The fodder scam (Chara Ghotala) was a corruption scandal involves taking of hundreds of millions of dollars in alleged fraudulent reimbursements from the district treasuries of Chaibasa, Ranchi, Dumka, Gumla, and Jamshedpur in Jharkhand and Banka in undivided Bihar. The fodder scam was expected to be worth Rs 950 crore (in dollar conversion, today it would be about Rs 2,255 crore). The scam was about supplies for livestock like feed, medicines, and other materials.

Among those accused and arrested in this scandal was the chief minister of Bihar, Lalu prasad Yadav, as well as former chief minister Jagannath Mishra. The scandal broke in 1996 but it, increased in size continued over for two decades.

It involved politicians, bureaucrats belonging to successful administration result in theft of crores of rupees from the government treasury in the name of purchasing feed, medicines for livestock for over a period of 20 years.

It was one of first kind of case where sitting politicians were found guilty and compelled to resign from their positions in assembly and parliament.


During the 1966-67 drought occurred in Bihar state, during this time wholesale price of food grains in Bihar had increased compared to other states. The production of food grains has dropped from 7.5 billion tons in 1965-66 to 7.2 billion tons during 1966-67 and also the production decreased later on. The rise in food grains caused migration and starvation the relief measures by the govt, voluntary organizations had resulted in less limited impact. The scam is said to have started with small scale embezzling of money by the government officials filling expense reports. After that the scam grew wider including more no of persons like businessman, politicians until it became a full-fledged empire. The first chief minister of Bihar, Jagannath Mishra who served as CM for first time during the mid 1970era also accused of this scam.

In 1977, scam was perpetrated in the districts of the southern states of Bihar (later became Jharkhand in 2000). Until 1990 the unlawful withdrawal of money from government and exchange of money between the animal husbandry and suppliers remained undiscovered. It came into light for the first time when Yadav became chief minister of Bihar in 1990. Instead of reacting to it, he let things continued as it is and obtained his share. The amount of withdrawn from treasury increased between 1990 and 1996. A large portion of amount 950 crores withdrawn during Yadav tenure as chief minister.

 During 1985, T.N. CHATURVEDI the then Comptroller Auditor General of India (CAG) of India noticed the late submission of monthly account submissions by the Bihar state treasury and departments and wrote to the Chandrasekhar Singh chief minister of Bihar warning him this could be reflective of temporary embezzlement. This led to warnings to the Bihar govt by the Principal Accountant General and CAGs to various chief ministers of state during their tenure but ignored by them.

In 1992, Bidhu Bhushan Dvivedi, a police inspector of state Anti-corruption vigilance filed a report describing fodder scam and suspected involvement at chief minister level to the Director General of same unit G. Narayan.

RAID IN 1996

The deputy commissioner of the animal husbandry department, Amit Khare commissioned a raid in 1996. The papers recovered in raid found that money was misappropriated under pretence of supplying feed to livestock. It started with small-scale fraud executed by low-level government officials and gradually expanded to involve politicians and businesses.


  The state government established two commissions in midst of raids.  One of them led by Phool Chand commission, who later involved in scam as a result got cancelled. Later on many FIRs was filed by the Bihar police under state government directions and many PILs were filed in Patna High Court seeking matter to be transferred to CBI.

In march 11, 1996 Patna High Court delivered Excess withdrawals in the Department of Animal husbandry occurring since 1977-78, so the court included the years 1977-78 through 1995-96.

Further the court ordered CBI to investigate and scrutinize all cases of excessive withdrawals and expenditure in the Animal Husbandry Department in the state of Bihar from 1977-78 to 1995-96 and to complete investigation possibly within 4 months.


Following the orders of the court began investigating 41 cases registered by state police and 23 cases registered based on intelligence reports and complaints totally looked into 64 fodder scams. The CBI filed first FIR in Chaibasa treasury case. In June 1997 CBI asked permission of governor of Bihar to prosecute Yadav who was CM at that time and filed charge sheet against him and other 55 persons under sec 420 (forgery), 120(b) of IPC, as well as sec 13(b) of the Prevention of Corruption Act.


Once Lalu named in the charge sheet there was political fallout. He was member of Janata Dal, opposed him as continue as CM, resigned as cm but appointed his wife Rabri Devi as chief minister.  

In 2001, the state of Jharkhand formed and cases are transferred there. It mentions that scamsters adopted unique methods making fraudulent and surplus withdrawal from treasuries in Bihar and submitting fake bills and some cases partial supply of fodder, feed, medicine, instruments and other materials.


The first Trail in fodder scam case was began in February 2002. A total of 170 persons were charged, 55 out of them are dead, seven govt witness, six fleeing and two accepting allegations. In march 2012 Mishra and Lalu were incriminate of fraudulently withdrawing money from Bhagalpur and Banka districts. In September 2013, Yadav was found guilty for stealing Rs.37.7 crores from Chaibasa treasury and sentenced to five years prison, but in Dec 2013 supreme court granted him bail, however his conviction barred him from contesting in election.


In 2017 the special CBI court found him guilty in the second scam, involves withdrawal of 89.27 lakh from the Deoghar treasury in dec 2017. He was found guilty sentenced to three and half years prison and 10 lakh fine in other case. He was granted bail after serving 3.5 years sentence.


Yadav was convicted in the third case in January 2018 for fraudulently withdrawing 33.13 crores from Chaibasa treasury, sentenced to five years in prison.


Yadav was convicted for fourth time in Dumka treasury case. He was convicted in march 2018, for illegally with drawing of 3.76 crores from dumka treasury between December 1995 and Jan 1996.He was sentenced to 14 years prison and fine of 60lakh for fraudulently withdrawing 3.76 crore from the treasury.


In this case illegally withdrawn of 139.35 crore from Doranda treasury (Ranchi), Yadav was sentenced to five years in jail and a fine of 60 lakhs. This was last instance in which Yadav has been accused of a fodder scam.


The case continued nearly two decades and on 13th September 2013, a special CBI court in Ranchi convicted Lalu prasad Yadav and Jagannath Mishra along with 44 others in the case. 37 people were taken into judicial custody. The court has announced five and four years for Lalu and Jagannath Mishra, respectively. 


Lalu prasad Yadav was found guilty under sections 120B, 409, 467, 468, 471, 477A OF IPC and SECTION 13 in THE PREVENTION OF CORRUPTION ACT ,1988.


SEC 409 OF IPC, whoever being in any manner entrusted with property, or with any dominion over property in his capacity of a public servant or in way of his business, as a banker, merchant, factor, broker, attorney, or agent, commits criminal breach of trust in respect that property, shall be punished with imprisonment of life or imprisonment which may extend to10years, as well as fine.


Whoever cheats and thereby Dishonestly induces the person decided to deliver any property to any person, or to make, alter or destroy the whole or any part of a valuable security, or anything which is signed or sealed, and which is capable of being converted into a valuable security, shall be punished with imprisonment of either maximum seven years and also be liable to fine. 


If someone forges a document that pretends to be valuable security, will, adoption authority, or any authorization for financial transactions or property exchanges, they can be punished with life imprisonment or imprisonment for up to ten years, and also liable to pay fine.

SEC 468 

Whoever commits forgery, intending that the document or electronic record forged shall be used for purpose of cheating, shall be punished with imprisonment of either description for a term which may extend to seven years, and shall be liable to fine.

SEC 471

Whoever fraudulently or dishonestly use as genuine any document which he knows or has reason to believe to be a forged document, shall be punished in the same manner as if he had forged such document. 

In the case of AS Krishnan & Anor v. State of Kerala, the supreme court stated in explaining the purpose and application of Section 471, The essential elements of sec 471 are:

(I) dishonest or fraudulent use of the document as genuine; and 

(ii) knowledge or reasonable belief on part of the person using the record/document that the document is forged.

SEC 477A Falsification of Accounts 

It deals with two things: 

Deceiving, destroying, manipulating, mutilating, or fabricating any book, account, or electronic record; and creating or assisting in the making of fraudulent entries in the same way. These two are not interdependent and are distinct.

The punishment provided is either imprisonment of any description for a term up to seven years, a fine, or both.


Any public servant who commits criminal misconduct shall be punishable with imprisonment for a term which shall be not less than one year but which may extend to seven years and shall also be liable to fine.


The fodder scam described as one of the biggest Scam in India continued two decades, later exposed in mid 1990s. It was one of the Scam in which sitting politicians are found guilty and compelled to resign from their positions in Assembly and Parliament. Officials of the Animal Husbandry Department have been accused of stealing money from treasuries in name of feed, medicine and artificial insemination equipment for livestock.  

With the intervene of CBI court after its investigation convicting Lalu prasad Yadav in the fodder case, crushing his lengthy political career in Bihar politics.






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