Justice delayed is justice denied

MUMBAI OCT. 28. With the demise of P. V. Subba Rao recently in Hyderabad, the banking sector lost a senior banker who steered State Bank of India (SBI) as Managing Director from January 10, 1992 to November 30, 1993. His death also brings back to focus the painful, unending saga of 1992 stock scam in which many accused, especially officials of public sector banks, have passed away without having had the opportunity to defend their cases or for that matter even prove their innocence.

Rao was the Managing Director of SBI having jurisdiction over the bank's treasury operations in 1992 when practically the entire financial sector became enmeshed in the securities scandal. He, along with the bank's then Deputy Managing Director, C. L. Khemani, and some other middle level officers, was implicated in a stock scam case filed against Harshad Mehta and the National Housing Bank (NHB). The case has continued all these years.

Rao held several positions in SBI and was also the Managing Director of State Bank of Mysore from May 1984 to September 1986. He joined SBI as a probationary assistant on September 10, 1953.

Practically all the alleged key figures in the 1992 stock scam — Harshad Mehta, Khemani, a senior official of SBI, R. L. Kamat and now Rao — are no more. The then Chairman of SBI, M. N. Goiporia, was asked by the Government to leave and he too passed away shortly thereafter. Eminent jurist, late Nani Palkhivala's poignant tribute to Goiporia — justice delayed is justice denied — applies with equal if not greater relevance to others too including Rao.

It is more than 11 years since the alleged irregularities occurred. Public sector bank officials have had no chance to begin afresh — that luxury has been had only by foreign bank officials — who according to the Joint Parliamentary Committee were the prime perpetrators of the scam.

In Rao's case, the underlying civil suit, involving more than Rs. 700 crores, has not been conclusively settled. The contending parties — SBI, NHB, and the ANZ Group — accepted a Supreme Court formula and received part of the amount. Earlier an award given by an arbitration process involving three former chief justices was set aside by the Special Court trying these cases.

Since Harshad Mehta and many others, allegedly responsible for the scam are no more, there is little point in punishing public servants who in most cases acted on directives of their superiors who have anyway passed away.

Besides, the 11 year delay of the scam courts are all the result of prosecution delays and the accused especially, public sector bank officials, are not responsible in any manner whatsoever for the delays, says Mahesh Jethmalani, a noted lawyer who has been defending the Harshad Mehta group right from the beginning. On the principle of `justice delayed is justice denied', there is a strong case for withdrawing the cases against them.

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