Aug. 2 (Bloomberg) -- India needs “clean men in black robes” to help end corruption, Chief Justice Sarosh Homi Kapadia told the Indian Bar Association in an April speech.
The 31-judge Supreme Court he’s led since May 2010 has already risen to his challenge -- ousting the head of India’s anti-graft watchdog, forcing the government to hand out food to the poor, and overseeing probes leading to the jailing of a billionaire executive and a former telecommunications minister.
On July 4, foreign banks were the target of Judges B.S. Reddy and S.S. Singh Nijjar. Their ruling for the top court began by citing the instructions given to reporter Bob Woodward during the Watergate investigation: “Follow the money.”
They ordered a team headed by a judge to take over the government’s efforts to retrieve as much as $500 billion that Indians may have stashed illegally overseas, citing in a 53-page ruling a case where records were found of assets being held by a Swiss bank in Zurich.
“The new chief justice is phenomenal,” said Rahul Bajaj, the chairman of Pune-based Bajaj Auto Ltd., India’s second- largest motorcycle manufacturer. “So many businessmen and politicians who thought they were untouchable are now scared.”
India’s government has been assailed by a stream of corruption scandals over the last year, including the resignation of two ministers tied to the sale of telecommunications licenses. That, along with the misuse of funds for the Commonwealth Games, helped trigger nationwide protests demanding a new anti-graft agency which can investigate the prime minister and judges.
“Kapadia is providing accountability, which is what the public mood has been crying out for,” said Raj Kumar, a law professor and vice chancellor of Jindal Global University in the state of Haryana. “There has been such distrust in the Indian establishment over the last eight or nine months, and he is providing some much-needed respectability.”
Underscoring the challenges India faces tackling government corruption, the top minister of Karnataka state last week said he would resign after being accused of taking bribes from companies illegally mining minerals. The scandal may have cost the government about $3.6 billion in lost revenue.
Kapadia, whose predecessor is being investigated by Indian tax authorities, said in his April speech that judges must lead an exemplary life, “the keystone of modern judicial conduct.” While his rulings have made him front-page news in India, Kapadia has yet to grant an interview to the media and declined to comment.
“A judge must inevitably choose to be a little aloof and isolated from the community,” the 63-year-old said in the speech.
While India’s top court is now acting where the government hasn’t -- for example stopping companies mining in areas of mineral-rich Karnataka state to protect the environment -- in the past other chief justices were closely aligned to the executive, said Bhagwan Dua, a professor at Canada’s University of Lethbridge.
Prime Minister Manmohan Singh cautioned that the court may be overreaching after it ordered the government to release food stocks to the poor -- a response to litigation following media reports of wheat and rice rotting in official warehouses.
“The Supreme Court, I think, should not go into the realm of policy formulation,” Singh said at the time. “Those should remain the concern of policy makers and the government.”
K.K. Venugopal, a Supreme Court lawyer, says the vigorous way that Kapadia has responded to a range of public interest litigation marks a break with the past and has empowered other judges to hold the government to account.
“He has brought about a completely new dimension” to the role of chief justice, Venugopal said in an interview. “When he sets an example, then other judges become emboldened to take the same type of action.”
The Supreme Court was instrumental in exposing India’s biggest case of political corruption by overseeing the probe into the sale of mobile-phone licenses, which the country’s chief auditor estimated cost the state $31 billion. The Delhi High Court had rejected an earlier plea to do so.
Former Telecoms Minister Andimuthu Raja, billionaire Shahid Balwa, a managing director of Mumbai-based DB Realty, and nine other executives await trial on charges of rigging the auction. They have all denied any wrongdoing.
In March, the Supreme Court forced the resignation of P.J. Thomas, the head of India’s anti-corruption unit and whose appointment was approved by Singh, over allegations he accepted a contract for importing palm oil at inflated prices in 1992.
Last month’s work included ordering an Indian state to disband a locally trained militia used to back up the police fighting a Maoist insurgency, as well as the establishment of the team to pursue illegal funds in foreign banks.
UBS AG in February denied allegations discussed at the court that documents from the bank showed it assisted an Indian businessman in money laundering. The court’s July ruling repeated those claims.
While Kapadia has helped hold the government to account, he doesn’t deserve all the credit for the judiciary’s new found activism, according to Laveesh Bhandari, a director of Indicus Analytics, an economics research firm based in New Delhi.
“His influence is not as great as people say,” Bhandari said. “He is just one of a number of strong and independent voices in the judiciary.”
Kapadia, the longest serving Supreme Court judge at the time, was named India’s chief justice by President Pratibha Patil in May last year. He is due to step down next year, when he reaches the retirement age of 65.
Kapadia is allotted a government bungalow in Delhi’s Lutyen’s district. His family’s assets, including his wife’s, don’t exceed $250,000, according to a declaration he made when appointed.
A lawyer since 1974, he specialized in legal disputes involving land valuations, pensions and taxes before being appointed an additional judge of the Bombay High Court in 1991. His first job in law was as an office boy in a Mumbai law firm carrying briefcases to court.
When selected to head India’s top court, he wrote about his upbringing in a letter to a former judge. He noted that he began government service in an entry-level position, as a “class IV” employee.
“I come from a poor family,” he wrote to former Supreme Court Judge V. R. Krishna Ayer. “The only asset I possess is my integrity.”
--With assistance from P.S. Patnaik and Bibhudatta Pradhan in New Delhi and Siddharth Philip in Mumbai. Editors: Douglas Wong, David E. Rovella