Maruti scandal –1974

In 1974 Indira Gandhi’s
name came up again in the first Maruti scandal, where her son was favoured with a licence to make passenger cars in the then highly restrictive-environment.

1970

• A private limited company named ‘Maruti technical services private limited’ (MTSPL) launched on November 16, 1970. The stated purpose of this company was to provide technical know-how for the design, manufacture and assembly of “a wholly indigenous motor car”.

1971

• In June, A company called ‘Maruti limited’ was incorporated under the Companies Act and Sanjay Gandhi became its first managing director..

1977

• ‘Maruti limited’ goes into liquidation.

1978

• A commission of inquiry headed by Justice A. C. Gupta, which probed the ‘Maruti scandal’, submits its report.

Nagarwala scandal :1971

On May 24, 1971, 60 lakh (US$113,400) was withdrawn from the State Bank of India, Parliament Street branch, and given to a “Bangladesh ka babu” (Hindi for “man from Bangladesh”) after the chief cashier, Ved Prakash Malhotra, got a call purportedly from Indira Gandhi then Prime Minister of India asking him to do so.

Later it was discovered that former army captain, Rustom Sohrab Nagarwala, then attached to Indian intelligence or R&AW, collected the money from Malhotra, by “mimicking the voice of Mrs. Indira Gandhi”, presumably for being diverted to the Mukti Bahini in its guerrilla-liberation campaign from West Pakistan. Nagarwalla, it was later alleged, was about to leave that same evening for Nepal. He was arrested, however, after Malhotra went in person to collect a receipt from P. N. Haksar, Indira Gandhi’s personal secretary, informing him that the requested payment was done. A stunned Haksar informed Malhotra that Mrs Gandhi had instructed nothing of the sort and urged him to inform the police immediately.

The opposition parties suspected that the money belonged to Indira Gandhi. They also alleged that it was not an isolated case.

The investigating officer, D. K. Kashyap, investigating the case was killed in a car attack. Nagarwala was sentenced for four years and died in prison in February, 1973. This was due to deliberate neglect of his increasing ill-health, a point in fact later confirmed in an official enquiry.

A Commission of Inquiry was set up by Janata Party under Justice P. Jagan Mohan Reddy on June 9, 1977, to probe into the Nagarwala case.

Justice Jaganmohan Reddy listed four “incontrovertible facts” – one of them being the fact that Indira Gandhi did not have any account in that branch – but concluded that they were not sufficient to hold that the money belonged to her. “There were several lacunae,” he said, and listed them. “To supply an answer to these (lacunae) would force me to leave the safe haven of facts which required to be established by evidence and enter the realm of conjectures and speculation.” (p. 176).