Rail Neer scam: 3 accused sent to police custody till Oct 23

New Delhi, Oct 19: A special court on Monday sent two senior rail officers and a businessman arrested in connection with the alleged corruption in supply of packaged drinking water in Rajdhani and other superfast trains to five-day CBI custody.

Special CBI Judge Vinod Kumar remanded the three accused to CBI custody till October 23 after the agency submitted they were required to be interrogated to unearth the larger conspiracy and also for recovery of certain documents.

Rail Neer Scam

The agency, which had sought six days police custody, said the two public servants -- Sandeep Silas and MS Chalia --were in conspiracy with arrested accused Sharan Bihari Agrawal and instead of taking Rail Neer, they had allowed some private firms to supply water in the trains which resulted in a loss of Rs 6.25 crore to the exchequer.

The agency alleged that searches were conducted during the probe in which approximately Rs 28 crore was recovered out of which around Rs four lakh was counterfeit.

CBI said that accused were not cooperating in the probe and they were required to be interrogated regarding some bank lockers in and outside Delhi and also in Agra.

The agency said both the arrested public servants, despite having knowledge, had not taken any corrective steps on the issue and they were required to be questioned about the alleged investments which they have made in various companies.

Countering CBI's argument, senior advocate Vikas Pahwa, who appeared for Chalia, told the court that his client was cooperating with the agency due to which he was not arrested on October 16 and 17 when the agency conducted the searches.

He said the case was of documentary nature and he did not know as to why his client was arrested when he was cooperating with the probe agency.

Pahwa also told the court that there was no flaw in grant of contract for supply of water and if at all there was any flaw, it was in the execution for which his client cannot be held responsible.

The counsel also argued that CBI has not given them a copy of FIR and none of the grounds given in the remand application showed that police custody of accused was needed.

Silas, a 1984-batch Indian Railway Traffic Service(IRTS) officer, and Chalia of 1987 batch officer were taken into custody on Saturday night along with Agrawal, owner of R K Associates, in connection with the scam. 

During the arguments, the counsel appearing for Agrawal stated that in the contract entered into between his firm and the railways, they have been told to procure and distribute the water to the passengers travelling in trains.

His counsel said that it was not the case of CBI that his client had refused to take Rail Neer for supply in trains. He said that when there was a shortage of Rail Neer, they supplied another branded water product, like Parle, which was approved by the Railways.

He also placed before the court an RTI reply received from the Railways saying that department was itself agreeing that there was shortage of Rail Neer for supply in the trains.

Regarding the case amount recovered during the searches, he said that his client is a businessman and the money which was recovered was kept in his house for business purposes.

The defence counsel said that Agrawal was a 70-year-old person and he was doing his business only so there was no need to remand him to police custody as he has cooperated with the probe and there was no apprehension that he will run away.

Similarly, the counsel appearing for Silas told the court that contract was not awarded by his client and no illegality was committed by him. Both officers were suspended after CBI carried out searches at their residences.

The recovery has taken the total cash to be around Rs 28 crore during its searches. CBI has registered a case against Chalia, Silas and seven private companies—RK Associates Pvt Ltd, Satyam Caterers Pvt Ltd, Ambuj Hotel and Real Estate, PK Associates Pvt Ltd, Sunsine Pvt Ltd, Brandavan Food Product and Food World—under the provisions of Prevention of Corruption Act.

It is alleged that the two accused officials, who held the position of Chief Commercial Manager, had shown favour to these private firms in supply of cheap packaged drinking water other than 'Rail Neer' which is mandatory in premium trains including Rajdhani and Shatabdi.

CBI had said that the Railway Board had prescribed that IRCTC shall provide Rail Neer at the rate of around Rs 10.50 per bottle to private caterers and they would be paid (approx) Rs 15 per bottle for supplying the same to the passengers in premium trains.

However, in order to make undue gains, private suppliers were allegedly supplying cheap packaged water, other than 'Rail Neer', available in the market at a rate of Rs 5.70 to Rs 7 (approx) per bottle, thereby making profit for themselves and loss to the exchequer.

CBI said the directions of Railway Board to ensure supply of 'Rail Neer' in premium trains were also ignored by the officials thereby causing undue pecuniary advantage to private parties and corresponding loss to the IRCTC.


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