Kumar Mangalam Birla
New Delhi, Oct. 16: The CBI tonight claimed a cash haul of Rs 25 crore from the Hindalco office in New Delhi, hours after two UPA ministers said the agency should refrain from trying to create an atmosphere of fear by targeting industrialists like Kumar Mangalam Birla.
The CBI took the uncommon step of going on record to say that the cash was found in the Hindalco office during a search yesterday soon after Aditya Birla Group chairman Kumar Mangalam Birla was named in an FIR in a coal block allocation case.
The revelation almost 24 hours after the search and a few hours after the ministers’ remarks suggested that the agency, fortified by court pronouncements on autonomy, could be on a collision course with the government. Usually, the agency passes on information on sensitive cases through off-the-record briefings that do not carry the accountability of a formal statement.
“We recovered over Rs 25 crore in cash from Hindalco’s third floor office on Parliament Street. The money was unaccounted for and it was given to the income tax department for further probe,” said CBI spokesperson Kanchan Prasad.
A spokesperson for Hindalco, which had yesterday contested the charges against Birla, said tonight that the company had no comment to offer on the CBI disclosure on the cash seizure.
Earlier in the day, Union commerce and industry minister Anand Sharma said the move to name Birla in the CBI chargesheet was “unwarranted and unfortunate”.
“Authorities who have some constitutional duties to discharge should not go for overreach or play to the gallery and create an environment of sensation and shock,” Sharma told NDTV.
“The larger question which comes up is that whether we have an environment which is conducive to decision-making and also which gives confidence to the investors,” Sharma said.
Corporate affairs minister Sachin Pilot was more cautious in his criticism of the CBI, which had been told by the Supreme Court not to behave like a “caged parrot”. The CBI had also told the court that it needed freedom from bureaucrats.
“While no one is above the law and wrongdoers have to be brought to justice, we must ensure that such actions are based on hard facts and do not create an atmosphere of fear and uncertainty,” Pilot told PTI. “Recent incidents will certainly dampen business confidence and investment sentiment… and perhaps also negatively affect decision-making,” he added.
The coal allocation controversy traces its roots to the absence of an auction-based system in the country, which has been put in place by the Manmohan Singh government since then. The decision-making process earlier was not illegal and auctions alone cannot be counted as the best method but the lack of transparency had given rise to charges of crony capitalism.
P.C. Parakh, the then coal secretary who has been named in the FIR along with Birla and accused of entering into a conspiracy, defended his decision today. But the defence was overshadowed by a parallel Parakh drew with the Prime Minister to defend himself, which was construed by some as an indictment of Manmohan Singh. ( )
But Parakh, a widely respected officer, denied he was under pressure from the PMO and insisted that the Prime Minister supported his initiative for transparency.
Like minister Sharma, Parakh referred to the threat posed by the CBI action to decision-making. “If the CBI behaves like this, people will find it difficult to take decisions, especially young officers. It should have a relook at the entire case,” the retired officer said in Secunderabad.
The former secretary did not use the phrase “policy paralysis” but inertia after the UPA lost its nerve in the face of a series of corruption charges is viewed as the principal reason that prompted several industrialists to look for solace in Narendra Modi, the BJP’s candidate for Prime Minister.
Birla, who usually keeps a low profile, had shared a platform with Rahul Gandhi on October 7 during the foundation ceremony for a food park at Jagdishpur in Amethi, the Congress vice-president’s constituency.
Parakh said that he had met Birla — something the CBI has been underscoring as evidence of “conspiracy” — and was convinced of his case for the coal block.
Asked if a meeting alone can be construed as conspiracy, CBI spokesperson Prasad said: “We suspect that only after meeting Kumar Mangalam Birla in July, he bent rules and allocated the blocks to Hindalco.”
Asked what evidence the agency has got so far against Birla, Prasad confined herself to saying: “We suspect that the entire conspiracy was hatched after both met in July 2005. The matter is still under investigation.”
Industry expressed concern. “Birla is the chairman of several companies in the country and abroad, and he cannot be held responsible for each and every action taken by the company,” said Ajay S. Shriram, the CII president-designate.
“We swing from one extreme to another…. Witch hunting is an extreme step,” Biocon’s Kiran Mazumdar-Shaw tweeted.