Chidambaram wants CBI to operate within prescribed limits

Finance minister P Chidambaram today said the Central Bureau of Investigation's (CBI), which is the country's premier investigating agency, must confine itself to policing and not question the laid out policy.

Speaking at the CBI's international conference on 'Evolving Common Strategies to Combat Corruption and Crime', Chidambaram cautioned the investigating agency to respect the line that divides policy making and policing.

Chidambaram said since the jurisdiction of CBI include cases in which the interests of the central government or of any public sector project or undertaking, or any statutory corporation or body set up and financed by the Government of India are involved, breaches of import and export control orders or serious cases of fraud, cheating and embezzlement relating to public joint stock companies, an independent, impartial and capable central investigation agency is more imperative than ever at present.

"It is not the business of the investigative agency to lay down a rule of conduct; nor is it the business of the investigating agency to presume a rule of conduct," the former home minister said.

Chidambaram said the investigative agency must confine itself to the question whether there has been a violation of a laid-down rule of conduct.

"Even where a rule has been prescribed, there is a policy behind that rule. It is not the business of the investigative agency to question the wisdom of that policy or to suggest a different policy that would be better in the view of the investigating agency," he said.

The scope of the jurisdiction of CBI is quite large, extending to the core of the financial system, which comprises tax authorities, banks, insurance companies, provident fund and pension fund authorities, regulators such as SEBI, IRDA and PFRDA, and other important players in the financial sector.

However, he said, since 1991, India has transited from a closed and controlled economy to an open and market economy.  The transition has brought in its wake both new opportunities and new challenges. Our laws have lagged behind.

He cited the recommendations of the Financial Sector Legislative Reforms Commission on dealing with 'market abuse', which has been excluded so far from the country's regulatory system.

The commission has recommended that market abuse and attempting or abetting market abuse must be made offences and must be punished with penalties extending to three times the illegitimate gains made or losses caused as well as with imprisonment.  It will, therefore, be evident that as new challenges emerge, new laws will be made, new offences will be defined, and new responsibilities will fall on investigating agencies. 

He said the investigating agency needs to be constructed in the emerging new India on the basis of clearly defined objectives, precisely enumerated powers and carefully designed accountability mechanisms, so that it does not breach its limits of power.

He said this approach is enshrined in the FSLRC report and he would commend the same approach while redesigning the country's investigating agencies, of which the CBI is the premier agency.