The Yeddy Diaries

Pages with income tax note payoffs to BJP—150 crore each to Jaitley and Gadkari; 100 crore to Rajnath Singh; 50 crore each to Advani and Murli Manohar Joshi

Rajnath Singh, BS Yeddyurappa and Arun Jaitley in 2009 (left to right). Shekhar Yadav/India Today Group/Getty Images
22 March, 2019

Documents accessed by The Caravan reveal that the income-tax department is in possession of copies of diary entries in the handwriting of the prominent BJP leader and the former chief minister of Karnataka, BS Yeddyurappa, that note payoffs amounting to over Rs 1,800 crore to the BJP’s national leaders, its central committee, and judges and advocates. Yeddyurappa recorded these alleged payouts in a Karnataka state assembly legislator’s 2009 diary, in Kannada, in his own hand. Copies of these entries have been with the income-tax department since 2017. The copies of the diary pages note that Yeddyurappa paid the BJP Central Committee Rs 1,000 crore; that he paid the finance minister Arun Jaitley and the transport minister Nitin Gadkari Rs 150 crore each; that he gave the home minister Rajnath Singh Rs 100 crore; and that he paid the BJP stalwart LK Advani and the senior party leader Murli Manohar Joshi Rs 50 crore each. Besides this, the entry notes, Yeddyurappa paid Rs 10 crore for “Gadkari’s son’s marriage.” The diary entries also state that Yeddyurappa paid Rs 250 crore to “judges” and Rs 50 crore to “Advocates (fee paid for cases),” but does not mention any names.

The entries regarding payments to the BJP leaders, judges and advocates were written against rows dated 17 January 2009, while the entry regarding the BJP central committee was written against rows dated 18 January 2009. It is unclear whether the entries were made on these dates or written in the diary on a later date. Yeddyurappa served as the chief minister in Karnataka from May 2008 to July 2011. Each of the copies of the pages accessed by The Caravan bears his signature.

Information available with The Caravan shows that the income-tax department and the BJP government at the centre have been sitting on copies of these entries since August 2017. A senior income-tax official took copies of Yeddyurappa’s diary entries to the finance minister Arun Jaitley, along with an unsigned cover note. The senior IT official asked in the note whether further investigation by the Enforcement Directorate—India’s top law-enforcement agency for financial and economic crimes—was viable. But Jaitley, who is named in the entries as having allegedly received Rs 150 crore from Yeddyurappa, chose not to act on the income-tax official’s note. Jaitley was incharge of the Karnataka BJP between 2004 and 2013, and oversaw the party’s state unit during the elections held in this period.

The Caravan sent queries to Yeddyurappa, Jaitley, Gadkari, Singh, Advani and Joshi, seeking their responses to the contents of the entries. At the time this report was published, none of the leaders had replied. The report will be updated if they respond.

In addition to the list of alleged payouts to the BJP’s central leadership, the diary entries include amounts allegedly paid to state legislators in Karnataka, many of whom were instrumental in helping Yeddyurappa secure the chief minister’s seat in 2008. In the assembly election that year, Yeddyurappa scraped together a majority in the state by luring away several leaders who won on tickets of the Congress or the Janata Dal (Secular), or as independents. Five of the six independent candidates who supported Yeddyurappa at the time were later appointed to his cabinet. Several of these leaders are named in the diary.

The copies of the pages accessed by The Caravan include an entry that begins: “Gali Janardhana Reddy is the key person to make me CM,” and is signed by Yeddyurappa. The next line reads: “Details of persons for whom, money is given by Janardhan Reddy.” The entry notes payments amounting to Rs 150 crore allegedly given to eight leaders. The names in the entry include PM Narendraswamy, who won as an independent in 2008, and was appointed the minister for women and child development in Yeddyurappa’s cabinet; Anand Asnotikar Vasant, who won on a Congress ticket, and was appointed the minister for fisheries, science and technology; and Balachandra Laxmanrao Jarakiholi, who won on a JD(S) ticket, and was appointed the minister for municipalities and local bodies. Asnotikar subsequently quit the BJP to join the JD(S), in January 2018. Seven of the eight leaders have amounts of Rs 20 crore written next to their names. An entry for Goolihatti Shekhar, an independent candidate who was subsequently appointed the sports and youth affairs minister in Yeddyurappa's cabinet, notes that he was allegedly paid Rs 10 crore. The Caravan sent queries to all eight legislators, but did not receive a response.

The entry, in Yeddyurappa’s hand, notes that Gali Janaradhana Reddy made the alleged payments to the politicians. Reddy is one of Karnataka’s richest politicians. He was appointed the minister for tourism and infrastructural development in Yeddyurappa’s government in 2008. The CBI arrested him in September 2011 from Bellary, in association with an illegal-mining case, and he subsequently spent three years in jail before he was released on bail in 2015. Reddy was arrested again in November 2018, on the charge of receiving nearly Rs 20 crore by a private company accused of defrauding thousands of investors. He was sent to judicial custody, and is currently out on bail. In December 2018, a special investigation team looking into an illegal iron-ore mining case named Reddy in its chargesheet as an accused. Karnataka’s Lokayukta—a corruption ombudsman—had also named him the main accused in the Belekeri port case, a Rs 35,000-crore illegal iron-ore mining scam. But the Central Bureau of Investigation later closed this case, citing technical reasons.

Yeddyurappa, too, faced charges of corruption—in 2011, he was arrested and sent to judicial custody. He was indicted by the Karnataka Lokayukta for diversion of government land and receiving kickbacks in a mining scam. The allegation brought down his government—he was compelled to resign as chief minister in July that year, and later surrendered before the special Lokayukta court, in October. The BJP dismissed him, and he subsequently revived the Karnataka Janata Paksha, a party that Padmanabha Prasanna Kumar had first registered in 2008. But in 2014, ahead of the Lok Sabha elections that year, Narendra Modi and Amit Shah brought Yeddyurappa and the KJP back to into the BJP’s fold. Yeddyurappa was later acquitted in these corruption cases. He was the BJP’s chief ministerial candidate in the 2018 assembly elections, and currently is the leader of the opposition in the state.

The diary entries accessed by The Caravan also include a list of 26 people, under “Money received/ paid to me,” with amounts ranging from Rs 5 crore to Rs 500 crore. The entries note that the donors gave Yeddyurappa Rs 2,690 crore. Among others, the entry names former state cabinet ministers from the BJP, such as Basavraj Bommai, Aravind Limbavali and Murugesh Nirani; the BJP leader K Subramanya Naidu; and BJP MLAs such as J Krishna Palemar, CC Patil, and Laxman Savadi, all three of whom were once caught watching pornographic clips during assembly proceedings. Most donors named in the entry did not respond to calls from The Caravan. The few that did either denied the payment or claimed ignorance of any donation. The Prerana Trust, which is managed by Yeddyurappa’s family, is listed as having paid Rs 500 crore. Yeddyurappa’s daughter SY Umadevi denied that the trust had made such a payment.

From Yeddyurappa to IT Department, via DK Shivakumar

The Caravan has confirmed that the Income Tax department seized copies of these diary pages during a raid on the residence of DK Shivakumar, a senior Congress leader in Karnataka, in August 2017. We also took copies of the diary pages to Shivakumar, who confirmed that the pages were seized from his residence, in 2017, but did not comment further. A senior Karnataka politician familiar with the raid and the documents seized confirmed to The Caravan that Yeddyurappa wrote the entries. “It is 100 percent him. No doubt about it,” he said.

Alongside the cover note presenting the diary pages to the finance minister Arun Jaitley, the senior IT official attached two documents, to confirm that the signature and the handwriting is Yeddyurappa’s. The first was a letter that Yeddyurappa had written in January 2017, to Sushil Chandra, who headed the Central Board of Direct Taxes at the time, urging him to take action against Shivakumar for his “irregularities and corruption.” The other was Yeddyurappa’s election affidavit, filed to the election commission, ahead of the 2013 assembly elections in the state. But there is no evidence that the income-tax department decided to take any further action on the matter. The Caravan contacted the CBDT as well, but at the time of publishing, no response had been received. The story will be updated if a response is received.

The senior IT official’s note also said that Yeddyurappa wrote these entries during the brief period in which he broke away from the BJP to revive the KJP. Local media had, at the time, widely reported a turf war between Yeddyurappa and senior BJP leaders in the state, such as Ananth Kumar and KS Eshwarappa. (Kumar died in 2018.) Journalists reported at the time that the personal assistants of these politicians were scrambling to secure their opponents’ papers—Yeddyurappa’s personal assistant allegedly attempted to kidnap his counterpart in Eswharappa’s office. During this time, Yeddyurappa’s personal staff procured his diary, which then reached the hands of other leaders like Ananth Kumar, according to the senior official’s note. “One of the copies of it was also given to DK Shivakumar and other leaders to raise the issue at the appropriate forum,” the senior IT official’s note said. Kumar had not gone to press with the pages as his “relationship with Yedyurappa was good,” the official wrote.

The IT department raided Shivakumar in August 2017, amid his efforts to stop the BJP from breaking up his party’s legislative unit in Gujarat, during a crucial Rajya Sabha election in the western state. In a nationally televised display of money and muscle power, Shivakumar moved 44 MLAs from Gujarat to a resort in the outskirts of Bengaluru, guarding them to prevent cross-voting. The Congress leader succeeded in keeping the fold intact and securing the win for the Congress’s Ahmad Patel, but he faced raids almost immediately. The Congress’s leaders in the upper house called the raids “an unprecedented witch-hunt.”

The senior IT official’s note continued: “The Income Tax Department just questioned D.K.Shivakumar over the diary and did not go further into it for taking statements by the members containing in this diary or issuing notices for them to take necessary action as per the law.” The senior official wrote that the IT department “protected the interests of the BJP leaders. Since this matter is connected to the BJP leaders of Karnataka and also in Delhi, no further investigation has been done till date.”

While taking the matter to Jaitley, the senior IT official had also laid out the need for further investigation into the diary’s contents, by either the Enforcement Directorate or any appropriate agency. The official wrote in his note that the IT department sought legal counsel: “Now the matter is to be examined, whether the original diary is to be procured and a case petition can be filed before the Supreme Court for further investigation by Enforcement Directorate or any other appropriate agency along with DK Shivakumar’s case filed by ED to make this diary is part of the investigation. So legal opinion is sought in this matter and bring the contents of the diary into the purview of investigation.”

The official’s note further stated that the BJP leaders had been black mailing Shivakumar, to break away from the ruling coalition of JD(S) and Congress in Karnataka, and join the BJP. “Since the Parliamentary elections are approaching, now the BJP national leaders are insisting through IT officials to break the coalition government and join BJP,” it said.

One page in the diary entry states that Yeddyurappa married the BJP politician Shobha Karandlaje. A controversy had erupted in Karnataka in 2016 when Padmanabha Prasanna Kumar, the founder of the KJP, held a press conference to announce that the former chief minister had married Karandlaje in a secret ceremony held in Kerala. While he was addressing the media, Prasanna was attacked—unidentified assailants poured a chemical mixture on him. The media reported Prasanna’s claim, and neither Yeddyurappa not Karandlaje denied it. Copies of the diary entry in The Caravan’s possession include an entry in Yeddyurappa’s hand that states: “After the demise of my wife Mytradevi I suffered loneliness severely. So, I married Shobha Karandlraje at Bhagvati temple of Chottanikkara in Kerala as per Hindu tradition and accepted her as my wife with Kaya Vacha Manasa in the name of Yediyuru Siddalinga.” The Caravan was unable to reach Prasanna. Karandlaje answered her phone. She claimed that “some mad people must have written the diary,” and then hung up. She did not answer subsequent calls.

Interestingly, Chandra, the CBDT head under whom the IT department raided Shivakumar’s residence and found copies of Yeddyurappa’s diary, is now an election commissioner of India. Yeddyurappa’s letter, which the IT official submitted to Jaitley as proof of the former chief minister’s signature, was addressed to Chandra. He was due to retire on May this year, but in February, the Modi government promoted him. Chandra is only the second officer from the revenue services to be appointed to the election commission.

Correction: An earlier version of this article incorrectly stated that the diary noted an entry of Rs 10 crore next to the former Karnataka state minister Balachandra Laxmanrao Jarakiholi's name. The diary records an entry of Rs 20 crore for Jalikaholi, and Rs 10 crore for Goolihatti Shekhar, a former sports minister. The Caravan regrets the error.