The defence ministry on Tuesday issued a show-cause notice to a senior officer of the Indian coast guard, DIG BK Loshali, for owning up to the responsibility of sinking a Pakistani boat with suspected terrorists on board on this new year's eve. The revelation left the Indian government red-faced, because it was claiming that the boat had exploded and sunken by itself.

The startling revelation was enough for Pakistan to latch on, as its defence minister Khawaja Asif said, "India has once again proved to be heinous in its face, designs and urging for peace." Khawaja said that Indian forces had claimed "four innocent lives" and it was India's common habit to disregard and rip apart international laws.

In Delhi, the defence ministry stood by its ground that the boat was part of an attempt to repeat 26/11. Yet the external affairs ministry was still to issue a demarche to Pakistan on the issue, reinforcing doubts about the government theory.

Joining the controversy, the Congress party demanded that the government should come clean on the issue and warned against threatening the DIG. The Aam Aadmi party said the row showed how one hand of the government did not know what the other hand was doing.

Congress leader and former minister Manish Tiwari asked the defence minister why he was apologetic about blowing up the Pakistani boat, if it truly was a terror boat. "Uncanny similarities to similar modus operandi; the fake encounter syndrome to bolster machismo & build Alpha image," he tweeted.

Going into damage control mode, the defence ministry and its wing, the Coast Guard, immediately distanced themselves from DIG Loshali, with officials claiming that Loshali was not involved in the said operation at all. Officials further claimed he must have spoken under the influence of alcohol, in an attempt to boost his image during a public function.

Sources said that Loshali may be court-martialled and dismissed from service for his misconduct.

dna had found several gaping holes in the terror narrative that the defence ministry built around the incident. The defence ministry had claimed that its terrorist crew set the boat on fire and the boat exploded when encircled and challenged by the Coast Guard.

Later, it emerged that the boat had petty smugglers on board. They had drifted to the Indian side to evade Pakistani Coast Guards and were mistaken for terrorists by the Indian Coast Guards.

It was believed that the National Technical Research Organisation (NTRO) had intercepted satellite phone conversations, which were passed directly to the Coast Guard officials at Porbandar. The premier intelligence organisations, namely IB, RAW and DGMI, had, however, disputed the claims.

Video footage of Loshali shows him telling an audience in halting English at the launch of an interceptor boat in Surat on February 16, "I hope you remember 31st December night. We blew off the Pakistan... I told at night, blow the boat off. We don't want to serve them biryani."

Loshali rushed to undo the damage on Wednesday morning by issuing a denial. By then, it was too late.

"I am the chief of staff. Operations are known only to the commander. I have been misquoted as I had spoken in a generic context," said Loshali at a hurriedly-called press conference in Surat.

Trying to clarify, defence ministry officials said, the role of chief of a staff in a formation is administrative, and doesn't overlap with operations, which means DIG Loshali couldn't have knowledge about the action against the Pakistani boat.

"Operations are planned and executed by commander-in-chief, in this case, inspector-general west of the Coast Guards," a Coast Guard official said.

At the Bangalore Air show, Defence Minister Manohar Parrikar also firmly backed the Coast Guard official's stand reiterating the government's line.

"The defence ministry stands by what it has stated in the past. The ground reality doesn't change. I want to be very clear," he said.