The Madras High Court on Friday ordered the Tamil Nadu Police to look into the disappearance of 103 kg gold worth over Rs 43 crore from the Central Bureau of Investigation’s custody, rejecting its contention that “the prestige of the CBI would come down if investigation is done by the local police”, reported Live Law.
The court asked the state police’s Crime Branch to file a first information report in the case. “It may be an agni pariksha [trial by fire] for the CBI, but that cannot be helped,” it said. “If their hands are clean, like Sita, they may come out brighter. If not, they would have to face the music.”
Justice PN Prakash also rejected the central agency’s request to direct the CBI of the neighbouring state, or the National Investigation Agency to conduct the inquiry. “This court cannot subscribe to this view, because, the law does not sanction such an inference,” he said. “All policemen have to be trusted and it does not lie in the mouth of one to say that the CBI have special horns, whereas, the local police have only a tail.”
The Central Bureau of Investigation had seized the gold in connection with cases dating back to 2012 over allegations that officials of Minerals and Metals Trading Corporation of India in Chennai had made undue favours towards Surana Corporation Limited, which dealt in import of gold and silver.
The gold, amounting to 400.47 kg – and in the form of bars and ornaments –was seized by the CBI from Surana’s office in Chennai. The central agency claimed it had locked the company’s vault and handed over the keys to a special CBI court in the city, according to The Indian Express.
In September 2013, the CBI registered another case, saying that while the seized gold was not wanted in relation to the 2012 cases, it had found that Surana had imported the gold in violation of the Foreign Trade Policy. The agency requested that the seized gold be transferred from the first case to the fresh one, following which the court allowed the transfer of about 400 kg on record. However, there was no physical transfer of the gold, as it was already in the vault.
In 2015, the CBI filed its closure report in the second case. It said that there was no “adequate evidence forthcoming” in the matter. A special CBI court accepted the report, but directed that the seized gold be handed over to the Directorate General of Foreign Trade.
But, the Madras High Court set aside the order on a plea filed by Surana. The CBI opposed Surana’s petition, backed by the Ministry of Commerce and Industry, under which the DGFT falls.
Finally, in December 2019, the National Company Law Tribunal, which had been approached by the State Bank of India, ordered that the gold be handed over for distribution to the six banks that Surana owed money to. The SBI had initiated proceedings against Surana over non-payment of dues, and had found that the firm had pending loans amounting to Rs 1,160 crore, after which it moved the special CBI court seeking the seized gold.
When the CBI opened the vaults in the presence of the bank representatives in February this year, the gold was found to be 103.864 kg short – “to the great shock and surprise of all” – as the High Court noted, according to The Indian Express.
During the hearing on Friday, the CBI told the High Court that they had used a weighing machine to determine the quantity of gold seized at Surana’s office. It further argued that since the seals affixed by the agency on the company’s vaults were intact, the CBI could not be held liable for the missing gold.
The special public prosecutor suggested that there could have been discrepancy in the weight because the gold chains were weighed collectively at the time of the seizure, while in February, each item was weighed individually, using more sophisticated machines.
The High Court rejected all of the arguments, saying the allegations cannot be taken lightly, especially “when the difference is not a few grams, but, a whopping one lakh grams”. The court added that it was “unable to fathom” as to how there could be a discrepancy of more than 100 kg. “Gold will not diminish in weight like ganja by efflux,” it said.
It also observed that there were multiple possibilities to this case, which can be only ascertained with a proper investigation.
The court added:
“First, the alleged shortfall of 103.97 kgs of gold could be a genuine mistake as contended by the CBI, or secondly, the CBI officials, in collusion, with the panchas and others, may have illegally dealt with the gold while maintaining the weight of the gold as 400 kgs in the seizure mahazar, as a shortfall therein would have made Surana cry foul. The third possibility is that the CBI officials, in collusion with Surana and others, may have permitted Surana to deal with 100 and odd kgs of gold after effecting the seizure of 400 kgs. This court is not expressing any opinion on these possibilities. Suffice it to say that a free and fair investigation is, therefore, imperative to unearth the truth in this case.”— Justice PN Prakash, Live Law