A special CBI court on Wednesday, 13 December, convicted former Jharkhand Chief Minister Madhu Koda in a coal allocation and mining scam. Apart from Koda, the court held former coal secretary HC Gupta, former Jharkhand chief secretary Ashok Kumar Basu and one other guilty of criminal conspiracy.
The Delhi court will pronounce the sentencing and quantum of punishment for the convicts on 14 December.
Here’s a look at the details of how Koda reportedly amassed astronomical sums of money through the scam.
Who is Madhu Koda?
Koda was the third chief minister in the history of the country to hold the post as an independent legislator.
Sworn in as the fourth CM of a politically turbulent Jharkhand on 14 September 2006, he retained the post till he was ousted on 23 August 2008. His wife is an MLA from the West Singhbum constituency in the state.
The son of a farmer, his family calls him an ambitious person who “dreamt too big.” Koda entered politics as a student leader, and went on to hold immense power as an independent candidate. His support was vital in deciding governments led by both the UPA and the NDA. He became the minister of mining in 2005.
In 2006, after initially having supported Arjun Munda’s NDA government, Koda and three other independent legislators withdrew their support, bringing the government into minority. After Munda’s subsequent resignation, the UPA propped up Koda as the chief minister through consensus. His reign lasted till mid-2008, when the Jharkhand Mukti Morcha’s Shibu Soren staked claim to form the government, forcing Koda to resign. He continued to hold the portfolio for mining through this period.
In the 2009 Lok Sabha elections, Koda won the seat from Singhbhum constituency as an independent candidate.
What Is the Mining Scam?
Koda came under the Enforcement Directorate’s scanner after the agency stumbled upon discrepancies in his financial matters while investigating another case related to Governor Syed Razi.
The scam pertains to alleged irregularities in allocation of coal blocks in Jharkhand to companies. The CBI and ED alleged that Koda took bribes for illegally allotting coal and mining contracts during his tenure as chief minister. The investigative agencies round off the figure to about Rs 4,000 crore, allegedly amassed in this period by Koda and his associates.
The agencies pin Koda’s modus operandi to 26 Memorandums of Understanding (MoUs), and recommendations to illegally allot mining projects. While several ministerial clearances were required for the said mining projects, Koda, the investigating agencies say, used his discretionary powers as chief minister to recommend a company or a project – for a price.
A Frontline report quoted sources from the investigating agencies saying Koda charged anywhere between Rs 2 crore to Rs 20 crore to sign an MoU, based on the proportion of the project being allotted. Similarly, recommendations were reportedly priced between Rs 30 to 80 crore, based on the mineral. The money was generally siphoned off through small-time finance companies or hawala channels.
The mining case against Koda predominantly deals with a Kolkata-based firm named Vini Iron and Steel Udyog Ltd (VISUL).
The CBI, in its chargesheet, had said that VISUL had applied for allocation of Rajhara North coal block on 8 January 2007 to the ministry of coal.
The CBI further alleged that although the Jharkhand government and the steel ministry did not recommend VISUL’s case for coal block allocation, the 36th Screening Committee recommended the block to the said firm. Thus in 2008, VISUL was allotted the coal block with Koda making false claims that it was indeed part of the consortium.
Apart from this case, raids led by Income Tax officials found alleged irregularities in allocating rural electrification work to a firm named IVRCL, when Koda was the minister for power in Jharkhand. He was granted bail in this case in 2013.
Who Are the Key Players?
Besides Koda, the eight others initially accused in the case were former coal secretary HC Gupta, Kolkata-based Vini Iron and Steel Udyog Ltd (VISUL), former Jharkhand chief secretary AK Basu, two public servants – Basant Kumar Bhattacharya and Bipin Bihari Singh – VISUL's director Vaibhav Tulsyan, Koda's alleged close aide Vijay Joshi and chartered accountant Navin Kumar Tulsyan.
While the court on 13 December charged Koda, Gupta, Basu and one other ‘guilty of criminal conspiracy’, it acquitted the firm’s director Vaibhav Tulsyan, public servants Bhattacharya and Singh, and chartered accountant Navin Kumar Tulsyan of all charges.
HC Gupta: The CBI said that Gupta, who was the chairman of the screening committee, had concealed from the then prime minister Manmohan Singh, who then headed the coal ministry as well, that Jharkhand had not recommended VISUL for allocation of a coal block. According to an Indian Express report, the CBI court hearing the case said on 15 June 2015 that Gupta has prima facie “acted in violation of the trust imposed in him by law and facilitated allocation of impugned coal block in favour of VISUL.”
The court further observed that Gupta’s role cannot be “strictly bracketed merely as that of an advisor” to the minister-in-charge, hence charging him to be equally responsible for the administrative functioning of the ministry.
VISUL: The mining scam predominantly pertains to the alleged irregularities in allocation of Rajhara North coal block in Jharkhand to VISUL. The court framed charges against the firm under Section 420 for committing fraud.
AK Basu: According to a prosecution witness, the then chief secretary Basu in the screening committee insisted on the allocation of the Rajhara block to VISUL. Apart from charges of ‘criminal conspiracy’, the court framed him with charges under relevant provisions of the Prevention of Corruption Act applicable for a public servant.
BK Bhattacharya and Bipin Bihari Singh: Bhattacharya was the then section officer in the Department of Mines in Jharkhand, while Singh was the then Director Mines in the state. Both of them were booked by the CBI court for alleged offences under the Prevention of Corruption Act before being acquitted.
Vaibhav Tulsyan: Director of VISUL Tulsyan was also framed with charges under Section 420, apart from charges of criminal conspiracy, but was acquitted by the CBI court.
Vijay Joshi: A close aide of Koda’s, Vijay Joshi is the owner of VISUL. However, a Firstpost article said that Joshi was only the ‘dummy’ owner of VISUL, which was allegedly owned by Koda himself. Koda, according to the report, acquired VISUL, and later recommended allocation of blocks to his own company to further personal interests. The court had charged Joshi too with prima facie committing offence of cheating under Section 420 of the IPC.
Navin Kumar Tulsyan: A chartered accountant, Tulsyan had also been charged under Section 420 for making ‘accommodation entries’ to camouflage the illegal money routed in the case. He was also acquitted by the CBI court.
Madhu Koda and the 'Coalgate'
Apart from recommending VISUL, the CBI said that Koda had also favoured other firms like Rungta mines, Sunflag Iron and Steel Ltd and Electrosteel Castings – none of which featured in the state government’s consortium.
Koda was involved in alleged irregularities with regard to the allocation of Amarkonda Murgadangal coal block to the Jindal group of firms. In its chargesheet, CBI has alleged that Jindal had promised Congress support to the then "unstable" Koda government in Jharkhand in return for a recommendation for allocation of Amarkonda Murgadangal coal block to his group firms.
The court had said that according to the CBI's chargesheet, Koda had conspired with Jindal and abused his official position to extend "undue benefits" to the latter’s firms.
What Has Happened So Far in the VISUL Mining Case? A Timeline
9 October 2009: ED registers case against Koda and his associates, charge him under PMLA.
6 November 2009: Koda’s residences etc. are searched by IT officials sparked by an ED investigation.
30 November 2009: Koda is arrested by the state vigilance commission.
18 February 2015: Koda and his associates are granted bail by special CBI judge Bharat Parashar.
31 July 2015: The accused are put on trial in the VISUL case by special CBI court under charges of ‘criminal conspiracy.’
27 September 2017: Koda is disqualified from contesting elections for three years by the Election Commission, for failing to file expenses related to the 2009 Lok Sabha polls.
13 December 2017: Delhi's Special CBI court holds former Jharkhand CM Madhu Koda, former Coal Secretary HC Gupta, former Jharkhand chief secretary Ashok Kumar Basu and one other guilty of criminal conspiracy.
14 December 2017: Sentencing to take place.
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