Coalgate: PM not off the hook even if CBI closes probe against Birla

The Prime Minister's eloquent defence of his decision to allocate a part of the Talabira II coal block to Kumar Mangalam Birla's Hindalco sets the stage for a gradual winding down of the CBI cases against India Inc. Reason: if the files cleared by the PM in Birla's case were "entirely appropriate," there is no way the PM is going to claim otherwise in other such allocations where he had signed off on block allocations.

Since it is the government's right to decide how a policy has to be implemented, it is now highly unlikely that the CBI can proceed against Birla when the PM himself says the case was decided on "merits". The CBI will have a case only if it can show a nexus between the decision taken and the private parties who benefited, including an element of quid pro quo. A Times of India story today (21 October) suggests as much when it said the CBI may close the investigations in this case.

 Coalgate: PM not off the hook even if CBI closes probe against Birla

File photo of Manmohan Singh. AFP

However, the PM’s statement and the CBI’s likely move to close the case shift the spotlight from the real issue: the Coalgate scam was not just about who got what block, but why no transparent process was put in place to award blocks. Why were the coal blocks not auctioned? This is where the PM’s role looks questionable.

The second, and more important, question relates to the naming of PC Parakh, former coal secretary when the Birla file was doing the rounds, in the FIR filed by the CBI last week. The point is, if the PM's decision was beyond reproach, why was Parakh implicated?

Logically, if the CBI closes the case against Birla, the case against Parakh too should be closed. But will that happen? Parakh himself has said that if he is a conspirator, the PM should be considered one too.

Parakh is crucial to the Coalgate scam because he was the official who wanted the government to auction coal blocks. But the government decided otherwise, and opted for an opaque process of deciding applications on a case by case basis. The applicants were vetted by a screening committee, whose selection criteria were far from clear.

The CBI is said to be investigating Parakh’s links with some of the companies which were given coal blocks. Apparently, Parakh was a director on Navbharat Power when it applied for coal blocks.

Conspiracy theorists speculate that naming Parakh as a potential accused was crucial to taking the spotlight off the PM because he was the one who knows why the recommendation to auction coal blocks got scuttled. But, by making him a potential accused, any testimony he can give in the Coalgate scam will be discounted. An accused’s testimony is not considered valuable since it is assumed that he will say things to benefit himself.

This is the reason why A Raja’s claim that the PM fully concurred with his decision on 2G spectrum allocations is discounted. Parakh, who the Comptroller and Auditor General (CAG) thought of as a likely whistleblower in the scam, is thus neutralised as a witness in Coalgate as long as he is a potential accused.

It is significant that when the PM justified the decision to award the Talabira II block to Hindalco, he added a minor rider. The statement released by his office said: “The Prime Minister is satisfied that the final decision taken in this regard was entirely appropriate and is based on the merits of the case placed before him.” (Italics mine)

Note the second half of the sentence. If the decision is appropriate only to the extent the primary facts were the same as he was presented with, it places the onus of proving the case as having merit not on the PMO, but on the coal secretary and the coal ministry, including Parakh.

Parakh may not be quite off the hook. And there could be a political reason for this.

Updated Date: Oct 21, 2013 15:01:41 IST