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Rafale, CAG & Tense

Rafale, CAG & Tense

When Vinod Rai was the Comptroller and Auditor General of India, he projected a presumptive loss of Rs 1.76 lakh crore to the exchequer from 2G spectrum allocation. The figure was the base for the RSS to launch the India Against Corruption Movement and make heroes out of the likes of Arvind Kejriwal and Narendra Modi.

Today Rai is nicely ensconced as the interim President of the Board of Control for Cricket in India, among other things, while the auction held for the 2G spectrum did not fetch more than a third of his presumptive figure. Worse, telecom companies are making losses, cutting corners, merging or exiting the Indian market, even as mobile phone users very often receive messages that they are unable to contact the person intended to.

If ordinary people are so familiar with Rai’s erstwhile CAG, thanks to his presumptuous figures, judges of the honourable Supreme Court are expected to be aware of the status of CAG’s audit reports on politically sensitive at least. Hence, it was surprising to read last week’s Supreme Court order on the Rafale deal. The court has said that since CAG has audited the deal and it was before Parliament’s Account’s Committee, there was no need for it to go into the pricing issue.

This verdict is strange for several reasons. The Modi Government 48 hours later submitted to the court a ‘grammatical correction’ for the verdict. It suggested change in tense: Since CAG would be auditing the Rafale purchase deal and placing its report before Parliament’s Account’s Committee, the court need not look into the pricing detail.

If it was as simple as that, one wonders why the honourable judges in the first place admitted petitions filed on the Rafale purchase. It could have at the stage of admittance of the petitions said that the court was not the competent authority to look into the pricing and it was the job of the CAG and CAG’s report would be placed before the PAC, which would give its report to Parliament that comprises people’s representatives. There was no reason why the Supreme Court should have heard the case going by the reason on pricing it gave in the verdict.

The aim of some of the petitioners had been suspect from the beginning. They have in previous cases filed petitions seen as helpful to the Modi Government and create embarrassment to the Gandhi family. Of course, there were also the wise men in the erstwhile NDA Government, Arun Shourie and Yashwant Sinha, who too had petitioned the Supreme Court. Sinha, Shourie and Prashanth Bhushan had approached the Supreme Court only as a last resort as the Modi Government was delaying in placing the Rafale purchase deal for an audit before the CAG.

It is hence mysterious that the Supreme Court decided to look into the petition, hear arguments for days and at the end of it say that it will not go into Rafale’s comparative pricing, because that was the only issue of contention. It is also very surprising that the honourable judges of the Supreme Court were not aware of the fact that CAG had not begun the audit on Rafale, leave alone submit a report to PAC.

Even if one were to believe the tale of the Government that its submission was a grammatical error involving wrong use of the tense in the sentence on CAG audit, the public would have expected the learned judges of the Supreme Court, comprising Chief Justice of India Ranjan Gogoi and Justices Sanjay Kishan Kaul and K M Joseph, to tell the Attorney General of India that the Government had erred in its claim that the deal had been audited while seeking clarity on the claim before the verdict.

Also, no one has questioned the capability of the Rafale aircraft. Hence it looks odd when everyone from the Air Chief Marshall to the Defence Minister to the judges of the Supreme Court talk about the quality and capabilities of the Rafale fighter jets. The Congress party, which was in power when Rafale was selected, in any case, would be the last one to question the capabilities of the aircraft. Its arguments have been that the Modi Government has paid a much higher sum for each aircraft for no logical reason.

The details of the agreement available on the website of Dassault Aviation clearly say that the Rafale fighter jets would be of “the same configuration as tested by the Indian Air Force.” This testing was done before shortlisting by the UPA Government. The IAF has not done any new tests. So, the claim that the Government has put up via pliable news organisations that the ‘deals cannot be compared as the new jets would have enhanced capabilities which were not there in the initial deal’ is plain nonsense.

While one has to take into account cost escalation per year and also factor in paying more money for buying assembled fighter jets (36 in place of 18), the Congress’ claim has been that the price per jet had shot up from around Rs 550 crore to Rs 1650 crore, a price difference of Rs 1,100 crore per plane. The reason for this price difference has not been convincingly explained by the Government, which has been taking refuge in the secrecy clause linked to national security. Divulging the price per aircraft can never be part of national security and it would ultimately need to do so before CAG. In a nutshell, the Supreme Court’s verdict in the Rafale case has added to its mystery.

Finally 18%

When the Modi Government debated and discussed the Goods and Services Tax, before its passage in Parliament and eventual implementation from July 2017, the Congress had insisted that the percentage of GST be pegged at 18% for all goods. However, the Modi Government was dismissive of the suggestion and alleged that the Congress was ‘batting for the rich who buy luxury goods’.

A year and a half after GST has wreaked havoc on small and medium businesses, the Modi Government has finally come around to the view that most goods should be in the 18% bracket. “All things related to common man will be 18%,” Modi said in Mumbai recently. Air conditioners, dishwashers and cement are no longer ‘things for the rich’. However, Modi being Modi, had to add his touch. Only certain items such as “expensive alcohol and aircraft” would be in higher tax bracket, he said. As the PM, he should know no one in India makes aircraft for private citizens to buy, nor is alcohol under GST.

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(Published on 24th December 2018, Volume XXX, Issue 52)