Satya Pal Malik Summoned 2nd Time For The Reliance Insurance Controversial Case

Satyapal Malik, the former governor of Jammu and Kashmir, received a summons from the Central Bureau of Investigation (CBI) on April 28, 2023. The CBI, the apex investigating agency in the country, requested that Malik answer questions related to an alleged Reliance insurance scam case.

This development came shortly after Malik made controversial comments regarding the 2019 Pulwama terror attack during an interview. Malik claimed that security lapses were responsible for the attack, which resulted in the deaths of 40 Central Reserve Police Force (CRPF) personnel. He also alleged that Prime Minister Narendra Modi had asked him to remain silent. It is worth noting that this is not the first time that the CBI has called Malik in connection with this case.

In October of 2021, Satyapal Malik made an allegation that while he held the position of Jammu and Kashmir governor, he was offered a bribe of Rs 300 crore to approve two files. These files concerned contracts for a group medical insurance scheme for government employees. One of the files related to a deal that the government had with Reliance General Insurance to provide health insurance to government employees which Malik had cancelled in 2018. The other file concerned civil works related to the Kiru Hydel Power Project.

In 2018, the Jammu and Kashmir governments launched the Government Employees Health Care Insurance Scheme, aimed at providing medical insurance to government employees and their dependents within the region. The scheme offers coverage for up to Rs. 6 lakh per annum, which covers expenses related to hospitalization, surgeries, and other medical treatments.

In 2020, the government selected Reliance General Insurance Company Ltd as the new insurer for the scheme. The selection of the company was based on a competitive bidding process, and Reliance General Insurance is now responsible for providing medical coverage to government employees under the scheme for a three-year period.

Reliance General Insurance provides a variety of health insurance plans that offer extensive coverage for medical expenses, including hospitalization, doctor’s fees, diagnostic tests, and medication. These plans also include additional benefits, such as cashless hospitalization, coverage for pre-existing illnesses, and tax benefits under Section 80D of the Income Tax Act.

The Jammu and Kashmir Government Employees Health Care Insurance Scheme was designed to provide government employees and their families with affordable and comprehensive health insurance coverage, and selecting Reliance General Insurance as the new insurer for the scheme is anticipated to enhance the coverage and benefits provided under the scheme.

In response to Malik’s allegations of bribery, J&K Lieutenant-Governor Manoj Sinha announced five months later that his administration would transfer the Reliance insurance and Kiru Hydel cases to the Central Bureau of Investigation (CBI).

Subsequently, in April of the following year, the CBI registered two FIRs against Reliance General Insurance Company Ltd and Trinity Reinsurance Brokers Ltd, in relation to allegations of misconduct in awarding the contract for the J&K Government Employees Health Care Insurance Scheme. The CBI investigation is expected to shed light on the alleged malpractices and bring to justice those involved in any wrongdoing.

According to the First Information Report (FIR) filed by the Central Bureau of Investigation (CBI), the allegations made by the Jammu and Kashmir administration suggest that certain officials from the Finance Department of the Government of J&K, in collusion with Trinity Reinsurance Brokers Ltd,

Reliance General Insurance Company Ltd, and other public servants and private individuals, abused their positions to commit criminal conspiracy and misconduct for their own financial gain. This caused financial harm to the state treasury during the timeframe from 2017 to 2018

When the J&K government floated the tender for group health insurance to government employees, only one bid was received. To help with the tender process, the government hired an insurance broker named Trinity, after which seven other insurance companies made bids. The premium paid by the state government amounted to Rs. 61 crores.

However, after some concerns were raised by former J&K governor Satyapal Malik, the matter was reviewed by the state Anti-Corruption Bureau and Finance Department. The issues examined included the eligibility criteria being changed in the middle of the tendering process, the non-transparent selection of the insurance broker, and the number of employees being artificially inflated to benefit Reliance.

According to the ACB report dated November 27, 2021, no anomalies were detected during the verification process, and only a reimbursement of Rs. 44 crores was suggested from Reliance for the surplus premium due to the contract’s termination.

In a report dated February 10, 2022, the Finance Department highlighted irregularities in the contract awarded to Reliance General Insurance. The report claimed that there were significant deviations from government norms, including the absence of an online tender, and the removal of a condition that vendors should have experience working in the state and have a turnover of at least Rs. 5,000 crore, and other violations.

Furthermore, the report identified issues with the e-tendering process, changes to the tender criteria after receiving only one response, modifications to the agreement with Trinity after it was signed, and the release of the first premium instalment before the agreement was finalized with Reliance. These findings contradict the ACB report’s conclusion that no irregularities were found and may suggest that Reliance’s contract was awarded unfairly.

Following the CBI’s summons, Malik informed them that he will be in Rajasthan at the time and provided his availability to meet with officers. It remains to be seen how this questioning will impact the trajectory of the case.