CBI likely to close case against KM Birla; may not be questioned in Coalgate

NEW DELHI: The Central Bureau of Investigation (CBI) will most likely close its case against Aditya Birla Group Chairman Kumar Mangalam Birla, a top agency official has indicated to ET, in what will come as a major relief to the leading business group whose inclusion in an FIR last year had caused widespread consternation in industry.

The official said the closure of the case, arguably one of the most high-profile ones being probed by CBI as part of its investigations into the coal block allocation scandal, would be decided by March, by when the agency also hopes to “fast-track” its entire investigation into the episode. CBI, which has registered 16 cases in the coal scandal, is keen to wrap up and file its final findings by March, well before a new government is sworn in, the official said on Tuesday. He requested anonymity, given that the case is being monitored by the Supreme Court.

“The Supreme Court has been asking for an expeditious investigation into the coal scam cases,“ a top CBI official told ET. “The CBI also wants to finish its probes into all 16 FIRs by March before the election season kicks in and the new government is formed… Some of the 16 cases may be closed for lack of evidence or criminality,” the official said. One of the cases facing closure could be the Birla case, the official said. This was corroborated by two senior officials close to the probe.


More than 100 days after CBI registered a First Information Report against Birla, former coal secretary PC Parakh and unknown government officials last October citing allegations of Birla group firm Hindalco getting “undue favour” from the government regarding allocation of a coal mine in 2005, the probe agency is still to question Birla or Parakh.

In fact, the top official suggested that Birla may not be questioned at all. Parakh, a well-regarded former bureaucrat, has always protested his innocence and the entire case became for many a symbol of the agency’s alleged overreach and intrusion into matters of policy formulation. The decision to name Birla and Parakh was slammed by many ministers, former bureaucrats and many in industry who warned it would exacerbate the policy paralysis the government was trying hard to reverse.

“We will summon Parakh for questioning next month… We have questioned some senior Hindalco officials lately who dealt with this particular coal block allocation. It may not be necessary to question Birla,” he said. Asked if that meant the case was headed for closure, the official said: “CBI does not intend to question the government policy of allotting coal blocks.”

CBI Director Ranjit Sinha had, in an interview to ET on the day the CBI lodged the case, said that an FIR was an “initial stage of investigation” and CBI could “close the case” if it found no criminality on the part of Birla and Parakh in the matter.

A spokesperson for Hindalco declined to comment. The company has always maintained that it has done nothing wrong, a stand that has won the backing of Prime Minister Manmohan Singh and even former Comptroller and Auditor General Vinod Rai whose audit of coal allocations led to the uncovering of coalgate in the first place.