full report on fodder scam

1. The Fodder Scam (Hindi: चारा घोटाला, chārā ghoṭālā) was a corruption
scandal that involved the embezzlement of about 9.4 billion (equivalent to
25 billion or US$410 million in 2014) from the government treasury of the
eastern Indian state of Bihar.[1] Among those implicated in the theft and
arrested were thenChief Minister of Bihar, Lalu Prasad Yadav, as well as
former Chief Minister, Jagannath Mishra.[2][3] The scandal led to the end of
Lalu's reign as Chief Minister. There is also allegation on Shivanand Tiwari of
receiving 1 crore and 60 lakh Rupees respectively from S.N. Sinha.
The theft spanned many years, and allegedly involved numerous Bihar state's
administrative and elected officials across multiple administrations of
the Indian National Congress and the Janata Dal parties. The corruption
scheme involved the fabrication of "vast herds of fictitious livestock" for which
fodder, medicines and animal husbandry equipment was supposedly
procured.[1][4] Although the scandal broke in 1996, the theft had been in
progress, and increased in size, for over two decades.[5] Besides the
magnitude and duration of the theft, the scam was and continues to be
covered in Indian media due to the extensive nexus between tenured
bureaucrats, elected politicians and businesspeople that it revealed,[6] and as
an example of the mafia raj that has penetrated several state-run economic
sectors in the country.
As of May 2013, the trial has completed in 44 cases out of a total of 53
cases.[7] More than 500 accused have been convicted and awarded
punishments by various courts.[8]
The scam[edit]
The scam had its origins in small-scale embezzlement by some government
employees submitting false expense reports, which grew in magnitude and

2. drew additional elements, such as politicians and businesses, over time, until
a full-fledged mafia had formed.[6] Jagannath Mishra, who served his first stint
as the chief minister of Bihar in the mid-1970s, was the earliest chief
minister to be accused of knowing involvement in the scam.[9]
In February 1985, the then Comptroller and Auditor General of India, T.N.
Chaturvedi, took notice of delayed monthly account submissions by the Bihar
state treasury and departments and wrote to the then Bihar chief minister,
Chandrashekhar Singh, warning him that this could be indicative of temporary
embezzlement.[10] This initiated a continuous chain of closer scrutiny and
warnings by Principal Accountant Generals (PAGs) and CAGs to the Bihar
government across the tenures of multiple chief ministers (cutting across party
affiliations), but the warnings were ignored in a manner that was suggestive of
a pattern by extremely senior political and bureaucratic officials in the Bihar
government.[11] In 1992, Bidhu Bhushan Dvivedi, a police inspector with the
state's anti-corruption vigilance unit submitted a report outlining the fodder
scam and likely involvement at the chief ministerial level to the director
general of the same vigilance unit, G. Narayan.[12][13] In alleged reprisal, Dvivedi
was transferred out of the vigilance unit to a different branch of the
administration, and then suspended from his position. He was later to be a
witness as corruption cases relating to the scam went to trial, and reinstated
by order of the Jharkhand High Court.
Exposure and investigation[edit]

3. Laloo Prasad Yadav, then chief minister ofBihar, was a prime accused in the fodder scam
investigation.
Bihar Veterinary Association for the first time exposed Animal Husbandry
Mafia in its 1985 Press Conference. In 1990 the executive committee of Bihar
Veterinary Association was changed and Dr R K Rana was made the General
Secretary of BVA . Once the mafia had control over the association, they went
all guns blazing. At that point Dr. Dharmendra Sinha and Dr. Biresh Prasad
Sinha ( The Ex-office bearers of BVA) started collecting and gathering
information against this whole unethical practice of Mafia. They exposed this
to all the political guns of Bihar. Among all these political guns were Sushil
Kumar Modi who initiated the whole episode after it was broken out by Amit
Khare. On 27 January 1996, the deputy commissioner of West
Singhbhum district, Amit Khare, acted on information to conduct a raid on the
offices of the animal husbandry department in the town of Chaibasa in the
district under his authority. The documents his team seized, and went public
with, conclusively indicated large-scale embezzlement by an organised mafia
of officials and business people. The news of fodder scam was first broken out
by Indian journalist Ravi S Jha, who working with the Asian Age then in
Calcutta, named the then Bihar Chief Minister of having implicit involvement in
the scam. Based on evidence collected by him from Chaibasa, Jha not only

4. found out widespread involvement of Bihar government machinery in the
scam, he even mentioned how earlier governments too were taking
advantage of a shoddy system, where top government officials along with the
ministers were flouting norms to make money illegally. Jha, an Associate
Director of Public Affairs, is currently working with anti-corruption crusader
and good governance promoter Rajeev Chandrasekhar, the Rajya Sabha
Member of Parliament.[11] Laloo ordered the constitution of a committee to
probe the irregularities.[14] There were fears that state police, which is
accountable to the state administration, and the probe committee would not
investigate the case vigorously, and demands were raised to transfer the case
to the Central Bureau of Investigation (CBI), which is under federal rather than
state jurisdiction. Allegations were also made that several of the probe
committee members were themselves complicit in the scam.[14] A public
interest litigation was filed with the Supreme Court of India, which led to the
court's involvement,[14] and based on the ultimate directions issued by the
supreme court, on March 1996, the Bihar High Courtordered that the case be
handed over to the CBI.[15]
An inquiry by the CBI began and, within days, the CBI filed a submission to
the High Court that Bihar officials and legislators were blocking access to
documents that could reveal the existence of a politician-official-business
mafia nexus at work.[16] Some legislators of the Bihar Legislative
Council responded by claiming the court had been misinformed by the CBI
and initiating a privilege motion to discuss possible action against senior
figures in the regional headquarters of the CBI, which could proceed similar to
a contempt of court proceeding and result in stalling the investigation or even
prosecution of the named CBI officials.[16] However, U. N. Biswas, the regional
CBI director, and the other officials tendered an unqualified apology to the

5. Legislative Council, the privilege motion was dropped, and the CBI probe
continued.[16] As the investigation proceeded, the CBI unearthed linkages to
the serving chief minister of Bihar, Laloo Prasad Yadav and, on 10 May 1997,
made a formal request to the federally-appointed Governor of Bihar to
prosecute Laloo (who is often referred by his first name in Indian media).[17] On
the same day, a businessman, Harish Khandelwal, who was one of the
accused was found dead on train tracks with a note that stated that he was
being coerced by the CBI to turn witness for the prosecution.[17] The CBI
rejected the charge and its local director, U. N. Biswas, kept the appeal to the
governor in place.[13][17] An Income Tax Investigation also blamed Laloo for the
scam.
Path to prosecution[edit]
A few days of uncertainty followed the CBI's request to the state governor to
prosecute the chief minister. The governor, A. R. Kidwai, was accountable to
the federal government, and had already stated that he would need to be
satisfied that strong evidence against Laloo existed before he would permit a
formal indictment to proceed.[18] The federal government, led by newly
appointed prime ministerInder Kumar Gujral who had just succeeded the
short-lived government of the previous prime minister HD Deve Gowda,
consisted of a coalition that depended on support from federal legislators
affiliated with Laloo for its survival.[13][19] It was also unclear why the CBI had
sought the governor's consent in the first place and, when the High Court
demanded to know why it was being sought, the CBI stated that it was a
"precautionary measure."[20] The High Court, questioning the tactic, warned
that it would allow some time for the permission to transpire, but if it sensed a
delay, it would force a prosecution on its own authority.[20]

6. On 17 June, the governor gave permission for Laloo and others to be
prosecuted.[21] Five senior Bihar government officials (Mahesh Prasad, science
and technology secretary; K. Arumugam, labour secretary; Beck Julius,
animal husbandry department secretary; Phoolchand Singh, former finance
secretary; Ramraj Ram, former AHD director), the first 4 of whom
were IAS officers, were taken into judicial custody on the same day.[22][23] The
CBI also began preparing a chargesheet against Laloo to be filed in a special
court. Expecting to be accused and imprisoned, Laloo filed an anticipatory
bailpetition, which the CBI opposed in a deposition to the court, listing the
evidence against Laloo.[24] Also, on 21 June, fearing that evidence and
documentation that might prove essential in further exposing the scam were
being destroyed, the CBI conducted raids on Laloo's residence and those of
some relatives suspected of complicity.[25]
On 23 June, the CBI filed chargesheets against Laloo and 55 other co-accused,[
26] including Chandradeo Prasad Verma (a former union
minister), Jagannath Mishra (former Bihar chief minister), two members of
Laloo's cabinet (Bhola Ram Toofani and Vidya Sagar Nishad), three Bihar
state assembly legislators (RK Rana of the Janata Dal, Jagdish Sharma of
the Congress party, and Dhruv Bhagat of the Bharatiya Janata Party) and
some current and former IAS officers (including the 4 who were already in
custody).[23] Mishra was granted anticipatory bail by the Bihar state High
Court.[27] Laloo's anticipatory bail petition, however, was rejected by the same
court, and he appealed to the Supreme Court, which resulted in a final denial
of bail on 29 July.[26] On the same day, Bihar state police were ordered to
arrest him.[28] The next day, he was jailed.[29] Later, the Bihar Director General
of Police, SK Saxena, justified the one-day delay in arresting Laloo by stating

7. in court that "any precipitate action would have led to police firing and killing of
a large number of people."[30]
End of Laloo's chief ministership[edit]
As it became evident that Laloo would be engulfed in the scandal and its
prosecution, demands for him to be removed from the chief ministership had
gained momentum both from other parties,[31][32] as well as within Laloo's own
party, the Janata Dal.[33] On 5 July, Laloo formally parted ways with the Janata
Dal and formed his own party, the Rashtriya Janata Dal (or RJD), taking with
him virtually all the Janata Dal legislators in the Bihar state assembly,[34] and
winning a vote of confidence in the state assembly a few days later.[35] The
RJD continued to support the coalition federal government, however.[34] With
demands for his resignation continuing to mount, on 25 July, Laloo resigned
from his position, but was able to install his wife, Rabri Devi as the new chief
minister on the same day. On 28 July 1997, Rabri's new government won
another vote of confidence in the Bihar legislature by 194–110, thanks to
the Congress and Jharkhand Mukti Morcha parties voting in alignment with
the RJD.[36]
Laloo claimed he had been instrumental in helping HD Deve Gowda become
the prime minister.[37] However, there was press speculation that Gowda held a
grudge against Laloo for insisting that Gowda step down when Gowda's
fledgling government ran into internal coalition squabbles, and this motivated
him to push CBI Director Joginder Singh for Laloo's prosecution.[22][38] Much
later, in 2008, Laloo also claimed that Deve Gowda confessed, and "wept and
fainted," when Laloo confronted him on inciting the CBI to pursue the
prosecution.[37] Looking retrospectively, Laloo has said that the scam had a

8. lasting negative impact on his political career, and may have ended his
prospects to one day be prime minister of India.[39]
There were reports that Joginder Singh had violated norms in keeping the
new prime minister, IK Gujral, in the dark as he pursued the
prosecution.[38] Gujral's own new government also depended on Laloo for
support in parliament,[40] and Joginder Singh later alleged that Gujral had
attempted to block the scam investigation from proceeding.[41][42] On 30 June,
the federal government issued orders to transfer Singh out of the CBI and into
the Home Ministry as a Special Secretary,[40] which was technically a
promotion but also had the effect of removing him from the
investigation.[43] There was also an alleged follow-on move to transfer U. N.
Biswas, the regional CBI director, which led to the High Court warning that it
would act to disallow any such transfer.[44]
Prosecution[edit]
As the CBI discovered further evidence over the following years, it filed
additional cases related to fraud and criminal conspiracy based on specific
criminal acts of illegal withdrawals from the Bihar treasury. Most new cases
filed after the division of Bihar state (into the new Bihar and Jharkhand states)
in November 2000 were filed in the new Jharkhand High Court located in
Ranchi, and several cases previously filed in the Bihar High Court in Patna
were also transferred to Ranchi. Of the 63 cases that the agency had filed by
May 2007, the majority were being litigated in the Ranchi High Court.[2][45]
Laloo's initial chargesheet, filed by the CBI on 27 April 1996, was against case
RC 20-A/96, relating to fraudulent withdrawals of 370 million (US$6.0 million)
from the Chaibasa treasury of the (then) Bihar government,[23] and was based
on statutes including Indian Penal Code sections 420 (cheating) and 120(B)

9. (criminal conspiracy), as well as section 13(2) of the Prevention of Corruption
Act, 1988.[46] Even though he had been jailed, he was kept in relative comfort
at the Bihar Military Police guest house.[47] After 135 days in judicial custody,
Laloo was released on bail on 12 December 1997.[48] The next year, on 28
October 1998, he was rearrested on a different conspiracy case relating to the
fodder scam, at first being kept in the same guest house, but then being
moved to Patna's Beur jail when the Supreme Court objected.[47][49] After being
granted bail, he was rearrested yet again in a disproportionate assets case on
5 April 2000. His wife and then Chief Minister Rabri Devi was also asked to
surrender on that date, but then immediately granted bail.[47] This stint in prison
lasted 11 days for Laloo, followed by a one-day imprisonment in another
fodder scam case on 28 November 2000.[47]
Jagannath Mishra had been permitted bail in June 1997, and avoided judicial
remand when Laloo was first detained in July 1997. However, he was taken
into custody on 16 September of the same year. He was freed on bail on 13
October but then remanded again, at the same time as Laloo, on 28 October
1998, when he was kept at the same guest house as Laloo, and later shifted
to Beur jail along with him.[49][50] Mishra was freed on bail on 18
December,[49] but then rearrested in a different fodder scam case on 7 June
2000.[3]
Due to the multiplicity of cases, Laloo Yadav, Jagannath Mishra, and the other
accused have been remanded several times in the years since 2000. In 2007,
58 former officials and suppliers were convicted, and given terms of 5 to 6
years each.[49] As of May 2007, about 200 people had been punished with jail
terms of between 2 and 7 years.[45] A 2005 litigation of one of the cases (RC
68-A/96) in the Ranchi High Court involved over 20 truckloads of
documents.[51]

10. On 1 March 2012, nearly 16 years after CBI was handled over the case, a
special CBI court in Patna framed charges against Lalu Prasad
Yadav and Jagannath Mishra along with 32 other accused. Of the total 44
accused, six have died, two have turned approvers, while two others are still
evading arrest. The CBI had chargesheeted them in this case on 3 March
2003. The court said that the trial would begin soon.[52][53][54]
Disproportionate assets case[edit]
A disproportionate assets (DA) case was filed against Lalu in August 1998.
The Income Tax claimed that Lalu had amassed wealth of Rs. 4.6 million out
of the government treasury. Lalu and Rabri werechargesheeted in April 2000
and charges were framed by the court on 9 June 2000. Finally, the couple
was acquitted on 18 December 2006 by a special CBI court.[55]
CBI didn't appeal against this verdict in high court. However, Government of
Bihar challenged the verdict (of CBI court) in Patna High Court and the high
court accepted the plea.[56] This verdict of Patna High Court was challenged by
Lalu and the CBI in SC.[57] The SC in April 2010 declared that the Government
of Bihar has no right to file appeal against acquittal of the accused even in
cases where the CBI refuses to challenge the trial court or High Court's verdict
favouring the accused.[58]
In yet another twist in the case, Government of Chhattisgarh in an unrelated
case requested the Supreme Court to review its verdict in Lalu
Yadav Disproportionate assets case. The Government of Chhattisgarh was
aggrieved by Supreme Court verdict in DA case when it was trying to
challenge the acquittal of former chief minister Ajit Jogi's son Amit Jogi in a
murder case. After the trial court in Chhattisgarh acquitted Amit Jogi in May
2007, for over three-and-a-half years, the CBI again (similar to
Lalu's DA case) did not file any appeal. Chhattisgarh High

11. Court rejected Government of Chhattisgarh's appeal due to Supreme Court's
order (which is binding on all) in Lalu Disproportionate assets case. On 19
March 2012, the Supreme Court agreed to review its own decision in
Lalu'sDisproportionate assets case.[59] However in May 2012, Supreme Court
dismissed the Review Petition holding that the earlier Judgment did not suffer
from any mistake apparent on the face of the record warranting any review.[60]
Convictions[edit]
See also: Prevention of Corruption Act, 1988, Indian Penal Code and Code of
Criminal Procedure, 1973
As of May 2013, the trial has completed in 44 cases out of a total of 53
cases.[7] More than 500 accused have been convicted and awarded
punishments by various courts. Some of the most prominent convicts include
former CM of Bihar Lalu Prasad,[61] former Member of Parliament RK
Rana and former Member of Legislative Assembly Dhruv Bhagat.[8]
On 30 September 2013, a Special CBI Court in Ranchi convicted Lalu Prasad
Yadav and Jagannath Mishra along with 44 others in the case. Thirty-seven
people were taken into judicial custody. The court has announced a sentence
of 5 years and 4 years for Laloo and Jagannath Mishra respectively.[62]
Sentence[edit]
Former Bihar chief minister and Rashtriya Janata Dal president Lalu Prasad
was sentenced to 5 years in jail in a fodder scam case by a special CBI court
on 3 October 2013. The court of Pravas Kumar Singh announced the
quantum of punishment via video conference due to security reasons. Prasad
has also been slapped with a fine of Rs 2.5 million. The 65-year-old leader
has lost his Lok Sabha seat and is also barred from contesting election for six
years following the sentencing thanks to a Supreme Court order.

12. Another former Bihar chief minister Jagannath Mishra has been handed a 4-
year sentence.[63]
Impact[edit]
Since it broke into public light, the fodder scam has become symbolic of
bureaucratic corruption and the criminalisation of politics in India generally,
and in Bihar in particular. It has been called a symptom of the "deep and
chronic malady afflicting the Bihar government and quite a few other state
governments as well."[64] In the Indian parliament, it was cited as an important
indicator of the deep inroads made by mafia raj in the politics and economics
of the country.[65] Reference has also been made to the anarchic nature of
governance (the "withering away of the state") that occurs when a mafia
develops in a state-controlled sector of the economy.[66]
Laloo Prasad Yadav is the only person on whom the Lok Sabha debated for a
complete session as the official agenda.[67]