The fall and fall of Chhagan Bhujbal: The seven people who brought the NCP strongman down

After reaching dizzying heights in a career spanning four decades across political parties from Shiv Sena to Congress and finally to Nationalist Congress Party, former Maharashtra deputy chief minister and NCP strongman Chhagan Bhujbal (68) now finds himself perhaps in the most critical juncture of his journey.

Chhagan Bhujbal. PTI

The influential OBC leader was arrested on Monday under the provisions of the Prevention of Money Laundering Act (PMLA) by the Enforcement Directorate (ED) after the agency could establish the chain how the bogus deals and illicit funds funneled into the Bhujbal empire. Ironically, those who stood by him for all these years seemed to have turned bete noire as the business empire he had built so far stands on the verge of collapse.

From a nonentity existence as a street vegetable vendor to his tenure as the second-in-command at the Mantralaya in Mumbai, Bhujbal's rapid rise to fame is a political folklore. During his rush to glory, he relied heavily on his nephew Sameer Bhujbal but the very pillar that supported him has now cut his roots. Sources said that Sameer's statements to the probing agency nailed the controversial NCP leader landing him behind bars although Chhagan is claiming innocence saying Sameer was the brain behind all the illegal financial transactions. Sameer is already under custody.

The Prevention of Money Laundering Act, 2002 (PMLA) prescribes rigorous imprisonment from three years to seven years in case an individual is found guilty. Both NCP leaders will face action as per the provisions of the PMLA if they are convicted by a court of law, a senior ED official told Firstpost on condition of anonymity.

According to the ED official, the arrest of the former public works department minister happened as he allegedly refused to cooperate during questioning. The agency has also recorded his statement in the case. The official said Chhagan was questioned for 10 hours before he was arrested. The NCP leader was produced in a Mumbai court on Tuesday which sent him to a two-day ED custody.

The ED sources said large amounts of cash, allegedly laundered with the help of hawala operators, was pumped into shell companies floated by his nephew Sameer and son Pankaj Bhujbal. ED sources said that they have tracked over a dozen Kolkata-based companies which bought shares in companies fully owned and controlled by Bhujbals.

Money was later channeled through various companies to start projects like the Hex World in Kharghar. It is also learnt that bribe amount may have been used to float these companies. Bhujbal is being investigated for alleged corruption in contracts awarded for the construction of the Maharashtra Sadan in New Delhi. Other projects when he was at the helm of affairs at the public works department during the NCP-Congress government in Maharashtra have also come under the scanner.

The ED claims that part of the money allegedly received as kickbacks was parked abroad and routed into India through various shell companies located across the country.

Chhagan’s arrest is a setback to the party struggling to refurbish its public image after the major drubbing it received in the 2014 Lok Sabha and Assembly elections. Already, two senior party leaders Ajit Pawar and state party chief Sunil Tatkare are facing investigation by the Anti-Corruption Bureau (ACB) in a number of irrigation projects to the tune of Rs 70,000 crore.

There is little doubt that the arrest of the Yewala legislator under charges of alleged graft would heavily dent his image particularly in Nasik putting an indelible stain on his position within the party and outside it. His image as the Other Backward Community face of the NCP also took a severe hit following his arrest.

"Party chief Sharad Pawar and all other members stand by Bhujbal in this hour of crisis. We are here in full strength to support him," said NCP spokesperson Nawab Malik, alleging that Chhagan Bhujbal is being "victimised."

Social activist Anjali Damania said she was very happy that her efforts of four years against Chhagan Bhujbal's alleged corruption has been paid off. AAP national spokesperson Preeti Sharma Menon said, on 26 August 2013 the Aam Aadmi Party had filed complaints with detailed proof that Bhujbal, in his tenure as PWD minister, awarded contracts to builders and then received kickbacks.

"We gave detailed proof of every transaction in nine different cases, where kickbacks were received and money was laundered. None of the state agencies acted on our complaint, so we forced to file a PIL in the Bombay High Court. On 18 December 2014, Chief Justice Mohit Shah appointed an SIT comprising the Anti-Corruption Bureau and Enforcement Directorate.

"Time and again the court reprimanded the BJP-controlled ACB to act, but it continued to go in slow mode. Finally, the ED acted on HC's direction and first arrested Sameer Bhujbal and now Chhagan Bhujbal. Please note that they have been arrested under section 19 (1) of the PMLA Act — a money laundering charge and not on Maharashtra Sadan complaint filed by BJP MP Kirit Somaiya," she said.

Sources claimed that cash was carried in an ambulance to avoid suspicion.

Apart from Sameer Bhujbal, there are six others whose input to the ED, finally led to his arrest. The statements have also found place in Sameer Bhujbal's remand copy. The ED also recorded statements of various employees and co-directors of the web of companies that the Bhujbals involved themselves with.

1. Anjali Damania, social activist

On 26 August 2013, Anjali Damania on behalf of the Aam Aadmi Party had launched the first tirade against the NCP leader. By attaching detailed proof in the complaint, Damania alleged that Chhagan Bhujbal in his tenure as PWD minister of Maharashtra awarded contracts to builders in lieu of kickbacks. She also exposed a family-builder nexus involving the Bhujbals.

2. Sunil Karve, founder trustee of MET

Sunil Karve, a founder trustee of MET and a chartered accountant by profession, has filed a complaint before the Charity Commissioner alleging a fraud of Rs 177 crore at the institution. Although Karve was reportedly close with the Bhujbal family, he still went ahead and filed the PIL after quitting MET reportedly after a fallout with the Bhujbals that resulted in his ouster from the educational trust.

Karve accused Chhagan Bhujbal and his family members, who are among the trustees of MET, of misappropriating Rs 177 crore of the trust funds and misusing its office building at Bandra Reclamation in Mumbai. Karve, who co-founded MET in 1989 with Bhujbal, had earlier filed a complaint with the Economic Offences Wing of Mumbai Police, alleging that Bhujbal family had usurped an entire floor in the MET building, using it as a residence and also as the office of their furniture business. Karve also filed an application through his lawyer Sayaji Nangre before the Charity Commissioner to seek dismissal of Bhujbal, his wife Meena, Pankaj and nephew Sameer as trustees.

3. Sunil Naik, chartered accountant for Bhujbal Group

On 1 February, the ED arrested Sameer Bhujbal. Seeking his remand, the ED in its remand copy said, “Chartered accountant Sunil Naik deposed the involvement. Sameer Bhujbal’s chartered accountant, Sunil Naik, has given a statement in which he has admitted that he had contacted and proposed to market operators to take cash and provide cheques in the guise of share purchase on the instructions of Bhujbal. Chartered Accountant Sunil Naik deposed that shares of Parvesh Construction Pvt Ltd and Armstrong Energy Pvt Ltd fully owned and controlled by Bhujbals were sold to dubious entities against cash at unrealistic high premiums of Rs 990 per share and funds to the tune of Rs 75 crores and Rs 50 crores respectively were channeled.”.

4. Suresh Jajodia, market operator

“Suresh stated that as instructed by Sunil Naik, he arranged funds in the bank account of Parvesh Construction and Armstrong Energy against cash he received from MET (Mumbai Educational Trust) office of Bhujbals in Bandra and used to transfer it to his Kolkata contacts using hawala operators," the remand copy said.

5. Pravin Jain, controller of many Bhujbal firms

“Admitted that he had accepted cash from Naik and in turn arranged cheque payments in the bank accounts of Armstrong Energy in lieu of cash to the tune of Rs 10.50 crore.” His employee Prabhakar Sogam visited MET office on his instruction a numerous times and collected cash in bags.

6. Sanjiv Jain, financial consultant

The Kolkata-based financial consultant received approximately Rs 8 crore in cash from Naik for arranging cheque payments in the accounts of Parvesh Construction and Armstrong Energy in the guise of share purchase at high premiums.

7. Sameer Bhujbal, former MP and nephew of Chhagan Bhujbal

A trusted lieutenant of yore behind Chhagan Bhujbal's exponential growth in terms of assets and his meteoric rise in politics, Sameer Bhujbal often dragged his uncle into newer bouts of controversies. Arrested on 1 February this year by the ED for money laundering and corrupt practices, it is believed that the agency succeeded in cracking Sameer and made him spill the beans on the financial intricacies of the Bhujbal empire.

Prior to the arrest of the duo, a property war was already ensuing between the two Bhujbals—Chhagan and Sameer—as the latter wanted to take control and expand the Rs 2,500 crore worth Bhujbal empire. In his quest to wrest power from the senior Bhujbal, Sameer allegedly got involved in money laundering and launched non-existent firms in the names of many Bhujbal family members.

The length and breadth of Bhujbal empire

Former Maharashtra deputy chief minister Chhagan Bhujbal reportedly owns five bungalows in Nashik, 12 shops and flats in Mumbai, bungalows in Thane and Belapur in Navi Mumbai. In Mumbai, he and his family own flats at Worli, Mazgaon, Churchgate, Mahim, Dadar and Santa Cruz. The 65-acre bungalow with an adjoining helipad is located in Pune's Lonavla.

The 46,500 sq ft space in Nashik is called Bhujbal Farms. This property, which is a 25-room palace with gymnasiums and a full-sized swimming pool, is worth Rs 100 crore alone – a far cry from the Rs 22 crore that Bhujbal had listed as his total assets in his election affidavit.

The ACB records said that Bhujbal has a 2,000 sq ft flat and a Toyota car at Worli, a 600 sq ft flat in Mazgaon, a 1,200 sq ft mini-theatre in wife Meena's name at Manek Mahal in Churchgate, three floors in the Solitaire building in Santacruz, and a six-bedroom bungalow in Lonavla worth Rs 5 crore which has imported furniture and six service quarters and is built on property spread across 2.82 acres and equipped with a helipad and a huge garden.

With inputs from PTI