Court rejects CBI's closure report filed in urea scam case after 22 years

Special Judge Surinder S Rathi did not mince words in his recent order as he pointed out that the last investigation in the case was conducted by the Central Bureau of Investigation (CBI) in 1999 and that it was evident that the agency sat on the report, which is legally unacceptable.

New Delhi: In an embarrassment to the CBI, a special court rejected its closure report in a case related to the urea scam, asking it to probe the 22-year delay in filing it and ensure that such "miscarriage of justice" does not happen again. Special Judge Surinder S Rathi did not mince words in his recent order as he pointed out that the last investigation in the case was conducted by the Central Bureau of Investigation (CBI) in 1999 and that it was evident that the agency sat on the report, which is legally unacceptable.

"This is obviously a cause of concern to this Court and also should be a cause of concern for the head of Investigating Agency i.e. Director, CBI," the judge said. The CBI director shall look into the matter and take necessary action as also steps to ensure that such "miscarriage of justice" does not happen again, he said. "It is not CBI's case that any investigation was going on in the matter after 1999 up to 2021... One fails to understand as to why the same (final report) was being withheld and what purpose the withholding must have been serving," the court noted. The judge also ordered the joint director of the prestigious anti-corruption unit 1 of the CBI to inquire into the matter and submit a report.

"Evidently, when the current final report was filed, the IO and the concerned SP conveniently did not discuss anything about this 22 years' delay, even though they had an opportunity. Such conspicuous and deliberate silence in explaining the delay is legally unacceptable," he said. The CBI had registered the urea scam case on May 19, 1996, on allegations that the accused persons entered into criminal conspiracy and cheated the National Fertilizer Limited (NFL) to the tune of Rs 133 crore. In the main case, several NFL officials, private businessmen and former prime minister P V Narsimha Rao's nephew B Sanjeeva Rao were convicted.

The case in which the CBI filed its closure report was registered on June 4, 1997, and is related to the supply of one lakh metric tonnes of urea. The CBI had named former NFL MD C K Ramkrishnan and executive director D S Kanwar, chief executive of Hyderabad-based Sai Krishna Impex M Sambasiva Rao and S Nuthi of USA-based Alabama International INC in its FIR. The agency filed its closure report against these accused in January 2021, saying no pecuniary loss was suffered in the case. It was alleged that Ramkrishnan and Kanwar gave repeated concessions to Sanjeeva Rao and Nuthi who failed to supply urea, the court noted in its order.

According to the conditions, failure to fulfil contract would have resulted in forfeiture of Performance Guarantee (PG) Bond in favour of the NFL. The court pointed out that instead of forfeiting 2 per cent PG Bond, cumulatively valuing USD 3.01 lakh (current value more than Rs 2.28 crore), for repeatedly failing to supply urea as per letters of intent (LOI), Kanwar returned these bonds on January 8, 1996, to Nuthi and the NFL was constrained to purchase urea from a third party. Citing the statement of an additional manager of the NFL, a prosecution witness, the court said Sambasiva Rao was introduced to Ramakrishnan by Sanjeeva Rao.

"I do not find any iota of credence in the conclusion arrived at by the Investigating Officer and the SP of CBI when they say that no pecuniary loss was suffered by the Government. The PG Bonds (having a) value (of) USD 3.01 Lakhs in 1995 (Current value Rs 2.28 crores) constituted valuable property...," the court pointed out in its order rejecting the CBI's closure report. There was sufficient material to summon all the four as accused, it added. Going through the case files, the special judge said the last investigation in this case was carried out on March 11, 1999, and thereafter on March 17, 1999, when the draft final report was prepared.

"Thereafter, only two case diaries were prepared, the last being (on) May 12, 1999. Evidently, the agency sat over it and the final report... was filed before the Special Judge only on January 12, 2021 i.e. after a good gap of mammoth 22 years," the court noted. It took the CBI back to basics, underlining that binding statutory laws show that investigating agencies are "duty-bound" to complete the probe without unnecessary delay and forward the investigating report to the court competent to take cognisance "without any delay".'

PTI