HC orders CB-CID probe into missing 103.864 kg gold


The Madras High Court on Friday ordered a Crime Branch-Criminal Investigation Department (CB-CID) probe into missing 103.864 kg out of 400.47 kg of gold seized by the Central Bureau of Investigation (CBI) from an importer in 2012.

Justice P.N. Prakash rejected CBI Special Public Prosecutor K. Srinivasan’s argument that the prestige of the Central agency would come down if the case related to the missing gold was handed over to the State police.

“This court cannot subscribe to this view because the law does not sanction such an inference. All police personnel have to be trustedand it does not lie in the mouth of one to say that the CBI have special horns whereas the local police have only a tail,” the judge said.

He went on to observe: “It may be an agni pariksha [test of fire] for the CBI, but that cannot be helped. If their hands are clean like Sita [of the epic Ramayana], they may come out brighter. If not, they would have to face the music.”

The judge said the CBI had booked a case against officials of the Metals and Minerals Trading Corporation (MMTC) and Surana Corporation, a Chennai-based bullion importer, on June 13, 2012. The allegation was that the MMTC officials had shown undue favour to Surana Corporation.

CBI sleuths searched Surana’s office at NSC Bose Road here, seized 400.47 kg of gold bars and jewels, and kept them in the vaults of the company under lock and seal. According to the CBI, its officials handed over the keys of the lockers to a special court for CBI cases. Subsequently, the CBI found that the seized gold was not required in the 2012 case.

However, it registered another FIR in 2013 against the partners of Surana Corporation for allegedly importing the gold in violation of the Foreign Trade Policy, and transferred the gold from the 2012 case to the 2013 case. “At this juncture, it may be pertinent to state that there was no physical inventorisation by the court because the gold was kept in the vaults of Surana. There was only transfer on paper from one case to the other,” Justice Prakash said.

After completing the investigation in the 2013 case, the CBI filed a closure report stating that no offence had been made out.

The special court accepted the report in February 2015 and directed the CBI to hand over the gold to the Directorate General of Foreign Trade. The gold was transferred on paper and no inventory was taken. Surana Corporation objected to this and sought possession of the gold. Since the company had taken loans from banks, the State Bank of India, the lead bank, sought possession.

“Thus, all of them, like the famous character Colorado played by Omar Sharif in the Hollywood blockbuster Mackenna’s Gold, went on a gold hunting expedition to the special court.

“Like Colorado entering into an agreement with Monkey, the apache, to share the spoils of gold, The SBI and Surana entered into an agreement and filed a compromise memo to hand over the gold, weighing 400.47 kg, to the SBI for settlement of dues to the banks,” the judge said.

The special court accepted the compromise memo and passed an order on December 12, 2017, to hand over the gold to the SBI.

Meanwhile, the Union Ministry of Commerce and Industry, too, staked claim over the gold. However, the National Company Law Tribunal, on December 27, 2019, rejected the Ministry’s request and ordered that the gold be handed over to liquidator C. Ramasubramaniam.

Accordingly, the CBI took inventory of the gold in February this year and found only 296.606 kg remained.

Mr. Ramasubramaniam approached the High Court seeking a direction to the CBI to return the missing 103.864 kg of gold, but the CBI claimed the discrepancy in the quantum might have been caused due to mistakes during weighing. Not convinced with the explanation, the judge said if the gold had gone missing from court custody, the CBI would have cried foul from the rooftop and demanded the scalp of the special judge and the property clerk in-charge of the Malkhana (property room).

However, in the present case, no criminal case had been booked with regard to the missing gold and only an internal inquiry was on within the CBI, he said.

The judge directed the liquidator to lodge a complaint with the CB-CID, Metro Wing, Chennai. The CB-CID, in turn, was directed to register a theft case and nominate an officer in the rank of Superintendent of Police to investigate the matter. All stakeholders, including the CBI officials, were directed to assist the CB-CID in the investigation of the case. Justice Prakash also ordered that the investigation be completed within six months.

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