CBI Red-faced After 103kg Gold Vanishes from Its Custody, Madras HC Orders Police Probe

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The Madras High Court on Friday ordered the Tamil Nadu police to launch a probe into a 2012 case of 103kg of missing gold from the custody of the Central Bureau of Investigation, turning down the CBI’s petition that its “the prestige would come down if an investigation is done by the local police”

“It may be an ‘agni pariksha’ for the CBI, but that cannot be helped. If their hands are clean, like Sita, they may come out brighter. If not, they would have to face the music,” Justice P N Prakash observed as he read out the order to the CBI Special Public Prosecutor.

In a major embarrassment for the CBI, the investigative agency has so far failed to find Rs 43 crore worth of gold missing that disappeared out of the total of 400.47 kg of gold seized from an importer, Surana Corporation Limited.

The CBI had seized the gold in connection with a case dating back to 2012 filed over allegations that officials of Minerals and Metals Trading Corporation of India (MMTC) in Chennai had shown undue favours towards Surana Corporation, which dealt in the import of gold and silver.

The gold, in the form of bars and ornaments, was seized by the CBI from the office building of Surana in Chennai, and locked and sealed in the firm’s vaults. The CBI claims to have submitted the keys of the vault to a Special CBI Court in Chennai, though no date regarding this is mentioned in documents.

In September 2013, the CBI registered another case, saying that while the seized gold was not wanted in the 2012 cases, it had found that Surana had imported the same in violation of the Foreign Trade Policy. In 2015, the CBI filed a closure report in the second case stating that “there is no adequate evidence forthcoming”.

The CBI Special Court accepted the same but directed that the seized gold be handed over to the Directorate General of Foreign Trade (DGFT). This order was later set aside by the Madras High Court on Surana’s petition.

But the SBI, which had given loans to Surana, filed a case seeking the company to repay the pending loans amounting to Rs1,160 crore. The bank moved the Special CBI Court seeking the seized gold.

“Thus… all of them, like the famous character Colorado played by the late 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 before the Special Court… to hand over the gold weighing 400.47 kg” for settlement of dues,” said the court.

The CBI opposed Surana’s petition, backed by the Ministry of Commerce and Industry (under which the DGFT falls). Finally, in December 2019, the National Company Law Tribunal, which had been approached by the SBI, ordered that the gold be handed over for distribution to the six banks owed money by Surana.

Rejecting these arguments, the court said it was “unable to fathom as to how there could be a discrepancy of more than 100 kg… Gold will not diminish in weight like ganja by efflux.”

Coming down heavily on the CBI, the Court stated that the gold had been physically entrusted to the CBI Special Court, and it went missing from there. “The CBI would have cried foul from the rooftops and demanded the scalp of the Special Judge and his property clerk. The Special Judge and the property clerk would have been placed under suspension and would have even been arrested,” the judge said.

Observing that “Caesar’s wife should be beyond suspicion”, the court further directed the CB-CID’s Metro Wing in Chennai, which comes under the state government, to register a regular FIR for theft and entrust the investigation to an SP-rank officer to complete the probe in six months.