The government stepped in with a sledgehammer two days after the internecine warfare between Central Bureau of Investigation (CBI) director Alok Kumar Verma and his deputy, special director Rakesh Asthana, spilled onto the streets. Both top officers were sent on leave and M. Nageswara Rao was appointed as the acting director.

Thirteen senior CBI officers have been transferred across the country, the largest such top-level purge in a central agency in recent years. A.K. Bassi, the officer investi­gating corruption charges against Asthana, was transferred to faraway Port Blair. The mass action, it now emerges, followed a meeting of Central Vigila­nce Commissioner K.V. Chowdary and his two vigilance commissioners, who met late on the night of October 23 to take stock of the Asthana-Verma turf war. (The CVC is the CBI's supervisory agency in anti-corruption cases.) Both the top officials had to step aside for a fair probe, they seem to have decided. The decision was conveyed to the government, which convened a late-night meeting of the Cabinet's Appointments Committee, chaired by Prime Minister Narendra Modi, which passed the mass transfer orders.

Although the feud between the top CBI officers was well-known, it turned into open war on October 15 when Verma filed a case of corruption against his deputy and the agency raided its own headquarters to arrest a Deputy SP in a nasty hashtag-grabbing CBI versus CBI battle. The hostilities are set to continue with Verma hitting back through a petition in the Supreme Court challenging his removal. An October 26 hearing by the court will ensure the CBI's internal woes remain a national embarrassment.

In the words of CVC Chowdary, whose October 23 order stripping Verma of his powers became the basis for the government action, "an environment of hostility and faction feud has reached its peak in the CBI, leading to potential loss of reputation/ credibility of the organisation. The grave allegations of corruption by senior functionaries of the CBI, one against the other, also widely reported in the media, have vitiated the official environment. It has also vitiated the working environment in the organisation, which has a deep and visible impact on the other offices".

This is by no means the first time the CBI has been mired in controversy-a 2013 Supreme Court tongue-lashing describing it as "a caged parrot". It chargesheeted two former directors, Ranjit Sinha and A.P. Singh, for corruption last year, but these appear to be mere pustules compared to the deep rot that besets the country's premier investigative agency.

Agency old-timers are understandably horrified that the CBI, usually in the news for probing sensational cases, has itself turned into a scandal. "What has happened is most unfortunate," says former CBI director R. Karthikeyan. "It was totally avoidable." The crisis has eroded the credibility of the 55-year-old institution, divi­ded the cadre and has had a fallout engulfing sections of the higher bureaucracy. The scandal has raised serious questions on just how the prime minister failed to anticipate the tumult in the agency, which operates directly under his office.

VERMA VERSUS ASTHANA

Verma is not giving up without a fight. In his October 24 petition to the Supreme Court, he termed the orders divesting him of powers as manifestly arbitrary because the CVC did not consult the high-powered committee headed by the prime minister, the leader of the opposition and the chief justice of the Supreme Court, as mandated by the Delhi Special Police Establishment Act (which established the CBI), who have to give consent for an agency chief's transfer. The Department of Personnel and Training, he said, was seriously hindering the independent functioning of the CBI. Verma also accused Asthana of taking decisions that stymied investigations in very sensitive cases.

The tension had been building up for a year on the top floor of the agency's headquarters-an 11-storey structure in Delhi's CGO Complex. The undeclared war between Verma and Asthana was the worst-kept secret in the green glass building modelled on the Interpol's headquarters in Lyon, France. The duo, who occupied adjacent offices, had stopped speaking to each other over the past six months. Last October, Verma tried to scupper Asthana's promotion because the agency was investigating him for corruption charges. Asthana hit back with a series of complaints, accusing Verma and his associates of corruption. The CBI filed an FIR against Asthana on October 15, accusing him of receiving a Rs 3 crore payoff for diluting a case he was investigating (see graphic So, Who Got the Bribe?).

When Verma, a 1987 AGMUT (Arunachal Pradesh, Goa, Mizoram, Union Territories) cadre IPS officer, moved from the office of Delhi police commissioner to the head of the CBI on February 1 last year, the agency had been headless for two months, and Asthana had been the acting director. Asthana, a high-profile Gujarat cadre officer, had been investigator in two highly sensitive political cases-the 1997 fodder scam, which directly implicated former Bihar chief minister Lalu Prasad Yadav, and the Godhra train burning in 2002, in which 59 persons were killed. He was seen as a favourite of the Modi government in Gujarat, and built up as model of probity. As Surat police commissioner between 2013 and 2015, Asthana played a major role in the cases of rape and corruption against godman Asaram Bapu and had also booked his son Narayan Sai and his men for offering him bribes to let Asaram off. A hagiographic social media video from his stint in Surat likens him to Vallabhbhai Patel and Subhas Chandra Bose.

As additional director of the CBI in Delhi, Asthana headed the agency's special investigation team (SIT) in probing two cases of great significance to the National Democratic Alliance (NDA)-the 2013 AgustaWestland case, which allegedly involved payoffs to Congress politicians, and the inquiry against fugitive tycoon Vijay Mallya. The trouble between Asthana and Verma erupted mid-2017 when Asthana torpedoed Verma's recommendations for the appointment of some officers in the CBI, including allegedly the relatives of Enforcement Directorate (ED) joint director Rajeshwar Singh. That set off a protracted war between them which spilled into the open when Asthana came up for promotion as special director last year.

In a letter to the CVC, Verma objected to Asthana's promotion, saying Asthana was being investigated in the Rs 5,000 crore Sterling Biotech scam. Verma said Asthana had allegedly received bribes from the pharma firm's promoters, Chetan Sandesara and family. The CVC, however, overruled Verma's objection and Asthana was appointed special director. For Asthana, the victory was short-lived. When Verma went on an official tour to Uruguay, he issued an order forbidding Asthana from attending a meeting called by the CVC because he was still under the scanner in the Sterling Biotech case. The letter got leaked in the media, indicating the mess in the CBI.

On August 24, Asthana dashed off a 21-page complaint to the CVC, marked 'top secret'. In the letter, a copy of which was accessed by INDIA TODAY, Asthana alleged that there was a concerted bid by Verma and ED director Singh to tarnish his image by leaking documents containing unverified, unsubstantiated information and by making malicious allegations against him.

In the letter, Asthana flagged certain points from a 2017 case against meat exporter Moin Qureishi whom the ED was investigating. (Former CBI chief A.P. Singh is a co-accused in the case.) According to Asthana, Sana Sathish Babu, a Hyderabad-based businessman, had paid Verma Rs 2 crore to escape action. Asthana says when the CBI called Babu, Verma called up Asthana and told him not to cross-examine Babu. Nevertheless, Asthana asked the investigating officer to continue with the interrogation. That was the first of at least five petitions Asthana addressed to the CVC, in which he has made over a dozen allegations against Verma and CBI joint director A.K. Sharma. Asthana alleged Verma had prevented CBI officers from raiding Lalu Prasad Yadav in a railway corruption case registered by the agency when the RJD leader was Union railway minister. On another occasion, Verma and Singh sought to protect a key ED official, who had been caught taking a bribe of Rs 5 lakh by the CBI, Asthana alleged.

Since mid-2017, Asthana alleged Verma and Sharma were building a case against him based on entries in a diary recovered by the ED in the Sterling Biotech case. The diary had four cash payment entries, totalling Rs 3.8 crore, against 'RA', which Verma and Sharma said stood for 'Rakesh Asthana' and used as 'evidence' against him, Asthana suggested. However, Asthana admitted he knew the Sandesaras and says he had even rented out his Gandhinagar house to their company, Sterling Biotech, after informing the government. But he maintains the RA against which payment entries are marked pertain to 'Running Account'. The case against Asthana may have weakened recently when a company owned up the amounts mentioned in those entries. That was perhaps the reason why a CBI team grilled a series of hoteliers in Vadodara to check whether Sandesaras had borne the wedding cost of Asthana's daughter in the city in 2015. Bassi led the investigation.

Asthana was indeed close to the Sandesaras and his daughter's sangeet ceremony was held at Chetan's farmhouse on Vadodara's outskirts. However, Asthana claimed to have made due payments for the dinners hosted during the wedding and maintained that he availed of the venues on a 'complimentary basis'.

THE CASE AGAINST ASTHANA

Babu returned to haunt the CBI, but in a dramatically different manner from what Asthana described in his letter to the cabinet secretary on August 24. The CBI's October 15 FIR accused Asthana of accepting a Rs 3 crore bribe for letting off Babu in the hawala case. On October 16, the CBI arrested Manoj Prasad, an investment banker and executive vice-chairman and CEO of Dubai-based financial services firm Que Capital. Manoj and his brother Somesh Prasad, also based in Dubai, were allegedly the conduits for the bribe to be paid to Asthana, says the FIR. The CBI arrested its deputy SP Devender Kumar in the raid on its headquarters on October 23. The agency has charged Kumar with falsifying evidence to back Asthana's allegations against Verma.

The opposition Congress was quick to seize the opportunity arising out of the disarray in the CBI. The party claims Verma planned to hold the government to account over the 2016 purchase of 36 Rafale fighter jets from France. On October 4, Verma had met Supreme Court lawyer Prashant Bhushan and former Union ministers Arun Shourie and Yashwant Sinha, who handed him a petition urging him to probe the alleged irregularities in the Rafale deal. "The PM's message is clear, whoever comes near Rafale will be removed, wiped out. The country and the Constitution are in danger," Congress president Rahul Gandhi tweeted soon after Verma's removal.

But according to the eight-page order the CVC served on Verma on October 23, it was inaction on Asthana's August 24 complaint that forced the CVC's hand in this 'extraordinary and emergent situation'. The CVC had sent Verma three notices, but to no avail. Verma did not respond to a letter sent to him on October 3, requesting him to attend a meeting with the CVC the next day. He also ignored the CVC's request for a report on Asthana's secret note by October 22, the day the CBI raided its own premises and arrested its Deputy SP.

With the ongoing tumult within the agency, the question being asked is how this will affect the important cases it is handling. The high-profile cases include the Aircel-Maxis case, in which the CBI chargesheeted former finance minister P. Chidambaram and his son Karti this July for alleged FIPB (Foreign Investment Promotion Board) approvals granted for pecuniary benefits when Chidambaram was finance minister. Asthana was investigating the Mallya extradition and the AgustaWestland cases.

The CBI's fratricidal war, meanwhile, threatens to engulf important sections of the bureaucracy outside the agency. Verma, ED's Singh and the CBI's A.K. Sharma, a Gujarat officer close to the Modi government since the Gujarat days, but severely opposed to Asthana due to personal rivalry, are believed to be on one side. Many of these officers, it is believed, have the support of an influential BJP MP and also some ministers in the Modi government. On the other side are Asthana and revenue secretary Hasmukh Adhia, supported by P.K. Mishra, additional principal secretary to the prime minister, and his second-in command Bhaskar Khulbe, who handles postings in the PMO. BJP chief Amit Shah informally advises Modi on crucial postings, such as in the CBI, ED and the National Investigation Agency (NIA). Meanwhile, there is shock and disbelief in the 7,000-plus ranks of the CBI. Officers say they feel let down and embarrassed by the war within. They believe the prime minister was wrong in letting the feud between the two top CBI officials simmer for so long .

While Asthana has been named as prime accused in the FIR, there seems to be no direct evidence linking him to the case. A key loophole is that Babu says middleman Prasad called Asthana from Dubai on WhatsApp. VoIP calls are banned in the UAE. What was surprising in Asthana's case was that Babu's statement against him and Kumar was turned into an FIR the very day he gave the statement, which was against established conventions when officers from the same service or organisation are involved. Verma and Sharma were possibly in a hurry to pre-empt a possible attempt by Asthana to convert Babu's earlier allegations into an FIR against Verma.

A source close to Verma told India Today, "He (Verma) had to book Asthana or else Asthana would have booked him using Babu." However, an Asthana aide said, "It is the director and A.K. Sharma who fired the first salvo and started the victimisation game against Asthana by trying to book him in the Sterling Biotech case. Asthana has only taken pre-emptive measures.

THE ROT RUNS DEEP

The full-blown crisis in the CBI, almost unprecedented in recent years, has revealed the government's catastrophic neglect of the agency, which it knew was riven by internal rivalries. Prime Minister Modi, BJP president Shah and the PMO bureaucrats allowed this to fester instead of taking corrective action. Shah shares the blame for the current mess because he functions as Modi's advisor on appointments in politically sensitive agencies.

Rahul Gandhi was quick to seize upon the disarray in the CBI to take aim at an embattled prime minister. "The PM's blue-eyed boy, Gujarat cadre officer of Godhra SIT fame, infiltrated into the CBI as its no. 2 has now been caught taking bribes," Rahul tweeted on October 23. "Under this PM, the CBI is a weapon of political vendetta. An institution in terminal decline that's at war with itself.

Says a senior officer, "Had the PMO called the three officers together and warned them against any further undercutting, with a personal warning from the prime minister himself, things wouldn't have come to such a pass.

Where then did the CBI lose its way and become a controversy magnet? Former police officials trace the downturn to the mid-1990s when the agency became increasingly politicised-by 2013, it earned the dubious "caged parrot" sobriquet from the Supreme Court, a reflection of its reputation as a tool for settling political scores.

N.R. Wasan, former director general, Bureau of Police Research and Development, says, "The CBI has come to such a pass because of the flawed induction mechanism introduced after the Vineet Narain hawala case." The CBI was widely criticised when its prosecutions collapsed and the Supreme Court, deciding the Vineet Narain case, issued directions, including CVC oversight of the CBI. "This has led to the ugly split and spat, with at least three warring groups inside the CBI trying to outwit each other.

Ajay Agnihotri, former member, Central Board of Direct Taxation, says, "All intelligence and investigation outfits in the states and at the Centre must be brought under legislative jurisdiction, like the US system. Leaving the bureaucracy to monitor the bureaucracy is the reason for this mess.

Wasan says there is a need for total overhaul of the induction system in order to include only those "who have both competence and integrity and not just integrity alone". A recent trend, inspired by political and other extraneous considerations, has been to induct personnel with no earlier experience at the top. Like several of his predecessors, newly-appointed interim director M. Nageswara Rao does not have long-standing experience in the CBI. In the past, he has faced allegations of corruption by the CBI's Special Unit head. He was also accused of stalling a probe against I-T officials whose names figured in the diary of arms dealer Sanjay Bhandari. The BJP has accused him of being close to Robert Vadra.

Shantanu Sen, former joint director, CBI, says the rot began in 2000 when the agency stopped direct recruitment of officers, something the CBI needs to restart. "Lal Bahadur Shastri and agency founder director D.P. Kohli had visualised the CBI as made up of a backbone of directly recruited officers who were trained to be investigators, who could take cases to their logical end and stand up to political pressure.

Appointing an IG level officer whose first action was to transfer or allot 'additional charge' to 13 officers, several of whom were investigating Asthana, to head the agency, is unlikely to reduce the stench of political interference surrounding the government's relationship with the CBI.



THE HOT POTATOES

IRCTC SCAM: Lalu Prasad Yadav as rail minister (2004-09), allegedly committed irregularities in allotment of hotels. Asthana has alleged Verma's interference in probe

STATUS: Chargesheet filed; a Delhi court granted bail to Lalu and others on October 5

VVIP CHOPPER CASE: Bribes allegedly paid to Congress leaders, bureaucrats and IAF officials by Italian firm AgustaWestland to secure a Rs 3,600 crore contract

STATUS: Ex-IAF chief S.P. Tyagi arrested, but extradition of key middleman Christian Michel from the UAE stuck

COALGATE SCAM: Illegal coal blocks allocation betw­een 2004-09 causes Rs 1.86 lakh crore loss to the exchequer

STATUS: Ex-coal secretary H.C. Gupta and ex-Jharkhand CM Madhu Koda convicted in four cases that went to trial

AIRCEL-MAXIS SCANDAL: Ex-finance minister P. Chidam­b­aram and son Karti face violation of regulations, money laundering charges in Aircel acquisition by Maxis

STATUS: On October 1, a Delhi court gave the CBI seven weeks to get sanction to prosecute Chidambaram

COMMONWEALTH GAMES 2010 SCAM: Games organising committee, headed by Congress leader Suresh Kalmadi, allegedly swindled around Rs 70,000 crore

STATUS: Kalmadi out on bail. Some officials convicted

VIJAY MALLYA LOAN DEFAULT: Mallya defaulted on loan repayments of over Rs 9,000 crore to 20 banks

STATUS: Mallya currently facing extradition proceedings in a UK court; judgment on December 10. Asthana was probing downgrade of the lookout circular against him, which allowed him to leave the country

PUNJAB NATIONAL BANK SCANDAL: Bank swindled of over Rs 12,000 crore by celebrity jeweller Nirav Modi and partner Mehul Choksi

STATUS: Chargesheet filed in a Mumbai court

SARADHA AND ROSE VALLEY SCAMS: Two of West Bengal's biggest Ponzi scams

STATUS: State sports minister Madan Mitra, TMC MPs Kunal Ghosh and Srinjoy Bose and former state DGP Rajat Majumdar among those arrested. P. Chidambaram's wife Nalini and CM Mamata Banerjee implicated. Asthana was recently in West Bengal to take stock of case's progress

ROBERT VADRA AND B.S. HOODA CASES: Alleged corruption in Manesar, Har­­yana, land deals worth Rs 1,500 crore. Another land scam in Bika­ner, Rajasthan, involves Robert Vadra, Rahul Gandhi's brother-in-la

STATUS: Chargesheet filed against ex-Haryana CM Hooda and 33 others in Manesar deal. FIR filed against a Vadra company in Bikaner case

MISSED TARGETS

Some of the high-profile cases where the CBI failed to get conviction

AIRCEL-MAXIS

In 2011, the Supreme Court asked the CBI to probe if then telecom minister Dayanidhi Maran had received kickbacks in the acquisition of Aircel by Malaysian company Maxis

STATUS

A CBI special court in 2017 dropped all charges against the minister, his brother Kalanithi Maran and several others

JAIN HAWALA SCAM

A diary maintained by hawala trader S.K. Jain suggested that a total of Rs 65 crore-unaccounted cash was paid to top politicians, including L.K. Advani and Sharad Yadav, between 1988 and 1991

STATUS

All accused were acquitted by court; following this case, the Supreme Court directed the CVC to supervise the CBI's functioning

AARUSHI-HEMRAJ MURDER

Thirteen-year-old Aarushi and domestic help Hemraj were found murdered in a flat in Noida in 2008. The CBI booked her parents, Rajesh and Nupur Talwar, for the murders

STATUS

In October 2017, the Allahabad High Court acquitted the couple. In March this year, the CBI challenged the acquittal in the Supreme Court

2G SPECTRUM

The CBI was investigating alleged irregularities by the UPA government in the allocation of 2G spectrum to private companies. According to a CAG report, the exchequer lost Rs 1.76 lakh crore on account of the scam

STATUS

A trial court acquitted all accused, including former Union minister A. Raja, in December 2017. In March this year, the CBI moved the Delhi High Court

BOFORS

In April 1987, a Swedish radio channel alleged that Swedish arms manufacturer AB Bofors had bribed top Indian politicians and defence personnel to secure

Rs 1,437 crore contract to supply 400 howitzer guns to the Indian Army. The scandal rocked the Rajiv Gandhi government. The CBI registered a case against the then Bofors president, alleged middleman Win Chadha, Italian businessman Ottavio Quattrocchi and the London-based Hinduja brothers for criminal conspiracy, cheating and forgery

STATUS

In 2005, the Delhi High Court quashed the charges against AB Bofors, Chadha and Hinduja brothers. In February this year, the CBI moved the Supreme Court challenging the high court order

ILLEGAL MINING IN BELLARY

This case allegedly involved a bribe of Rs 40 crore. In 2015, the CBI filled a chargesheet, saying Rs 20 crore was allegedly paid to a trust run by the family of former Karnataka chief minister B.S. Yeddyurappa for granting favours, including mining licences, during his tenure as chief minister

STATUS

In October 2016, a CBI special court acquitted Yeddyurappa and 13 others, stating that the CBI had failed to establish their guiltIn October 2016, a CBI special court acquitted Yeddyurappa and 13 others, stating that the CBI had failed to establish their guilt

(With Rohit Parihar and Amarnath K. Menon)