HEY SCAM – HEY RAM
Contents: Ten examples of recent scams in India - Discussion of recent
examples - The Prevention of Corruption Act 1988 and Indian Penal
Code – Typology of Corruption - Consequences of Corruption –
Citizen‟s Charter - Anti-corruption movement of Anna Hazare
10 Examples of Corruption Scams in India
Since the 1990s several scams and big corruption cases have been
unearthed in India. It is seen that these scams were the biggest and most
damaging to the country and its citizens alike.
In our daily life, most of us must have been a witness to or a victim of
the corruption thriving in some or the other part of our country. It could
be in the form of a taxi-driver manipulating the meter to jack-up the
reading or a government officer taking bribery to promptly transfer your
file to the next department or even yourself offering bribe to a traffic
police on breaking a signal.
An average Indian citizen is hard working and diligent, but it is the
people in charge of the system (The Babus) or with whom the power
rests, that act tough as a cancer spreading and slowing down progress.
But, somewhere down the line, we ourselves are responsible for
allowing and being taken for a ride by these people, aren‟t we?
However, it is during a multi-thousand crore scam, that a tax-payer
actually realizes the heartburn of being cheated from his valued
contribution of funds towards the development and well-being of the
nation. But, that‟s what a scam, be it big or small, means – the act of
swindling by some fraudulent scheme or action.
Ten Scams in twenty years of free India
1) 2G Spectrum Scam
We have had a number of scams in India; but none bigger than the scam
involving the process of allocating unified access service licenses. At the
heart of this Rs.1.76-lakh crore worth of scam is the former Telecom
minister A Raja – who according to the CAG, has evaded norms at every
level as he carried out the dubious 2G license awards in 2008 at a throw-
away price which were pegged at 2001 prices.
2) Commonwealth Games Scam
Another feather in the cap of Indian scandal list is Commonwealth
Games loot. Yes, literally a loot! Even before the long awaited sporting
bonanza could see the day of light, the grand event was soaked in the
allegations of corruption. It is estimated that out of Rs. 70000 crore
spent on the Games, only half the said amount was spent on Indian
The Central Vigilance Commission, involved in probing the alleged
corruption in various Commonwealth Games-related projects, has found
discrepancies in tenders – like payment to non-existent parties, will-ful
delays in execution of contracts, over-inflated price and bungling in
purchase of equipment through tendering – and misappropriation of
3) Telgi Scam
As they say, every scam must have something unique in it to make
money out of it in an unscrupulous manner- and Telgi scam had all the
suspense and drama that the scandal needed to thrive and be busted.
Abdul Karim Telgi had mastered the art of forgery in printing duplicate
stamp papers and sold them to banks and other institutions. The tentacles
of the fake stamp and stamp paper case had penetrated 12 states and was
estimated at a whooping Rs. 20000 crore plus. The Telgi clearly had a
lot of support from government departments that were responsible for
the production and sale of high security stamps.
4) Satyam Scam
The scam at Satyam Computer Services is something that will shatter the
peace and tranquillity of Indian investors and shareholder community
beyond repair. Satyam is the biggest fraud in the corporate history to the
tune of Rs. 14000 crore.
The company‟s disgraced former chairman Ramalinga Raju kept
everyone in the dark for a decade by fudging the books of accounts for
several years and inflating revenues and profit figures of Satyam.
Finally, the company was taken over by the Tech Mahindra which has
done wonderfully well to revive the brand Satyam.
5) Bofors Scam
The Bofors scandal is known as the hallmark of Indian corruption. The
Bofors scam was a major corruption scandal in India in the 1980s; when
the then PM Rajiv Gandhi and several others including a powerful NRI
family named the Hindujas, were accused of receiving kickbacks from
Bofors AB for winning a bid to supply India‟s 155 mm field howitzer.
The Swedish State Radio had broadcast a startling report about an
undercover operation carried out by Bofors, Sweden‟s biggest arms
manufacturer, whereby $16 million were allegedly paid to members of
PM Rajiv Gandhi‟s Congress.
Most of all, the Bofors scam had a strong emotional appeal because it
was a scam related to the defense services and India‟s security interests.
6) The Fodder Scam
If you haven‟t heard of Bihar‟s fodder scam of 1996, you might still be
able to recognize it by the name of “Chara Ghotala,” as it is popularly
known in the vernacular language.
In this corruption scandal worth Rs.900 crore, an unholy nexus was
traced involved in fabrication of “vast herds of fictitious livestock” for
which fodder, medicine and animal husbandry equipment was
7) The Hawala Scandal
The Hawala case to the tune of $18 million bribery scandal, which came
in the open in 1996, involved payments allegedly received by country‟s
leading politicians through hawala brokers. From the list of those
accused also included Lal Krishna Advani who was then the Leader of
Thus, for the first time in Indian politics, it gave a feeling of open loot
all around the public, involving all the major political players being
accused of having accepted bribes and also alleged connections about
payments being channelled to Hizbul Mujahideen militants in Kashmir.
8) IPL Scam
Well, I am running out of time and space over here. The list of scandals
in India is just not ending and becoming grave by every decade. Most of
us are aware about the recent scam in IPL and embezzlement with
respect to bidding for various franchisees. The scandal already claimed
the portfolios of two big-wigs in the form of Shashi Tharoor and former
IPL chief Lalit Modi.
9) Harshad Mehta & 10) Ketan Parekh Stock Market Scam
Although not corruption scams, these have affected many people. There
is no way that the investor community could forget the unfortunate Rs.
4000 crore Harshad Mehta scam and over Rs. 1000 crore Ketan Parekh
scam which eroded the shareholders wealth in form of big market jolt.
Discussion of recent examples of misappropriation of public funds /
trust and remedies:
Barely had the dust from the Commonwealth Games exposes
settled, which brought infamy to the country before the international
community, the country has been rocked by a series of scams which has
undermined public trust like never before. What is interesting is that
corruption has become a common malaise afflicting all political parties
and no party can claim the moral high ground.
The season of scams has once again set over us in India. Every week
there is a new scam which is unearthed by the media who then go to
town with the stories. But this scam season should even hit the hardest
cynic and make him think about where as a nation we are headed. All
and sundry have been implicated in these scams from the usual suspects
like our politicians and bureaucrats to the more unusual suspects like
senior Defence personnel and still every day we hear new names coming
up in the context of these scams.
The season was kicked off by the now “world famous” Common
Wealth Games Scam where a certain Mr.Kalmadi and his lackeys made
off with crores of rupees meant to be spent on the games. According to
estimates an amount of almost 70,000 crores was spent on the games and
it is hard to imagine where all this money went.
Then we have the Adarsh Housing Society Scam where flats
and apartments meant to be given to the relatives of soldiers who gave
up their lives fighting for the country in the Kargil war. But instead these
flats and apartments in high end South Mumbai landed in the hands of
politicians, babus and senior Defence officers.
And then of course we have the 3G scam with telecom licenses
for operating 3G services in the country were given out at a much lower
than the market rate. The total revenue loss caused to the Government
due to this underselling is already estimated to run into thousands of
The media of course took up these issues and shouted at the top of
its voices. The Government finally decided to act. Kalmadi lost his place
as a Secretary in the Congress, Ashok Chavan resigned as the Chief
Minister of Maharashtra and now the Telecom minister A Raja has also
put in his papers after he was forced to resign. And now some
committees will sit on these scams and after 10 years submit a 10,000
page report which nobody would care about.
The main problem we have is that just by giving up their public
offices these politicians feel they have now come clean. The question
when will people like these actually spend some quality jail time and
their assets are confiscated? In China they hang people for corruption
and in India they just give up public office and all is hunky dory. It is
time that the common man stood up and made his voice heard and these
politicians are actually punished.
The latest scam to shock the country is the 2G Spectrum allocation,
which has been called the mother of all scams causing a combined loss
to the exchequer of Rs 60,000 crores. Though the controversy has cost
Telecom Minister A Raja his job, as he was forced to resign, it continues
to rock the parliament and the nation with Prime Minister Dr Manmohan
Singh making a fervent appeal to the opposition to forget the issue and
let the parliament function in the true spirit of democracy.
A few weeks ago, the chief minister of Maharashtra state
Ashok Chavan resigned after his involvement in Adarsh housing scam, a
land grab in the name of Kargil war heroes.
Another important state in the country too is convulsed by
corruption scandal and this one is ruled by the opposition Bharatiya
Janata Party. Karnataka Chief Minister B S Yeddyurappa has been
facing allegations of nepotism and cronyism in favouring close family
members with allotments of plots of land at prices much lower than
market rates. He is continuing in office in defiance of his party.
Saying that corruption is deep-rooted in India will be an
understatement. Once the dust settles on the current scandals, new ones
will break out, with equal vehemence and of same size.
The main reason for the sordid state of affairs is that the country
has no serious laws to punish the guilty. Resignation from the ministerial
position is considered the biggest punishment, while the culprits loot
millions of dollars and are left to enjoy them in peace.
Sonia Gandhi, the president of the ruling Congress party summed
up the mood of the nation when she said a few days ago that though the
economy is dynamic, the country‟s moral universe seems to be
shrinking. “Graft and greed are on the rise. The principles on which
independent India was founded, for which a generation of great leaders
fought and sacrificed their all, are in danger of being negated,” she said.
India is amongst the most corrupt countries of the world with a score of
only 2.7 out of 10 and ranks 71st amongst 102 countries in 2002.
CORRUPTION PERCEPTION INDEX AND RANK OF INDIA, 1995-
Indians think that corruption cannot be eliminated in India – at
least not in their lifetime. This pessimistic and cynical perception of the
people is largely an outcome of confusing corruption with all kinds of
illegal actions and activities like dishonesty, cheating, duping etc. Most
illegal actions, many of which are private actions, are confused with
The Prevention of Corruption Act 1988 and Indian Penal Code
clearly distinguishes between corruption indulged by public servants for
private gains and illegal actions by individuals.
There are separate Acts in India for dealing with different kinds
of illegal actions of private individuals. For example, if a public servant
amasses wealth disproportionate to his known sources of income then he
can be tried under Prevention of Corruption Act 1988. However, if a
businessperson amasses wealth disproportionate to his known source of
income he will be dealt under Income Tax Act for concealing his income
and not under Prevention of Corruption Act.
TYPOLOGY OF CORRUPTION
Corruption is defined as the use of public office for private gains.
Scales of corruption can be Grand, Middling or Petty and payment of
bribes can be due to collusion between the bribe taker and the bribe
giver, due to coercion or even anticipatory.
Existence of corruption implies that there are corrupt people, there
are also corrupt practices, and there is a corrupt system. Therefore, all
the three have to be fought simultaneously to eliminate the vice of
The present system provides for taking on the corrupt persons
through a legal mechanism, which has not been found to be very
effective. Many corrupt practices fall outside the purview of existing
laws and need to be tackled by people themselves.
The responsibility for dealing with corrupt people, corrupt
practices and corrupt systems devolves equally on individuals, civil
society institutions, legislature, executive, and the judiciary.
Corruption as an issue is receiving focused attention due to several
scams exposed in recent times and democracy in India has a strong
capability for debate now due to an independent press, electronic media
and the information and communication technology revolution. India
has delivered well on reforms and aroused economic aspirations for
betterment have led to political demands for politicians to deliver yet
more. This suggests that voters will look to vote for the politicians who
can deliver growth.
On corruption, Jagadish Bhagavati, an eminent development
economist, has said that the menace can be dealt by institutional reforms
and use of science. As an example, he cited the government initiative of
giving electronic identity cards to the poor. He said Nandan Nilekani is
engaged in "arguably the most important innovative reform in recent
years by creating a national database of identity details of Indian
citizens. This should take the political corruption out of the Public
Distribution System and in the Employment Guarantee Scheme.
As per perception of the people, Police is the most corrupt
sector. However, the impact of corruption is on a much larger scale in
the Health and Education Sectors involving far greater number of
Corruption in Health and Education deprives people of these
basic facilities and affects human development. These are, co-relates of
Human Development. Cross country data of 102 countries show that
there is a high rank correlation (0.788) as well as coefficient of
correlation (0.766) between Human Development Index (HDI) and
Corruption Perception Index (CPI). Countries with low scores in CPI
have low HDI.
Civil Society organisations can raise awareness among the
populace and act as catalysts. Cause for corruption is certainly not
continuing „low salary‟ of those indulging in corruption. It is the lack of
effective deterrence in the form of punishment to the corrupt and the
lack of adequate supervision.
The fact that money is being demanded directly and openly by the
corrupt is a clear indication that the corrupt persons are confident that no
worthwhile action can be taken against them. This reflects the fact that
those guilty of corruption do not expect to be hauled up. The existing
systems for identifying the corrupt and punishing them appear
ineffective and provide no deterrence to those indulging in corrupt
Perceptions at best are indicative of the existing malaise in the
systems. However, for prioritizing issues, formulations of policies and
planning strategies hard data is a requirement. Policies and programs
should not be based on perceptions alone.
Consequences of Corruption
Corruption is found to be one of the most damaging consequences of
poor governance characterized by lack of both transparency and
accountability. Corruption lowers investment and hinders economic
growth and human development by limiting access to basic social
services as well as increasing the cost of their delivery. It also increases
poverty, subverts the financial system,, and undermines the legitimacy
of the state. Thus, corruption is anti-poor, antidevelopment, anti-growth,
anti-investment, and inequitable. The cost of corruption to a nation is
At present, 19.5 million people hold public office with central and
state governments, quasi-central and quasi-state institutions, and rural
and urban local bodies spread over 200,000 establishments and offices
all over India.
At present, the perception is that government can eradicate
corruption and responsibility for eradicating corruption
is that of government alone. However, in view of the kind of corruption
and the framework that we have in India, it is very clear that government
alone cannot eradicate corruption. If the people and civil society
institutions remain indifferent and show helplessness in combating
corruption then it can never be eradicated or for matter that even
reduced. Thus, the responsibility and the onus of combating corruption
are as much of the people and the civil society institutions as that of the
Prevention of Corruption Act 1988
To deal with corruption amongst public servants India enacted
Prevention of Corruption Act 1988 (PCA 1988), replacing Prevention of
Corruption Act 1947.
PCA 1988 incorporates provisions of chapter IX of the Indian
Penal Code to deal with Public servants and those who abet them by
way of criminal misconduct and provides to enable attachment of their
ill-gotten wealth obtained through corrupt means. This act also widens
the scope of definition of Public servants.
Public servant means any person in the service, pay of the
government, or remunerated by the government by fees or commission
for the performance of any public duty. Public duty means a duty in the
discharge of which the state, the public, or the community at large has an
interest. The „State‟ includes a corporation established by or under a
central, provincial or state act or an authority or a body owned or
controlled or aided by the government or a government company
defined in section 617 of the Company‟s Act 1956. In India in addition
to a large number of health and educational institutions, the government
also aids many other kinds of organisations. Hence, the employees of
such bodies are also covered by this act.
Normally corruption is defined as using public office for private
gains. In PCA 1988 Public Servant and Public duty have very wide
definitions covering every person who is in the actual possession of the
situation of a public servant and discharging public duty which the state,
public or the community at large has a interest. Persons holding various
public offices are public servants, whether appointed by the government
The concept of Citizen Charters has been introduced to improve the
quality of public services. It ensures accountability, transparency and
quality of services provided by various government organistions. It
enables citizens to avail of services with minimum hassle, in reasonable
time, and at a minimum cost. Effective implementation of Citizens
Charters will go a long way in controlling corruption. The Government
of India has launched an ambitious programme for formulation and
implementation of Citizens Charters in all government departments.
To oversee the implementation and diffusion of these Charters, there
must be Watch/ Monitoring Committees consisting of both public
service providers and service receivers.
Anti-corruption movement of Anna Hazare
Model Village as contemplated by Gandhiji was brought in reality by
Shri Annaji at Ralegan Siddhi by his dedication. “Late Shri Achyutrao
Patwardhan, the great freedom fighter, suggested to the government of
Maharashtra that to commemorate the golden jubilee of Bharat Chhodo
Andolan, it would be most befitting to create model villages like
Ralegan Siddhi in every tehsil of the state. The government accepted this
suggestion and declared to implement “Adarsh Gaon Yojana”. The
Government entrusted this responsibility to him and Adarsha Gaon
Yojana was started under his leadership. He travelled whole of
Maharashtra and selected 300 villages to implement this scheme. While
working in this scheme he realised that development is getting hampered
due to planned corruption in Government machinery and he decided to
fight against this corruption. He gave evidence against two ministers
who had amassed wealth disproportionate to their income.
However since the Govt was passive about this he started agitation and
undertook fast for l0 days. Chief Minister intervened and he deleted
these two ministers from ministry and appointed an Inquiry
Commission. The Commission held both the ministers guilty but to save
them the Govt appointed another commission who discharged them from
the allegations. Though the ministers were discharged from the
allegations, they had to lose their ministership which is the success of
Mr.Hazare's agitation. Mr. Hazare's gave evidence of corruption by
Social Welfare Minister to the then Chief Minister. On 3lst July l999 the
Chief Minister informed him that inquiry is being instituted about the
charges leveled by him. He had given an interview to a local daily
regarding this inquiry and based on this interview the concerned minister
had filed a case in the court against Mr. Hazare for defamation. He was
held guilty by the Court and the court had asked him to give an
undertaking that he will not make such allegations in future. He refused
to give such undertaking and preferred to go jail for 3 months as ordered
by the court. He told the court that He was willing to give his life for
truth. His punishment created commotion in public and scores of people
started visiting Yerawada Jail. He wanted to complete his jail term but to
give respect to the public feelings he accepted his release. In l992
Gandhji had told the court that if court feels that his actions for the
freedom of the country are considered as anti-government activities he
was willing to undergo any punishment .Similarly he did not give bond
to the court and accepted punishment. He did not prefer any appeal
against the court order immediately but due to public pressure he later
made an appeal which was upheld by the Higher Court and rejected the
suit of minister. Mr. Hazare asked the Govt. to conduct the inquiry
against the minister which is still on. In the regime of coalition
Government of Congress and National Congress Party, He had
forwarded evidence of corruption about 4 ministers and had asked the
Government to conduct inquiry. One of the ministers had made
allegations about corruption in the institutions in which he was
associated. Since there was no action from the Govt. he undertook fast
for 9 days in August 2003 at Azad Maidan. The minister concerned also
started agitation at Azad Maidan in Mumbai. At last the Government
relented and Retired Supreme Court Judge Shri P.B. Sawant was
appointed to conduct the inquiry.
The commission conducted the inquiry and sent its report to Govt. on
22nd Februrary. In the report the commission had observed ministers
guilty and had held Mr. Hazare also guilty for irregularities but not a
single charge of corruption was proved against him. Mr. Hazare has
offered the Government that it should take action against him as well as
the ministers based on the findings of the enquiry commissions. Though
Govt has not taken any action on the Commission's report three
ministers had to go and this is a big achievement of his agitation against
corruption. He felt that corruption will not stop merely by taking action
against a few officers and ministers and it is necessary that a change
should be brought about in the system. He believes that unless
decentralization of power takes place the system will not change. In
order to bring change in the system he felt that information should be
made available to people regarding Govt.'s actions which was not being
provided to people on the ground of secrecy. Here again he decided to
follow Gandhiji's path and started Maun Vrat and later fast unto death.
This brought pressure on the Govt. and both the Central as well as State
Governments have enacted Right to Information Act. His whole life and
work is based on Gandhian philosophy.