The slugfest between the government and Team Anna on the Lokpal bill clearly demonstrates that there exists a huge gap between the two sides in their respective understanding of the malaise of corruption, the need to eradicate corruption at all levels, the scope of coverage under Lokpal and the necessity of meting out quick and severe punishment to the guilty. As is often said that only the wearer knows where the shoe pinches, the government side ought to be excused for its ignorance because it isn’t at the receiving end of the pinching – rather it is either at the receiving end of the booty or defending the corrupt.

As one who has worked in the public sector for over three decades, let me demonstrate with one recent case in the high-profile PSU, Air India, how ineffective are the existing systems; how the corrupt and the corruption flourish with the honest left virtually helpless as mute spectators; thus warranting an urgent change in our systems if corruption and acts of wrongdoings have to be curbed. It can in effect be only through illustrative examples of such corrupt practices that the huge communication gap that exists today between the two sides can be bridged and policy makers can be given a better understanding of the need for an effective Lokpal.

Even as Air India was reeling under huge losses, a decision was taken that the airline needed 500 handheld DVD sets for the use of first-class and business-class passengers. The equipment is purchased at $3,000 a piece, as against the market price of $350. The system of tendering was done away with by declaring the item as proprietary. The equipment was ordered, received, sparingly used for only a couple of months on a few aircraft, and then dumped. Huge loss to the company was caused.

The vigilance department, existing in all PSUs to check corruption and ensure compliance of set procedures, is sounded of this purchase made in flagrant violation of rules. It conducts an enquiry, which takes over three years, and finds that the purchase was done in total violation of established norms. Air India had paid almost ten times the cost, the product was not a proprietary item, there was involvement of middlemen at all stages, and hence it was concluded that it was a blatant act of corruption.

After the files, documented with investigation reports, moved from Air India’s vigilance department to the central vigilance commission, a decision eventually gets taken by the CVC, India’s highest ranking watchdog against corruption, that a major penalty charge sheet ought to be issued to the officer involved. The charge sheet is issued but the chairman, as the competent authority, exercising his ‘judgement’ feels there is no case against the official concerned and exonerates him because the officer is due for retirement and the chairman wants him back as an advisor, post retirement. The chairman in doing so openly violates the vigilance manual which inter alia states that the response given by the charged official needs to be referred to the investigating agency, the vigilance department, and that if the chairman feels differently in a case in which the CVC has advised issuance of a major penalty charge sheet, the CVC’s office is required to be consulted prior to exoneration.  No such procedures were followed. Though the employees of the airline were naturally indignant at the outrageously partisan and unfair conduct of the chairman, there is little that anyone could do to undo the wrong. Might is right seems to be the guiding principle.

The chief vigilance officer of Air India, a senior IAS officer, was naturally livid at the violation of established norms in exonerating the corrupt officer. She wrote to the CVC protesting against the way the issue had been treated by the CMD. What good is the current vigilance mechanism serving in its present avatar if it cannot check such wrongdoings and pull up officers irrespective of the level at which they are if rules in place for checking corruption are flouted. A section of the media highlighted this too but does it make any difference in today’s environment? No, because most people have become insensitive to criticism and corruption has almost become part of life for many.

This example is by no means an isolated example. What does it demonstrate? The current systems allow the employees to indulge in acts of corruption if they wish to; allow the head of the institution to overrule the investigations of the vigilance department and to exonerate a guilty employee without being questioned; without being held accountable. Can corruption in government departments be checked and eliminated with existing systems and lack of accountability in place? Certainly not!

Existing systems lacking any teeth will only breed more corrupt people and hence the need for an effective Lokpal. Team Anna should, instead of seeking acceptance of their draft bill, present various illustrative scenarios of corruption and ask the government nominees to respond with the outline of the mechanism that their Lokpal draft bill will have to check such illustrated scenarios of corruption. An effective Lokpal bill can only be one which can root out corruption, the onus for which lies squarely and only with the government, with civil society backed by the media acting only as a pressure group to make the government act.

No wonder Air India is in mess if this is how it handles corrupt officials

Governance Now accessed the confidential letter AI vigilance officer wrote to CVC

VIGWR/RC9A/2010123                  
18th April, 2011

To,
Sri R. Srikumar
Vigilance Commissioner
Central Vigilance Commission
Satarkta Bhavan
GPO Complex, Block-A, INA
New Delhi

Sir,

Subject: Allegations of irregularities committed by S/Sri Amod Sharma, ex-Functional Director & V. Srikrishnan, ex-Executive Director – HQrs. in procurement of PEA Players  

1. This refers to the Commission’s advice rendered vide O.M. No.011/TCA/012-122447 dated 21st March, 2011 on the above subject, based on which Charge-sheet Ref.No.  HQ/72-21/30269 dated 25th March, 2011 was issued to Sri V. Srikrishnan, ex- HQrs by CMD – Air India as the Disciplinary Authority. On receipt of the reply from Sri V. Srikrishnan, CMD – Air India has issued Order No. HQ/81-3/3091 dated 30th March, 2011 (Copy enclosed) exonerating Sri V. Srikrishnan of all the charges levelled against him vide the abovementioned Charge-sheet. While the Order exonerating Sri Srikrishnan is dated 30th March, 2011 – a day before his superannuation – it has been communicated to Air India Vigilance through Air India Headquarters only on 12th April, 2011.

2. It is pertinent to mention here that the Order exonerating the accused is vaguely worded and is not a speaking Order as it only states that the case “is mainly against Sri Amod Sharma” and that Sri V. Srikrishnan “has not been involved in the charges levelled against him” and that he (Sri Srikrishnan) “is not responsible for the acts” referred to in the Charge-sheet. A copy of the reply of the charged officer has also not been provided to Air India Vigilance.

3. To recapitulate in brief:
(i) The case involves the presence of middlemen at various stages in the procurement of the 500 Portable Entertainment Assistant (Portable Digital Players) and support equipment at a cost of USD 16,60,000/-. Sri V. Srikrishnan, the then Director - Materials Management Department, along with Sri V. Thulasidas, the then CMD, initiated action for and agreed to allow M/s. North Star Aerospace to present their product to Air India.   Sri Amod Sharma, the then Director – Inflight Services was involved only from the time (rather, after) a trial run of the product was agreed to.

(ii) The procurement was made from M/s. North Star Aerospace INC.  who were neither the manufacturers nor the authorized representatives acting on behalf of the manufacturers. Sri V. Srikrishnan as the Person i/c. of Procurement and Sri Amod Sharma as the Head of Inflight Services corresponded with these Firms/persons in the USA and India and procures the equipment at an exorbitant cost – that too, on proprietary basis, without any laid down tender procedures.

(iii) As per the existing Rules for procurement, while the right to declare a procurement on proprietary basis rent rests with the User Department, the Materials Management Department are required to inform the User Department about the existence of alternatives in the market.   Sri Srikrishnan, despite knowledge of alternatives products existing in the market, did not pass on the information to Sri Amod Sharma.

(iv) It is also a fact that one of the middlemen Firms who facilitated this procurement – M/s. India Duty Free Services – had on an earlier occasion in 2007 supplied Inflight Concessionaire products to Air India, procurement of which was investigated at the time and, based on the consequential advice of the CVC in the matter, Sri V. Srikrishnan was also shifted out of the Materials Management Department.

4. As can be seen from the above, Sri V. Srikrishnan is the prime accused responsible for commission of the irregularities while Sri Amod Sharma and Sri V. Thulasidas are co-accused. In fact, a draft Order for deemed continuation of the services of Sri Srikrishnan with AI in order to facilitate the above pending departmental action beyond his retirement from the services of the Company on 31st March, 2011 was forwarded to the CMD on 29th March, 2011 for issue to Sri V. Srikrishnan. AI Vigilance have, however, not received confirmation of services of the said Order on Sri Srikrishnan as on date.

5. The procedure enumerated in the Vigilance Manual, as well as the Special Chapter on Vigilance Management in PSEs, makes consultation with the CVC mandatory in cases where the Disciplinary Authority, after receipt of the CVC’s advice, proceeds with the Departmental action – with the consultation being required before  the Disciplinary Authority decides to drop the charges.

The relevant extracts of the Vigilance Manual Vol, I Chapter – X state that

22.1 …The scheme of consultation with the Commission in respect of Major Penalty cases pertaining to such officers (under CVC’s jurisdiction) envisages consulation with the Commission at two stages. The first stage of consultation arises when initiating disciplinary proceedings, while second conclusion of the proceedings. It follows, therefore, that the Commission should also be consulted for second stage advice in cases where the Disciplinary Authority, having initiated action for Major Penalty proceedings, proposes to close the case on receipt of statement of defence.

22.2 The Disciplinary Authority has the inherent power to review and modify the articles of charge or drop some of the charges or all the charges after the receipt and examination of the written statement of defence submitted by the accused ... the exercise of the powers to drop the charges after consideration of the written statement of defence will be subject to the following condition:

(i) In cases arising out of investigation by the CBI …

(ii) The CVC should be consulted where the disciplinary proceedings were initiated on the advice of the Commission and the intention is to drop any of or all the charges.

22.3. …A second reference to  the Commission is also required to be made for reconsideration of its advice in cases in which the Disciplinary Authority proposes to disagree with its advice. In many cases the Disciplinary Authority ‘decides’ to disagree with the Commission and then sends the case back to the Commission for reconsideration of its advice. This is not quite in order and requests for reconsideration should be made at a stage prior to the final decision, for once the Competent Authority has ‘decided’ or ‘resolved’ to differ with the Commission, the case will be treated as one of non-acceptance of the Commission’s advice.

6. In the light of the above facts, the case is submitted to the Commission for taking a view in the matter.

Yours faithfully,
(Urmila Subbarao)
Chief Vigilance Officer                            
Air India Limited

Encl: As above