In a landmark judgment which will have far-reaching effect on Uttar Pradesh administration, the Allahabad high court has directed the enforcement directorate (ED) and directorate of revenue intelligence (DRI) to coordinate with the Central Bureau of Investigation (CBI) to probe into the biggest-ever food grain scam in the country running into hundreds of crores of rupees.

The order came last Friday, after a series of hearings by the high court on a public interest litigation (PIL) filed by a lawyer, Vishwanath Chaturvedi. In the PIL, the petitioner maintained that since 2002 the food grains meant for various welfare schemes were diverted and sold off in large quantity in the market.

In some cases, the stock of food grains meant for schemes like food for work, Jawahar Rojgar Yojna and mid-day meal was lifted by brokers and exported to Bangladesh and Nepal through the railways. The magnitude of the scam can be assessed from the fact that the Economic Offences Wing (EOW) of the state police has estimated the scam to be running into Rs 35,000 crore from 2002-2007.

Given the size of the scam, the Allahabad high court gave a specific direction to the centre and the state government to assist the CBI in conducting the probe and exposing its real dimensions. The court has also waived the formality of seeking approval of the state government before prosecuting any government servant.

What is most significant is the observation of the court which clearly defined that the acts of corruption by an officer cannot be categorised as “official duty”.  As a result, the high court’s order specified that the permission for prosecution against all officers in the state would be deemed to be automatically granted if pendency exceeds three months. The order is expected to open a pandora’s box for the UP bureaucracy which has been sitting over the files seeking permission to proceed against corrupt babus in hundreds of cases.

The high court order has also set the guidelines for the union government and the state government to amend the Prevention of Corruption Act in such a manner as to facilitate proceedings against officials involved in corruption cases. This is the first order of its kind by a high court which has sought to amend the PCA to make it more effective through a central legislation.

Official sources admit that the order which seeks to complete the probe within the stipulated one year has left no scope for the state government to prevaricate on the issue. Earlier, the CBI has shown its inability to carry out the probe citing limitation of its resources as the reason. Though the CBI has taken up the task in right earnest after the court’s order, sources in the agency say that the magnitude of the scam will be even greater as the court has asked the agency to cover the scam till last year. “We are sure that the food grain scam is still continuing in UP,” said a senior official in the state government.

Related report:

ED to probe UP foodgrain scam

The Enforcement Directorate has decided to probe money laundering charges and foreign exchange violations in the multi-crore Uttar Pradesh foodgrain scam.

Official sources said the the Directorate's probe into the scam will bring under the scanner a number of officials associated with various schemes whereby grains meant for the poor were allegedly diverted to other states and sold in retail market besides making its way out of the country.

Sources said because of the magnitude of the scam, which is said to run into about Rs 35,000 crore, the ED will focus on violations of money laundering laws.

Also, since it is believed that the grains made its way to neighbouring countries like Nepal and Bangladesh, the government's apex agency for money laundering and foreign exchange violations cases, will also look into possible contraventions of Foreign Exchange Management Act (FEMA).

The Allahabad High Court in its order on December 3, had directed ED to proceed with search and seizure of assets, property, cash or kind meant for the welfare programmes being siphoned off by the officials. The court had also sought expeditious action under the PMLA and FEMA or any other law being in force.

The CBI had on November 3, 2008 registered nine cases in connection with the scam relating to diversion of foodgrains meant for the poor.

The Mayawati government, on assuming office had recommended a CBI probe into the foodgrain scam on December 1, 2007.

However, the CBI has now been directed by the Court to proceed with further enquiry not only with regard to Ballia, Lakhimpur and Sitapur but also with regard to Varanasi, Gonda and Lucknow districts.

The court had also directed that all those cases where the state agencies found that the foodgrains have been smuggled outside the state to other countries, they shall immediately refer such cases to the CBI for further investigation.

Earlier, after detection of a largescale bungling in supply of foodgrains under various schemes includng Antyodaya, Sampurana Gramin Swarojgar Yojna during 2002-2005, the then Samajwadi Party government had ordered a probe by the states Economic Offence Wing (EOW) in 2006.

The probe found that foodgrains meant for the poor was diverted to West Bengal from where it was smuggled to Bangladesh.

Besides fair price shops, many senior officers and some leading businessmen of West Bengal and even across the border were involved in the scam, sources said.

The food cell of the EOW had then lodged over 50 cases relating to foodscam in Ballia district alone, besides in other districts.

The SIT in its fact finding report has said there are evidence of the scam running in about 41 districts

Union Agriculture Minister Sharad Pawar put the onus on states to reach the foodgrains to the poor.

"My job is to procure and allot foodgrains to the states and it is states' job to allot to the needy people. So if the issue has been raised by court, then they will take appropriate decision... Let us wait and see what is the investigation report," he said stressing "it is the responsibility of the State".

CPI-M politburo member Sitaram Yechuri said, "Whether it is foodgrain scam in UP or some other scam in any other state, these scams were mushrooming all over. So the system needs to be cleansed and corrected and that can only be done if you have a Joint Parliamentary Committee to go into the whole thing."

D Raja of the CPI said, "It is for government to take into serious consideration and order for a correct probe because the rice meant for certain African countries did not reach there but rice was exported, was sold and someone in the middle made money, profit. So it needs to be investigated."

BJP considered the scam as a crime against people and demanded severe punishment to the accused.

"We see it as a crime against people, poorest of the poor. It needs to be investigated into...action should be taken against those who have done the major heartless crime.

Punishment should be severe so that the people don't think it is possible to do a crime like this and get away with it," BJP's spokesperson Nirmala Sitharaman said.

The party is in favour of comprehensive enquiry into this matter, she said.