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'Mr Finance Minister, you are
not serving the country well'

Sheela Bhatt in New Delhi

Finance Minister Yashwant Sinha expectedly came in for a lot of flak in the Lok Sabha on Thursday during the debate on the adjournment motion on the Unit Trust of India crisis. But equally scathing was the attack on UTI's investments in Reliance Industries Limited.

In a bid to defend Sinha, the treasury benches turned their guns on the Reliance deal, accusing the Congress government of the early 1990s of having invested an inexplicably large sum of money in the company in 1994 at a six times higher rate.

Kirit Somaiya of the Bharatiya Janata Party, Rashid Alvi of the Bahujan Samaj Party and George Fernandes of the Samata Party reminded the House about the UTI's alleged misdeeds in the past.

Law Minister Arun Jaitley did not name Reliance, but said: "In 1994 two large investments of Rs 300 crore by way of non-convertible debentures and Rs 773 crore by way of equity shares were invested in a well-known Bombay business house. What is curious is that there was a five-year lock-in period in the purchase of these shares. There was an obvious disadvantage in terms of the risk of equity investment, but no advantage of security of returns."

Former defence minister Fernandes said Jaitley had not mentioned the name of the 'Bombay business house' because he was a minister, but he would not fight shy of saying that it was the Reliance Group.

Calling the "so-called UTI scam" a conspiracy against the government, Fernandes, the wounds of the Tehelka tapes scandal apparently still fresh, blamed the same people for the latest embarrassment.

"We have been told that UTI had invested in 1426 private companies and out of them 1354 companies are not traceable. While investments in 81 companies have been appreciated, these decisions have reduced the value of UTI's total investments by 47 per cent," said Fernandes.

He also alleged that the previous government had scuttled the Central Bureau of Investigation's inquiry into UTI's investments in Reliance and Y P Singh, the superintendent of police who had led that investigation, was transferred.

Veteran Marxist politician Somnath Chatterjee sought special permission from the chair to speak at the end of the day and straightaway waded into the finance minister.

"I am shocked," he said, "to hear the finance minister's speech saying that UTI is an autonomous corporation, what can I do? I am not a telephone operator of UTI. I am not sitting in the boardroom of UTI. I am a humble powerless finance minister. I can't do anything."

Chatterjee reminded Sinha that UTI was born under a statute of Parliament. "Under that law's section 3A no other company in India can use the word 'unit' in its name. It has got its capital from the RBI, GIC, LIC and State Bank of India. All these companies are government-owned. Top officials of these companies are on the board of UTI. Bonds issued by the UTI are guaranteed by the Government of India under the UTI Act and under section 42 of the same act UTI cannot be liquidated. And still the finance minister says he is not responsible!"

Chatterjee had few kind words for HDFC chairman Deepak Parekh. He wanted to know why his committee's recommendations were not considered. He wanted to know whether Sinha knew before July 3 what had been happening in UTI.

Looking at Sinha, who was sitting right opposite him, Chatterjee declared that he had "forfeited his right" to occupy the chair in Parliament when he said he didn't know about the inside happenings of UTI. "Mr Finance Minister, you are not serving the country well. You should quit," he told a grim-looking Sinha.

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