Author: Esha Jain, student at school of law, DAVV, Indore.
Abstract-
The Commonwealth scam, also known as the 2010 Commonwealth Games corruption scandal, was a major corruption scandal that occurred in India in the run-up to the 2010 Commonwealth Games held in New Delhi. The scandal involved a number of fraudulent activities, including the over inflation of costs for infrastructure projects, the siphoning of funds, and the award of contracts to companies with close ties to government officials. The scandal highlighted the widespread corruption that had permeated India’s public institutions, particularly in the area of large-scale infrastructure projects. This paper will delve with the various facets of the CWG scam, including the administrative and legal lapses that allowed the corruption to thrive, and discuss the broader ramifications for India’s public institutions in the wake of this scandal.
Introduction-
One of the biggest multi-sport events globally, the Commonwealth Games showcased talents of thousands of athletes from the Commonwealth of Nations-a voluntary association comprised largely of former territories of the British Empire, known as members of commonwealth group.
The prior known experience of India in hosting large-scale sporting events was limited.
The country, however, took up the challenge of hosting the 2010 Commonwealth Games with enthusiasm and determination. The holding of the Games was seen as an opportunity to take New Delhi into the league of the world’s leading cities. This led to the government shelling out heavily to create new sports infrastructure and to modernize existing ones.
The lead-up to the Games was marred by allegations of corruption and mismanagement, threatening to overshadow the sporting spectacle.
The controversy associated with the Commonwealth Games held in India is mostly about the 2010 New Delhi Commonwealth Games scandal. This scandal found embezzlement of significant funds, around Rs 70,000 crore, during the planning and execution phases of the event.
The above pie-chart represents central government, which was estimated to be Rs. 18,532 crores, given in Audit report on XIX Commonwealth Games (CWG-2010).
The vast gap between estimated and actual budget was filled by the scandal, almost all renowned people, including Suresh Kalmadi, the chairman of the organizing committee, faced legal consequences and were arrested for their role in corruption. This was accompanied by revelations of grave financial mismanagement and corrupt practices both by the organizing committee and government agencies that are associated with the event, faced intense scrutiny and criticism from both domestic and international observers, who accused them of misappropriating funds, awarding inflated contracts, and neglecting the needs of the common people.
According to the report of The Times of India published on 7th Feb, 2020, It was expected that only fifty percent of the allocated funds were used for the Indian athletes. The athletes were apparently asked to relocate to dilapidated apartments rather than the one that was allotted to them by the officials.
Background of the case
The Commonwealth Games scam, also known as CWG scam, came to light in 2010 after the conclusion of the games in Delhi. Several irregularities and instances of corruption related to the organization and management of the event were uncovered by investigative agencies and media reports.
The preparations for the games were plagued by a range of issues, including extravagant spending, shoddy construction work, and poor planning, which collectively raised serious doubts about the government’s competence in hosting such a large-scale international sporting event.
Facts of the events-
Event Overview-
The 19th Commonwealth Games were held in New Delhi, India from October 3-14, 2010, showcasing 17 sports and 15 para-sporting events, featuring 71 countries. The games presented a singular opportunity for India to showcase itself as a rising global power, with a goal of transforming New Delhi into a “world-class city.
Organizing Body-
The Commonwealth Games Organizing Committee(CGOC) was responsible for the planning and execution of the games, working in coordination with India’s Ministry of Youth Affairs and Sports and the Delhi government.
Suresh Kalmandi’s hand in the commonwealth scam
Suresh Kalmandi, the organizing committee chairman for the 2010 commonwealth games held in new Delhi, India, has been at the center of a major controversy surrounding financial irregularities and mismanagement of funds during the preparation and hosting of the games. He was accused of awarding the timing equipment to Swiss Timing in a contract of ₹141 crores, and it was suspected that the award was inflated by ₹95crores. Charges of conspiracy, forgery, corruption, money laundering and misconduct against him were preferred under the Prevention of Corruption Act, and he was arrested in April 2011 and later let out on bail. The scandal highlighted the challenges faced by India in hosting a major international sporting event, and the potential for corruption and misuse of public funds. the games, which were meant to showcase India’s progress and development, instead became a symbol of the country’s ongoing struggles with graft and lack of transparency in public projects.
CBI Probe in commonwealth scam of 2010 in India-
The CBI played an important role in investigating the scam of the 2010 Commonwealth Games in India. The scam involved allegations of financial misappropriation, inflated contracts, and procedural irregularities during the preparation of the Games held in New Delhi.
Such major figures include the Chairman of the Organizing Committee, Suresh Kalmadi. Contracts were handed over without due tenders, hence costs for services and infrastructure inflates. Criminal conspiracy, cheating, forgery, and the violation of Prevention of Corruption Act charged Kalmadi and the rest.
The CBI investigation showed that amounts designated for infrastructural development and event management were illegally diverted through corrupt means. The report of the Comptroller and Auditor General of India also encompasses procedural lapses, such as intentional evasion of standard procurement procedures and over-billing.
The Trial –
The trial for the Commonwealth Games scam of 2010 was one of lengthy litigation. Central Bureau of Investigation (CBI) also submitted many charge sheets against main figures like Suresh Kalmadi, the then Chairman of the Organizing Committee. It also included criminal conspiracy, cheating, forgery, and violation under the Prevention of Corruption Act.
The trial witnessed many delays and extensions over the years. In September 2022, nearly 11 years after the case was lodged, the trial against former Organizing Committee members and others finally began. The special CBI court took cognizance of the charge sheet and issued summons to the accused.
The legal proceedings have been complex, involving numerous accused individuals and companies. The CBI has alleged that public servants abused their official positions, causing significant financial losses to the government.
Major allegations and charges
1. The first major allegation – was regarding the inflated costs of the construction projects related to the games. For instance, the cost of the main stadium was initially estimated at ₹389 crore, but the final cost escalated to a staggering ₹961 crore, leading to allegations of large-scale corruption and financial mismanagement.
2. The second major grounds of issues- budget for the games village, which was intended to house the athletes, was also massively increased from the original estimate “leading to the large scale corruption”.
Scam in gaming village has featured various allegation such as inflated payments for construction and unfinished and substandard accommodations for athletes. over 71 countries participated in the 2010 commonwealth games and the city of New Delhi hosted the event. The games were plagued by various issues throughout the planning and execution phases, such as missed deadlines, poor organization, and widespread corruption allegation.
3. Scam in tickets – Allegations of inflated prices and black marketing of tickets were leveled against the organizers. The tickets were allegedly sold at much higher prices than what was advertised, with the excess revenue being pocketed by corrupt officials.
4. Collapse of foot over bridge-
One of the most profile incidents was the collapse of a foot over bridge near the main stadium, just before the event within 12 days, injuring over 20 people. this brought to light the poor construction and shoddy workmanship that plagued the infrastructure development for the games.
5. Exploitation-
Reports also emerged of exploitation of construction workers involved in the rapid infrastructure development for the games, with workers allegedly being subjected to poor living conditions and wages far below the legal minimum.
6.Financial corruption in the event-
Several instances of final corruption improprieties were alleged, with officials accused of inflating costs, siphoning off funds, and awarding contracts to compliant parties in exchange for kickbacks. The creation of a special purpose vehicle to handle the organization of the games was intended to improve transparency, but it appears to have had the opposite effect.
Types of crimes involved in the case-
1. Investment Management-
In the lead of the 19th edition of the Commonwealth Games held in New Delhi in 2010, there were widespread reports of financial mismanagement and corrupt practices surrounding the event’s organization and execution. The games were plagued by misappropriation of funds and outright misuse of public money for private gains.
2. Corruption-
Beyond financial irregularities, there were also allegations of widespread corruption, nepotism and a lack of transparency in the awarding of contracts and tenders related to the games infrastructure and operation. Sec 7 of The Prevention of Corruption act,1988, Public Sevant taking gratification were allegedly violated.
3. Unauthorized Expenses-
The excessive spending on infrastructure and facilities, much of which was deemed unnecessary or exorbitantly priced, drew significant public scrutiny and criticism.
Procurement Fraud- The games organization committee was accused of favoring certain vendors and contractors with inflated costs and dubious procurement practices.
4. Procurement Fraud-
The games organization committee was accused of favoring certain vendors and contractors with inflated costs and dubious procurement practices.
5. Political Interference-
There were also allegations of political interference and cronyism in the decision making process for the games.
6.Land Grabbing-
Land acquisition and clearing of slums for the construction of games venues and facilities were criticized as being heavy-handed and lacking transparency.
7. Conspiracy-
Sec120B of IPC- Bribery of public officials, kickbacks and other forms of collusion between bureaucrats, politicians and private players were alleged in the games related contracts and projects.
8. Legal Violations-
Numerous instances of violation of various laws, including the Indian Penal Code (IPC) section 420 (Cheating) and 406 (criminal breach of trust). 506 (criminal intimidation) and sec 12 of the Prevention of Corruption Act, 1988.
9. Regulatory failures-
failure of various scam prevention acts were reported, including the Foreign Exchange Management Act, Income Tax Act, Prevention of Corruption Act, and Central Vigilance Commission guidelines.
10. Forgery and Fabrication-
Ipc- Sec 201 (destruction of evidences), 467 (forgery of valuable security), 468 (forgery along with the aim of cheating), 471 (offences related forgery). Reports suggest that documents were forged or falsified to cover up the misappropriation of funds and to justify the inflated costs.
Impact on various sectors-
1.India as a country- India had the opportunity to showcase itself as a rising economic power and a global destination for sports events. The scam tarnished the reputation of the games and raised concerns about India’s ability to host major sporting events.
2.Public Trust- The scam led to a loss of public trust in the government and its ability to manage public funds.
3.Sports development – The scandal diverted attention and resources away from sports development initiatives, hindering the growth of sports in India,
4.Tourism- The negative publicity surrounding the games deterred potential tourists
from visiting India, impacting the tourism industry.
5.Authenticity – The scam undermined the authenticity and integrity of the games, questioning India’s commitment to fair play and transparency.
Overall, the 2010 Commonwealth Games scam in India had far-reaching consequences across various sectors, damaging the country’s reputation and impacting its long-term development. The Government to overcome these impacts have introduced some major reforms for better oversight and transparency to prevent such incidents in the future.
Conclusion
To mitigate the risks of such scandals in future large-scale sporting events hosted by developing nations, stringent anti-corruption safeguards and enhanced transparency throughout the planning and execution phases are critical. As evidenced by the 2010 Commonwealth Games, the hosting of such events can provide an opportunity for massive corruption if not handled properly. The failure of the 2010 Commonwealth Games organization also highlights the need for closer scrutiny and oversight by international governing bodies like the Commonwealth Games Federation to ensure hosting cities adhere to the highest standards of integrity and accountability along with that the government of India also needs to strengthen the legislative and regulatory framework, increase public oversight, and enforce strict accountability mechanisms to prevent the recurrence of such scandals in future major sporting events.
FAQS
Q1: What were the main allegations surrounding the 2010 Commonwealth Games in India?
A: The main allegations included financial irregularities, inflated costs, delays in infrastructure development, and corruption in awarding contracts. There were also concerns about shoddy construction work, security issues, and the displacement of slum dwellers.
Q2: Who were the key figures implicated in the scandal?
A: Key figures included Suresh Kalmadi, the head of the Organizing Committee, and other officials like Lalit Bhanot and V K Verma. They were accused of embezzlement, favoritism in awarding contracts, and inflating costs.
Q3: How much money was reportedly mismanaged or lost due to the scandal?
A: The total cost of the Games ballooned to around ₹70,000 crores (approximately USD 10 billion), far exceeding the initial budget of ₹1,620 crores (about USD 230 million).
Q4: What was the international reaction to the scandal?
A: The scandal drew widespread criticism from the international community, damaging India’s reputation as a reliable host for major sporting events. It also highlighted systemic weaknesses in governance and public administration.
Q5: What were the long-term consequences of the scandal?
A: The scandal prompted calls for greater transparency and accountability in sports management and government expenditures. It also influenced policies aimed at preventing similar incidents in future international sporting events.
References
2.Pg-86 , fig 6.1 Budgeting for CWG-2010
4.https://timesofindia.indiatimes.com/miscellaneous/commonwealth-games-scam/articleshow/56032112.cms
5.https://www.slideshare.net/slideshow/cwg-scam/6734560
6.https://www.frontiersin.org/journals/public-health/articles/10.3389/fpubh.2023.1068023/pdf
