight of these young brides,Patel formed an expert panel with IPS offi-cer Anil Kumar Pratham, Gujarat high courtadvocate Gopinath Amin and travel profes-sional Manish Bhatt. All three help the girlsin various ways.

Pratham, who is inspector-general ofpolice as well as head of the womens cell inthe state, orders investigations into variouscases and even takes the help of Interpol.Bhatt, who has travelled the world, not onlyquickly sorts out visa-related problems, butalso asks his advocate friends to give freeconsultation to these women.

Amin, who is also the chairman of thelegal advisory committee of GCCI, says thatthe victims rarely conduct a thorough back-ground check of the groom. The womansfamily feels that the boys side will be offend-

Numbing numbers Number of complaints received by five Indian missions about fraudulent NRI

marriages since 2010-11: 179 Cases from New Zealand, Slovak Republic, China (Hong Kong), the UK and

the US in 2012-13: 66 Number of complaints received by the ministry of overseas Indian affairs

(MOIA) in 2012-13: 386 Cases from the UK in 2013-14: 15 Number of women who received assistance under the central government

scheme during 2008-09 to 2012-13: 101 Amount of money disbursed by MOIA to NGOs and 77 deserted women

abroad between 2008 and 2011: `32,86,709

Source: Data released in the Lok Sabha by minister for overseas Indian affairs Vayalar Ravi

In about 30 percent of cases,deserted wives live all by themselves and struggle to find a way to come back.

Parag Desai, a parent

HUMAN INTEREST/ NRI brides

29April 15, 2014

has taken steps over the years to check fraud-ulent NRI marriages. The external affairsministry has set up a cell in each missionabroad to help such victims. The ministry ofoverseas Indian affairs has launched an edu-cational-cum-awareness campaign for theIndian brides and published a guidance pam-phlet called Marriages to Overseas Indians.This is available in English, Hindi, Telugu,Malayalam and Punjabi. It has published abooklet with information on safeguards avail-able to women deserted by their NRI spouses,legal remedies available, authorities who canbe approached and NGOs.

The ministry provides an assistance of$3,000 in developed countries and $2,000 indeveloping countries for filing cases in courtsabroad or for legal counseling through vari-ous NGOs. Finally, distressed women have ashoulder to lean on.

(Kulin Patel, NRG Centre chairman, canbe contacted at 9825026780 or

079-4006 9603)

ed if they ask for his details, but they mustknow the complete address, contact num-bers of at least two friends who live withinthe area and one contact number of a col-league of his, warns Amin. Most of the time,the girls are young and ignorant of the lawsof a foreign country.

To increase awareness, the NRG Centrehas been distributing literature with usefultips about NRI marriages and has organizedtwo seminars in Anand and Mehsana inmid-February.

EXPANDING SUPPORTRamesh Rawani gave `25 lakh as dowry forhis daughter. After she was abandoned, hewants the center to help him recover it. Hesays the process of seeking justice is compli-cated, as Indian laws do not apply to NRIs.Another parent, Parag Desai, says: In about30 percent of cases, deserted wives live all bythemselves and struggle to find a way to comeback. Most are unaware of legal procedures.In some cases, US courts even declare adivorce through video conferencing.

But this ignorance will be a thing of thepast, as NRG centres have been set up inSurat, Rajkot, Vadodara, Anand andMehsana and more are coming up in Navsariand Bhuj.

Incidentally, the central government too

In Punjab, over 25,000 women are deserted by their NRI husbands every

year, and over 20,000 dont see their spousesafter honeymoon.

Uday Shankar

IL

CONTROVERSY/ religion and politics

20 April 1, 2014

IS HINDUTVA

A WAY OF LIFE?

way back in 1995, a supreme court judgment had held hinduism to be

different from hindu religion. but now, theapex court has decided to

re-open this controversial rulingBy Vishwas Kumar

31April 15, 2014

T IS an emotive issue and one thatcan polarize people sharply. Theinterpretations of Hindutva/Hindu-ism vary. But is Hindutva/Hinduisma way of life of the people in India, oris it a state of mind? Is it differentfrom the word Hindu? Can one

seek votes in the name ofHindutva? Will doing so violate

electoral laws that prohibit a candi-date from making an appeal to votersin the name of religion?

A landmark-yet-controversial judgmentby Supreme Court in 1995 held Hin-dutva/Hinduism to be different from Hindureligion, and had said that any appeal to vot-ers through the former didnt mean corruptpractices as per the electoral laws. It hadcome as a big booster for the BJP and itsally, Maharashtras Shiv Sena.

Both the right wing parties had alwaysargued that Hindutva was their core philos-ophy, which meant Indianization orbharatiyata and that they were not

II

tutional bench for reviewing the 1995 judg-ment. The bench contended that the judg-ment lacked clarity in defining the contextin which politicians seek votes in the nameof religion. However, it is only now after 18years that a constitutional bench has beenfinally formed.

While some experts showered praise onJustice Verma for his bold order thatgave legal sanctity to the Hindutva philoso-phy, others blamed him for fanning theHindutva forces due to his differentiationbetween religion and philosophy. But Vermahad, in the same judgment, warned that anymisuse of the word Hindutva for a narrow

political consideration should be strictlydealt with by the laws of the land.

Supreme Court lawyer Dr SuratSingh says: Saying that Hindutva isnot equal to Hindu religion is like

saying that Christianity is not equal tothe Christian religion. Also, saying that

Hindutva is a way of life puts Hindureligion on a different footing

from other religions. In ademocracy, if Hindu religionis a way of life, whyshouldnt we treat Chris-tianity and Islam as a way oflife, too?

Singh explains thatHindutva can be used in twodifferent ways. It can be usedin a progressive and inclusivemanner where Hinduism is away of life and tolerant ofother religions.

But it can also be used in adogmatic and exclusive

sense. This is by showingthat the Hindu way of life

is superior to others,bringing it in clear con-flict with the secularmandate of the consti-tution, he points out.Defending the 1995

judgment, lawyer UmeshSharma says: Hinduism is a wayof life. Even the worlds biggestreligions were influenced by it

against the minorities, as alleged by theirpolitical rivals.

However, the apex court has now decidedto re-visit this debate. Chief Justice P Sathasivam recently constituted a seven-member bench to review its previousjudgment. The decision was made onthe recommendation of a five-judgebench headed by Justice RM Lodhaand comprising Justices AK Patnaik,SJ Mukhopadhaya, Dipak Misra andFMI Kalifulla.

The controversy over seeking votesin the name of Hindutva has its rootsin the election of Shiv Sena candidateManohar Joshi to the Maha-rashtra assembly in 1990.After Joshi won theelection, his Cong-ress rival NitinBhaurao Patel fileda case in the BombayHigh Court, accusingthe Sena leader of garnering votesin the name of religion.

The high court declared his elec-tion null and void.

Thereafter, Joshi knocked thedoors of the Supreme Court againstthe high courts judgment. A three-member bench of the apex court,headed by Chief Justice JS Verma,upheld Joshis election as valid inDecember 1995, on the groundthat seeking votes in the name ofHindutva is not an offence.

Four months later in 1996,another three-member SupremeCourt bench while dealing with aseparate petition of BJP candidateAbhiram Singh on the same issue request-ed the then chief justice to form a consti-

CONTROVERSY/ religion and politics

32 April 15, 2014

In a democracy, if Hindu religion isa way of life, why shouldntChristianity or Islam also be treatedas a way of life?

DR SURAT SINGH,Supreme Court lawyer

What was your principal objection to the 1995 judgment?This whole debate that ended up in the Supreme Court (SC) occurredbecause there was a petition against the election of BJP-Shiv Sena MLAsin Maharashtra. They had sought votes in the name of religion, whereasthe election laws make it illegal for candidates to do so.

I can understand that the SC was very careful about nullifying elec-tions as it didnt want to interfere with the legislature. But the rationalebehind striking down the high court judgment was bizarre.

Justice Verma quoted Maulana Wahiduddin Khans article in TheTimes of India, where the author said that Hindutva is a kind of unitarynationalism. But if you read the rest of the article, Khan also went on tosay that this kind of unitary nationalism is terrible, really oppressive andvery bad for the minorities.

Justice Verma took a good quote out of context and turned it literallyinverse to the authors intention. It was a bad judgment based on bad reasoning.

What are the implications of the judgment?The moment SC ratifies Hindutva as a form of Indian nationalism, themajority groups can question why they are being called communal. Theycan claim to be nationalists based on the decree of the court. So youhave legitimized majoritarian communalism.

But every country has a civilizational build-up and the majoritycommunity does have an influence on its culture.It is natural that the practices and beliefs of the majority shape the politi-cal culture and discourse and institutions of a society. However, the diffi-culty arises when you begin to argue that the Republic of India should begoverned by a majoritarian consensus instead of the constitution.Hindutva here is being used to pressurize the republic, in a sense, toeither ignore parts of the constitution or read the constitution in an unnat-ural way to favor a kind of majoritarian construction. Just because youare in a majority, you cant expect everybody to defer to your views. Thatis not acceptable.

Its one thing if there is a process of decentered social practice thattends in a certain direction; its quite another to rig the game, to insistthat in a situation like Ram Mandir the views of the majority must prevail.Because after all what is at stake here is not just a piece of real estate inAyodhya, but a constitutional ground on which the republic is built. Are

SC shouldnt be blown by ideological fashions

when they came to India. These religions gotassimilated into our countrys way of life.Explaining a way of life as including lan-guage, culture, food and dress, he adds: ABihari Muslim or a Bengali Muslim may bevastly different from each other, but theywould have more similarities with theirrespective Hindu communities.

Even Sufism, part of Islam, is similar tothe Hindu culture of singing devotional

songs. Is this not Hinduism or a Hindutvaway of life? asks Sharma.

Even AG Noorani, lawyer and author,wrote in Frontline recently that there is adifference between Hinduism, an ancientand tolerant faith, and Hindutva, which represents modern hate. He also soughtrejection and review of the apex court rulingin his article.

How time can change perceptions!

33April 15, 2014

Historian and political commentator MUKUL KESAVAN, who had criticized the 1995 judgment of Justice JS Verma in his book Secular Common Sense, comments on the Hindutvadebate in an interview to Meha Mathur. Excerpts:

there rules of law that determine whether the status of a place can bemaintained or changed? You cant just override laws by invoking the majority.

How do Muslims feel about this kind of judicial intervention?It will be dangerous for me to speak on behalf of the Muslims. But theproblem is, SC, which has a very distinguished record, has over the past20-25 years delivered a set of questionable judgments on matters affect-ing Hindu-Muslim relations. The point to ponder is how do these judg-ments affect constitutional guarantees. Today its the Muslim community,tomorrow it will be someone else. When the apex court chooses to passsuch judgments this has very dangerous implications for the political cul-ture of the country.

Do you see these judgments as a part of bigger movement?If you mean there is a broader conspiracy theory like an attempt to rein-terpret the Indian constitution in a majoritarian way, I would say no. But ifyou ask has there been a broadening of the majoritarian discourse, hasthere been an attempt to shift the political commonsense of the republicrightwards, and has that succeeded, I would say yes. And the judgesbeing human, sometimes tend to defer to this consensus. And ideally,SC should not be a weather wing. It should stand fast on constitutionalground, and not be blown about by ideological fashions.

Anil Shakya

IL

ACTS & BILLS / gender inequality

34 April 15, 2014

N 1968, when smart, educated AshaSachdeva got married, she haddreams in her eyes and hope in herheart like any young bride. Shelooked forward to a life of maritalbliss and spending her autumnyears with her husband in her mar-ital house. But it wasnt to be. Forty-

six years later, at the age of 67, Asha is fight-ing a lonely battle for her right to protectionand shelter in her husbands house.

Ironically, the upheaval in Ashas lifestarted in 2005, when the Hindu SuccessionAct 1956 (HSA) was amended. The changeincluded daughters as coparceners ( jointheir) in the Mitaksara (one of the schools ofHindu law) family property with the samebirthrights as sons. While it was meant tosecure the future of daughters, it dealt ablow to wives who had been abandoned,deserted or widowed.

Thats precisely what happened to Asha.In 2009, she was abandoned by her hus-

band, who moved into an old-age home ashe did not want to fight with his sisters.

With no financial support from him, Ashastruggled to make ends meet. Her onlydaughter, married and settled abroad,helped her occasionally.

MARRIED WOMENS WOESTragically for Asha, the house where she hadspent almost all her life, was now beingclaimed by her sisters-in-law. This particu-lar case shows how despite good intentions,legal reforms to overcome gender inequalityand discrimination dont benefit all women;some innocent victims like Asha are left bythe wayside.

While the 2005 amendment helpeddaughters demand partitionthough theyalso share liabilities nowit was deletion ofSection 23 of the 1956 act that diminishedthe right of married women in their maritalproperty. This section was a special provi-sion with respect to dwelling houses and

HOUSE OF DISCORD

an amendment in the hindu succession act was meant to give equal rights

to women. but while it helped the daughters to get a share of their fathers property,

it left the mothers by the waysideBy Shivani Dasmahapatra

I

35April 15, 2014

held that married daughters could not askfor partition until the sons decided to do itfirst. The reasoning then was that forcing ason to partition the house would leave himand his family shelterless. The section hadalso provided for rights of widowed women tobe settled before the sons and daughterscould ask for partition.

Until 2005, the biggest protection wiveshad in the marital home was the status ofbeing married, which carriedwith it the right to be main-tained, not only by the hus-band, but by the joint family asits assets were also her assets.

But Asha finds herself with-out shelter now. This has beenmy whole life. Why am I beingpushed out of my home now?asks Asha plaintively. At thetime of marriage, she had togive up her job as demandedby her husband and made to

take care of her ailing mother-in-law.Neither could she look after her deceasedfathers business interests as, again, her hus-band didnt allow it.

PROGRESSIVE STEP?Though the new succession law seems pro-gressive and is a step in the right direction, itleaves women like Asha Sachdeva in thelurch. That women have been made

coparceners with the samerights as male members isvery empowering. But, it hasreduced the share of wives in aproperty where she has livedas an owner, points out advo-cate Geeta Luthra.

It doesnt serve the empow-erment of women to give jus-tice to one category, whiledenying it to the other. Thegap between the vision andharsh reality is too evident.

VICTIM OF A PROGRESSIVELEGISLATION

Asha Sachdeva, who was deprived of her marital

property following the 2005 amendment to the Hindu

Succession Act

IL

Photos: Shivani Dasmahapatra

once at the helm of a democratic nation-building, our legal mps are unabashedly protecting dynastic politics in their new avatars

By NV Subramanian

ROM the 2G scam zero-loss theory to the abuse of AnnaHazare and constitutional functionaries and intriguesagainst opposition leaders, the lawyer-politicians of theruling party are displaying the egregious side of their legaltraining. Is this an aberration or par for the course, or arethey victims of the fallen standards of public life, warped inparticular by dynastic politics? A little of all, and lawyer-politicians in the opposition deport no differently in power,arrogance being their calling card, although in the defenseof dodgy deals, their record may not be as chequered astheir fellow professionals on the government side. The fallfor the community of lawyer-politicians has been substan-tial since the national movement and precipitous in the

LEAD/ lawyer-politicians

36

FAruna

bankers and businessmen squeezed theirnumbers in recent decades, India showed adeclining liking for this trade from the sec-ond Lok Sabha onwards, increasingly mix-ing its population with agriculturists.

As the democratic process expanded andencountered entrenched caste, class, com-munity and regional interests, the complex-ion of the Lok Sabha transformed further,and the net losers were lawyer-politicians,unless they embraced other identities,which they actually did in most cases.

The rise of dynastic politics with IndiraGandhi also reduced the role of politiciansas lawyers in her iron reign, except in thephases where she clashed with the judiciary.The core of the trend she started still contin-ues. Today, the Lok Sabha and the RajyaSabha have about the same number oflawyers75 eachbut a majority of themhas never practised.

NEW AVATARBut the troubles of the present are not somuch derived from this state of affairs, asthe fact that politics has been so distorted bythe original sin of dynasticism, Mrs

EPICENTEROF ROT

past few years, and the depths of depravity,it would appear, have not been plumbed.

WANNABE POLITICIANSThe national movement had its careeristlawyer-politicians to be sure, and theirmotivations were not entirely idealistic.Motilal Nehru was inclined to supportJawaharlals political ambitions with hislawyerly earnings in what would innocu-ously seem the first hint of dynastic long-ings. Others were less candid but equallyambitious. They were working towardsimportant political positions in independ-ent India and as many as one-half of thelawyers of the freedom movement attainedtheir career goals.

INDIA AND THE USA rough democratic parallel may be foundin the United States but there are importantdifferences as well. Its founders were not alllawyers, although they may have been inpreponderance. The first president was ami