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The ruling effectively disqualifies the former chief minister from contesting elections for the next six years.
Special judge P. Anbazhagan also ordered Jayalalitha to two years in prison in a second Tansi case. The sentences will run concurrently.
The others convicted were Jayalalitha�s confidante Sasikala, former minister Mohammed Asif, two senior IAS officials, R. Karpoorasundara Pandian and T.R. Srinivasan, and an official connected with the registration department, S. Nagarajan.
The judge suspended the sentences till November 7 to enable the convicted persons to appeal in the high court. Though Jayalalitha walked out free, Sasikala in tow, she has to return to the court shortly to face trial in the Rs 66 crore wealth accumulation case.
Jayalalitha, 52, was chief minister in 1992 when two private firms, � Jaya Publications and Sasi Enterprises � in which she was partnered by Sasikala, bought land and buildings from the state-owned Tamil Nadu Small Industries Corporation (Tansi) in a deal leading to a loss of Rs 3.5 crore to the exchequer.
The judge sentenced all six accused to three years in prison in the Jaya Publications case and to two years in the Sasi Enterprises deal. Asif was acquitted in the second case.
The conviction is the second against the ADMK chief who was voted out of office in 1996 in the wake of a slew of corruption charges.
In February, an anti-corruption court sentenced her to one year�s rigorous imprisonment in the Pleasant Stay Hotel case on the grounds that she favoured a property developer to illegally build the hotel in Kodaikanal during her term in office.
Jayalalitha appealed against the February conviction and is free pending the result of the appeal. But today�s verdict could be more damaging to her career than the earlier judgment.
Unless she is exonerated by a higher court, Jayalalitha will not be able to contest elections for six years. The Tamil Nadu Assembly polls are slated for early next year.
The Representation of People�s Act says �any person convicted of any offence and sentenced to imprisonment of not less than two years will be disqualified from the date of such conviction and will not be allowed to contest for six years since his or her release�. The Election Commission has, in recent years, enforced this provision by making it mandatory for all prospective candidates to sign a declaration while filing their nomination papers that they have not been convicted for any offence.
Moments after reaching her Poes Garden residence following the ruling, Jayalalitha indefinitely postponed the ADMK general council meeting, on the electoral strategy, scheduled for tomorrow.
Jayalalitha remained glum right through the proceedings today. She, however, gave a hiding right in the court hall, after the judgment was delivered, to the counsel for one of the IAS officials in the dock. Apparently, he had told the court that his client had only executed the orders of the chief minister, turning the knife deeper in her wound.
The conviction in the Tansi case comes after years of courtroom wrangling between the prosecution lawyers and Jayalalitha�s battery of legal eagles.
The defence filed nearly 100 interlocutory petitions for adjournment. Sasikala had demanded translation of all the documents in Tamil, fought all the way to the Supreme Court and succeeded. When everybody else implicated in the 48 cases in the special courts demanded an equal treatment, the government had to employ an army of translators at a whopping cost of Rss 45 lakh.
A petition was then filed that reservation norms were not followed in the appointment of the translators. The plea was dismissed.
After the papers were translated, Sasikala sought more time to go through the Tamil documents as she claimed she was suffering from an eye injury sustained some years ago.
Finally on the day Anbazhagan ordered the framing of charges in February 1999, Asif obtained a stay from the Madras High Court on the plea that the special judge was biased against the accused.
High court Justice S.S. Subramani, who had granted the stay, made some caustic remarks against Anbazhagan, saying he had called on him and tried to influence him.
As the controversy deepened, Justice Subramani was shifted to another bench, and Asif�s petition was posted before Justice R. Shanmugam who finally ordered the framing of charges.
Jayalalitha, in turn, was discharged from the case by the high court, but the Supreme Court overturned the ruling.
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The 11-page supplementary chargesheet filed before special trial judge Ajit Bharihoke accused the Hinduja brothers of cheating under section 420 of the Criminal Procedure Code and criminal conspiracy under section 120-B of the IPC, besides charging them under various provisions of the Prevention of Corruption Act. This is the second set of chargesheets that the CBI has filed.
The Hindujas were accused of receiving illegal kickbacks in the purchase of Howitzer guns in 1986 when Rajiv Gandhi was the Prime Minister. The former Prime Minster is also an accused in the case but his name figures in column 2 of the chargesheet since he is no more and cannot be tried.
The Hindujas, according to the chargesheet, held six Swiss bank accounts � Tulip, Montblanc, Lotus, Pitco, Jubilee Finance and Maino � in which kickback monies were deposited from time to time.
The CBI obtained the �sixth account�, initially untraceable, and, based on this finding, filed the chargesheet against the industrialist-middlemen brothers.
Besides the document, the CBI also claimed that eight witnesses and their corroborating statements had incriminated the Hindujas.
The three brothers have been accused of receiving 81 million Swedish kronas as kickback, which amounts to 21 per cent of the contract money the Indian government paid to M/S A.B. Bofors, manufacturer of Howtizer guns, in May 1986.
The monies were deposited in three Swiss banks � namely the Swiss Bank Corporation, the Credit Swiss Bank and the Hanover Manufacturer�s Trust. The funds were kept in various accounts and often changed so that the accounts remained untraced.
The prosecution charged that the Bofors kickback money was shared among various persons, including the Hindujas, Italian businessman Ottavio Quattrocchi, said to be a close family friend of Congress president Sonia Gandhi and her late husband Rajiv Gandhi, and Indian middleman Wisheshwar Nath Chaddha alias Win Chaddha.
The �middlemen�, according to the prosecution, helped Bofors to clinch the contract to supply 400 155mm Howitzer guns for India�s defence needs. Unlike many European countries, giving or receiving kickback is a crime in India.
The Indian government had also then declared that there would be no middlemen or payment as commission or kickback in the deal. The CBI now argues that this condition was breached by the accused.
The Hindujas had declared on oath before the Swiss investigation magistrate court that the funds they received from Bofors had nothing to do with the deal.
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Vajpayee will be �running the country� even while having his knee joint replaced at Breach Candy Hospital tomorrow. New York-based surgeon Chittaranjan Ranawat, who will operate on Vajpayee, said the Prime Minister will be put on �regional� anaesthesia so he could �hear, talk and communicate� during the operation expected to last at least an hour.
�He won�t be unconscious, but at the same time won�t feel any pain at all,� Ranawat said. �This type of anaesthesia is very safe.�
Union information technology minister Pramod Mahajan said the Prime Minister will issue orders from his hospital bed during his week-long stay at the hospital.
Leaning on a cane, the septuagenarian Vajpayee may walk around in five to 10 days, depending on how fast he recovers from the surgery, Ranawat said. �Moving around on a cane is not a bad thing when you have a problem walking.�
Shortly after Vajpayee checked into the hospital around 4 pm, Ranawat, who flew to Mumbai last night, examined him and found him �in good spirits�. The surgeon, who has operated on 3,000 patients since 1974, said 95 per cent of his patients did not face any trouble walking for 10 years.
Odds are that the Prime Minister will soon get back to work, he said, but did not say when. �It is hard to predict precisely.�
Ranawat said there were better hospitals elsewhere, but he picked Breach Candy because �I feel at home there.� He will return to New York on Saturday, but Vajpayee will stay for a few more days because his surgeon wants to �monitor his post-operative condition� even from New York.
Accompanying Vajpayee is a string of close aides including national security adviser Brajesh Mishra, joint secretary Ashok Saikia and officer on special duty Ashok Tandon. Sudheendra Kulkarni, Vajpayee�s trouble-shooter, also came as part of the official entourage.
The Prime Minister�s adopted daughter Namita and son-in-law Ranjan Bhattacharya are also here. Advani was expected to come tonight and stay at Vajpayee�s side throughout tomorrow.
Vajpayee was driven straight to the police-ringed hospital from the airport and entered through a side gate, declared off-limits to the public and media.
Reporters and television crew, kept waiting under an awning inside the hospital�s main gate, could not catch a glimpse of him or his motorcade, which had entered the hospital silently.
The senior officials soon moved into Raj Bhavan, where a makeshift Prime Minister�s Office was set up. Telephones began cackling and fax machines whirring at the office.
While Brajesh Mishra might return to Delhi in a couple of days provided Vajpayee was �absolutely okay� after the operation, the other aides would return only with their boss, sources said.
As BJP workers prepared to hold yagnas at almost all major temples in Mumbai and Muslims readied to offer namaj at mosques praying for his speedy recovery, Vajpayee said he was �overwhelmed by the outpouring of warmth and affection�.
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The army was called in to assist the civil authorities quell the escalating violence in the communally-sensitive town.
The district administration imposed an indefinite curfew on Biharsharif yesterday following brewing tension in the area over the idol which had been installed on the disputed plot last week. Both communities claim the piece of land as theirs and a case is pending in court since 1993.
Sources in the town said that on October 1, a group of residents installed a marble idol, which, they claimed, was unearthed from the land. They constructed a makeshift pandal, which, the administration was given to understand, would be dismantled after the Dussehra festival.
However, the sources said, the residents soon began preparations for building a permanent mandap on the site and a structure made of bricks was constructed inside the pandal.
The simmering tension exploded yesterday after thousands of devotees thronged the site for prayers. Members of the minority community marched to the district police headquarters and said the structure must be dismantled.
Members of both communities, armed with weapons, took over the streets and battled each other, forcing the authorities to clamp an indefinite curfew.
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Ficci president G.P. Goenka emerged from today�s meeting at North Block, the finance ministry�s imposing headquarters here, and happily announced he would work with the other two business chambers to come up with a joint recipe for growth.
Goenka�s overture was immediately spurned by Arun Bharat Ram, his counterpart from CII.
�CII will give its own suggestions based on its own studies,� Ram said in a frosty reaction to Goenka�s comment.
The chambers � especially Ficci and CII � have had bitter relations in the past as they jockeyed to grab the attention of the prevailing government at the Centre. Assocham�s Shekhar Bajaj decided to play it safe by saying his chamber had an open mind on the issue. �It could be joint or individual formula,� he said tactfully.
Sinha was calling for the suggestions at a time when the growth in the economy has slowed to 5.8 per cent in the first quarter (April-June) from 6.9 per cent in the year-ago period.
Chamber mavens say the real battle is over suggestions on the role of foreign direct investment. With the rupee trading at record lows vis-�-vis the dollar, a section within the finance ministry as well as chambers like Assocham and CII want the investment barriers eased further so that the resultant flow of greenbacks will get the lumbering economy ticking once again.
Ficci, however, has different ideas. It wants growth to be spurred mainly by domestic investment; it favours a strong leash on foreign investment. For instance, it seeks opening up of the highly controlled aviation sector but it does not want foreign airlines to invest in the domestic aviation sector. Nor does it want foreign airlines to be permitted to acquire a controlling stake in Air India, the loss-making national carrier in which the government is selling off a part of its holdings.
The traditionally conservative chamber also wants the insurance market to remain a preserve of Indian-controlled companies, while Assocham wants this sector to be opened up to foreign investors to a greater degree.
The chambers even seemed to disagree on the sectors that need to be propped up. CII is focusing on industries such as automobiles while Ficci has made a strong case for traditional industries like cement, steel and capital goods.
These suggestions are largely dependent on the philosophy and the compulsions of the industrialists that the chambers represent.
However, the industrialists seem to agree on a few issues. Domestic taxes on manufactures should be reduced while taxes on imports should be raised to protect local production.
They are also in favour of pump-priming measures where the government spends more to boost demand.
The industrialists also agree that there should be a reduction in the cost of credit while easing its flow to industry. At the same time, labour laws should be relaxed and industry allowed easier exit routes.
Despite the differences, most of which cropped up after the conclave, much of today�s meeting itself was a tame affair though the three chambers disagreed with IDBI chairman G.P.Gupta�s contention that while bank deposits had grown by 14 per cent in the last six months, credit to industry had grown by as much as 23 per cent.
With industrial growth down to 5.5 per cent in the first quarter from 6.1 per cent in the previous year, Ficci painted a pretty grim picture for the future in its own survey of the economy. �Eighty-three per cent of our members feel growth is slipping,� said Goenka. �Not one of the corporates responding to Ficci�s queries have indicated they are planning a fresh greenfield investment.�
Sinha himself admitted that some sectors of the economy were caught in a negative growth trap and conceded the way out might be to implement �the immediately implementable demands.�
The finance minister�s meeting with chamber leaders, IDBI and ICICI top brass and his own top aides � the finance secretary, secretary expenditure and chief economic advisor � to discuss ways to reverse the economic slowdown is likely to become a quarterly brainstorming feature. Finance ministry mandarins will use the inputs from these meetings to shape post-budget fiscal policy.
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