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October 12, 1999


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The Rediff Business Interview/ Mahesh Jethmalani

'If they had only listened to Harshad Mehta, no one would have lost any money'

Very powerful people are trying to make Harshad a scapegoat.'

Or so says his lawyer, Mahesh Jethmalani. Who, like his illustrious father, loves to defend controversial clients who others have given up on. Mahesh argues in this interview with Pritish Nandy that Harshad Mehta is a victim, not a criminal. In fact, he thinks the recent arraignment of Mehta is part of a deliberate strategy to allow the real criminals to escape by the back door.

Why is your client getting such a bashing in the courts?

The media insists on portraying him as the face of the scam. So it is very difficult to cut through the hype and the exaggeration to reach the truth. Even if the judge deep down in his heart actually believes that Harshad Mehta is totally innocent, it is very difficult (with all due respect to him) to acquit him. I truly and totally believe from the bottom of my heart, not because Harshad Mehta is my client, that this was a great case for acquittal. There is nothing to this case at all. It relates to pre-scam transactions. The scam period is restricted in terms of jurisdiction, from April 1991 to June 1992. Three of the five transactions in this case were during January and March 1991!

The next point is that there has been no loss caused! The entire, elaborate, expensive structure of the special court (where the government is spending lots of money) was meant to prosecute and recover moneys. Is the money being recovered?

You tell me.

That is what is baffling me. The court is merrily carrying along. The lawyers are enjoying it. It is one more forum to earn fees. But nothing constructive is happening. The entire purpose is being frustrated. Who's moneys have been recovered? Rs 4024 crore, said the JPC (was filched) but where's that money? They only talk about Harshad Mehta all the time. As if by putting him behind bars, they are resolving the entire scam!

What was the figure according to the Janakiraman Committee?

The same. Both have cited Rs 4024 crore as the figure. What the banks and the financial institutions have lost. The whole idea behind all this was to recover the public moneys. But nothing of the sort has happened. It's a joke!

Do you now anticipate a whole new rush of judgments coming up against Harshad Mehta? That's what the media appears to be forecasting.

No. Why should it?

Well, there's a whole of cases pending against him still? A judgment is one likely to quicken judgements in the others.

If that's the focus of the CBI, so be it. They can start other cases also. So what's the big deal?

What are your plans for your client, apart from appealing against the judgment?

First to go to Supreme Court and (then) contest all the other trials. But I think it is time that some people started talking about the moneys. After all, the idea was to recover public moneys. Nothing has happened on that front as yet.

Why? Why do you think things are not moving in that direction?

Because there are very powerful interests working (behind the scenes) who are actually subverting the CBI. Those powerful interests have money at their disposal. Mind you, Pritish, I am saying this in all earnestness. Harshad Mehta is very easy to pin down. You paint him as a villain (and let him take all the flak). This is classic. Any time you have a major problem, a systemic failure (like the scam or the bomb blasts) where there has been a lapse on the part of the government, a failure...

A systemic failure? You sound like Manmohan Singh.

Yeah, I am using his words. Every time you have a systemic failure or an intelligence failure, as in the case of the bomb blasts... They knew the mosque had been demolished out there and there was bound to be a retaliation and all they had to do was to guard the porous boundaries where all the smuggling takes place normally. They didn't do that. They didn't take the most elementary precautions in the wake of December 6, 1992. They knew there was bound to be some retaliation from fundamentalists abroad fanned by the ISI. But they ignored it.


Neglect. Then what they do is try and get a human face to it. A scapegoat. It was Sanjay Dutt for the bomb blasts. You got Harshad Mehta for the scam. So everything focuses on them. They become the face of the crime as it were.

But in the scam matter, you had many faces to begin with. Bhupen Dalal and Hiten Dalal. The foreign banks.

Hiten Dalal is the other guy who has been prosecuted. But what's the point? Have they traced the moneys? Where has it gone? Harshad Mehta has Rs 3000 crore tied up in court. So appropriate it for those people for whom you created the special court. Your Canara Bank, your State Bank, your National Housing Bank. Why aren't they appropriating the money? I can't understand.

What do you think is the reason?

The idea is to keep the circus going so that you can slowly exonerate the rest. The ones with the clout. Some very powerful people are trying to make Harshad Mehta the scapegoat so that they can escape.

You think Harshad Mehta will actually and eventually go to jail to serve out a sentence? That he will break stones or do whatever convicts do?

If he does, it will only be because they want to pin this whole thing on him.

When will it happen if it does?

Oh, that will be, say, another five or six years later. The appeal for the first case will not come up, going by past Supreme Court precedents, for a long, long time. We are far away from Tipperary.

How much of money do you think your client pocketed during the scam?

All his money is lying in court. Rs 3000 crore. If they had only listened to him when he told Manmohan Singh, I have enough money to pay off all my liabilities. But no one listened. If they had only listened, no one would have lost any money.

Why didn't they listen?

Because the other scam players were powerful. If he had paid off all his liabilities, they would have come into focus. This they could not afford to do. Too many powerful people would have been implicated.

Maybe they couldn't assess the exact extent of his liabilities at that stage?

The banks had it all. The Janakiraman Committee had documented it.

What stops it from happening now? Paying off the liabilities and sorting the case out.

The judge has already said this in court twice. He told me: You client has enough money to pay off all his liabilities except for his taxes. That's the point. Harshad Mehta has enough money to pay back all his creditors with interest. There will then be no scam left! That is why they got some crazy income tax guys to say: Harshad Mehta owes us Rs 5000 crore! No doubt egged on by some finance ministry officials. The man's income was not Rs 5000 crore. How could he owe them that kind of money? Now they are trying to scale down the figure. It's all a strategy to keep Harshad Mehta tied up in knots. So that the real culprits can escape.

What are his actual liabilities? What are his assets? What are his tax dues?

His assets are all with the court. They are worth more than Rs 3000 crore today. While his liabilities do not exceed Rs 1200 crore. If you add tax dues of Rs 400 to Rs 500 crore max, he can still walk out a free man with over Rs 1000 crore of assets. That's what they are frightened of.


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