Registered with the Registrar of Newspapers for India under R.N.I 53640/91

Vol. XXVIII No. 21, February 16-28, 2019

On the fake rupee trail

by F.V. Arul, IP

Some famous crimes recorded in various Tamil Nadu police journals.

Towards the end of 1959, a few cases of counterfeit hundred rupee currency notes were reported in Coimbatore. The counterfeit notes came to notice in the Pulliampatti Shandy, near Coimbatore. The District Police were unable to make any headway, so the Crime Branch CID, Madras, was ordered to take up the investigations.

R.N. Krishnaswamy, Deputy Superintendent of Police, Crime Branch, CID, commenced the investigation in April 1960. He found the case files relating to 1959 and 1960 revealing that the counterfeit hundred rupee note had been issued on 16 different occasions in Coimbatore district and that business transactions in that district were considerably impeded, as hundred rupee notes were not being accepted as legal tender for fear that they might be counterfeit. It was also clear from a scrutiny of the notes that had been seized that a single agency was responsible for their manufacture. They were seized under series H19 and A20, under the signature of B. Rama Rau, Governor of the RBI.

To start with, only one lead was available. The 11 notes which had been circulated in the Pulliampatti Shandy belonged to Varadaraja Chetty, a Municipal Councillor of Ootacamund. During interrogation Chetty stated that he had been a victim of a currency doubling trick in December 1958, in which he had lost Rs. 50,000 to P.C. George of Gandhipuram in Coimbatore. After the loss, Chetty continued to pester George to return the money or to obtain for him a consignment of counterfeit notes in lieu thereof. Finally, in March 1960, George and another came to him at Coonoor and handed over 150 counterfeit hundred-rupee notes of A20 series. It was out of this consignment that Varadaraja Chetty issued 32 counterfeit notes at Pulliampatti Shandy towards the purchase of a large number of bags of chillies. Having heard that 11 of those notes had been detected, he burnt the remaining counterfeit notes. He, however, did not know the agency that actually printed the counterfeit notes.

The investigating officer found that Geroge was a shady character, frequently indulging in doubling currency tricks and who was also in touch with some of the lower ranks of the police force in Coimbatore. It was decided not to arrest George at this stage but to maintain an unobtrusive watch over his movements with a view to track the agency that manufactured the notes. In May 1960, the investigating officer made an attempt to purchase counterfeit notes with the help of an informant. It was ascertained that the counterfeiters were not prepared to negotiate the sale of the notes unless they first tested the solvency of the buyer. The investigating officer posed as a rich man, registered in a top-class hotel and had with him a bundle of genuine hundred-rupee currency notes to the value of Rs. 25,000/-. The trap failed at the last moment. It was obvious that information had leaked somehow.

Some time later, the investigating officer rented a house and posed as a rich film producer and in that capacity, set a trap for the counterfeiters. He again failed. A careful check of the arrangements made for the trap on both occasions showed that the only person who could have passed on the information to the other side was Sub-Inspector Padmanabhan of Coimbatore, who had volunteered to help the investigating officer. He was, therefore, sent back and the investigating officer made further attempts to trap the counterfeiters. He finally located one Narayanaswamy Asari, who offered to procure counterfeit hundred rupee notes. In the course of the negotiations, Narayanaswamy Asari stated he had been commissioned in 1958 by G. Krishnan, a textile mill magnate of Coimbatore, to prepare a block for printing counterfeit notes. The block had been actually prepared in the guesthouse of Krishnan and was later destroyed as it did not come up to standard.

The investigating officer decided to act and arrested Narayanaswamy Asari as well as George and Balasundaram, who was a confidante of Krishnan. The three made statements detailing the existence of a conspiracy headed by textile mill magnate G. Krishnan and assisted by Sub-Insptector Padmanabhan. George further stated that he had received a consignment of counterfeit notes from one Mani who was also in the conspiracy. It was from this consignment that he had given counterfeit notes to Varadaraja Chetty of Ootacamund.

In June 1960, Krishnan and Padmanabhan were arrested in Coimbatore. A search of the latter’s quarters resulted in the seizure of counterfeit hundred rupee currency notes to the value of Rs. 6.7 lakh. These notes were of the H19, A20, Q12 and Q16 series bearing the signature of B. Rama Rau and had been hidden in the kitchen. Further investigation showed that the other conspirators were K.S.B. Mani, K.R. Antony, M.C. Kuriakose, K.A. Hameed, Thambu, Periasamy, Marudachala Gounder, Balakrishna Muralidhar and K. Sridharan Nair. All of them were duly arrested.

Further investigation revealed the following picture:

In 1957, G. Krishnan, the owner of C.S. & W. Textile Mills Limited, purchased a number of other textile mills in rapid succession, paying an advance in each case. Unable to raise the remaining amount, he was tempted to get over the financial difficulty by printing counterfeit currency notes. He sent his confidante Balasundaram to Kerala to get into touch with known counterfeiters.The latter took the assistance of Mani. They failed in their mission in Kerala and later pitched on Narayanaswami Asari whose work was of poor quality and, therefore, destroyed. In the early part of 1958, Mani contacted K.R. Antony of Kottayam, who was known to be a counterfeiter and was the proprietor of a photo studio. The latter agreed to manufacture hundred rupee notes provided he was handsomely paid. Mani was a good friend of Sub-Inspector Padmanabhan who arranged for a meeting with Krishnan for some consideration. The Sub-Inspector joined the conspiracy.

Thereafter, Antony and his assistants Kuriakose and Hameed came to Coimbatore and commenced manufacturing the blocks in the guest house of Krishnan.

In the meanwhile, Krishnan ordered the East Asiatic Company Limited, Madras, to supply a German Heidelberg printing machine while Mani and Padmanabhan rented a house in Coimbatore on a monthly rent of Rs. 100. The German printing machine was duly delivered at Coimbatore and the invoice was sent to the Pullicar Textile Mills Limited, which was owned by Krishnan. The printing machine was set up in the rented house by a mechanic sent by the East Asiatic Company Limited and the erection certificate was signed by Mani, who was not an employee of Pullicar Textile Mills Limited. An Indian cutting machine purchased by Antony in Madras and paid for by Krishnan was also installed in the rented house. Soon after this, Mani proceeded to Bombay on the instruction of Krishnan and purchased 208 reams of 17th Reserve bond paper and despatched it to Coimbatore. There was documentary evidence to prove the purchase and movement of the paper from Bombay to the rented house in Coimbatore.

The printing then started but it was found that the paper purchased in Bombay was not quite suitable. It was, therefore, sold in the local market and a fresh stock of SKAGERACK paper was purchased in Coimbatore. This paper was cut to the size of hundred rupee currency notes after eliminating the watermark portion of the paper. During this period, Padmanabhan supervised the work and kept Krishnan informed of the progress. At about this time, the Sub-Inspector went on casual leave for 10 days without informing the other conspirators. The latter took fright thinking that the Sub-Inspector would let them down and so shifted the machinery to the guesthouse of Pullicar Textile Mill Limited in Salem District, which also belonged to Krishnan. The Sub-Inspector returned from leave and was able to convince Krishnan and the others that he had not betrayed them. He was, therefore, once again admitted into the conspiracy.

The printing at Pullicar Mills was found unsatisfactory and some of the mill workers were also making enquiries about the strangers they had seen in the guesthouse. It was, therefore, decided by the conspirators to shift the printing machine to Coimbatore again. This was done and this time, the machinery was installed in the guesthouse of Janardhana Textile Mills Limited, which also belonged to Krishnan.

Since Antony found the German printing machine difficult to operate, he asked for a replacement. Krishnan arranged for the purchase of a Russian T.C. Heavy Platen machine from Madras. Antony and Hameed then proceeded to Bombay to purchase Indian-made Sunlight Offset paper for Rs. 1,718 and transported it to Janardhana Textile Mills Limited. When Antony visited Bombay, he booked personal trunk calls to Krishnan, which were duly traced by the investigating officer.

Having secured a new printing machine and fresh paper, the printing of counterfeit notes started in right earnest. Printing was completed between March and May 1959. The nominal value of the counterfeit notes printed was Rs. 15 lakhs. The printing in March 1959 was actually inaugurated by Krishnan at an auspicious time by turning on the printing machine.

The bundle of notes were delivered to Krishnan by Antony and Sub-Inspector Padmanabhan on the morning of May 4, 1959 and Antony received a payment of Rs. 2.5 lakhs in genuine currency. This money had been withdrawn by cheque from the Punjab National Bank on the date by Krishnan. Thereafter, Antony and his assistants left for Kerala by car and were escorted by Sub-Inspector Padmanabhan.

Krishnan lost no time in issuing the counterfeit hundred rupee notes. The same evening, he paid Rs. 10,000 to Palani Gounder of Karmadai as payment for the supply of yarn. The next morning, he paid Rs. 60,000 to a number of cotton merchants to whom he owed money. One of them detected the forged notes and returned them to Krishnan through his clerk Ranganatha Rao. This upset Krishnan very much and he arranged to get back all the counterfeit notes that he had paid out. He then sent the entire lot of counterfeit currency notes to the house of Sub-Inspector Padmanabhan through Thambu and Periasami. Sometime later, Padmanabhan sold counterfeit notes worth Rs. 3 lakhs to Marudhachala Gounder of Thudialur. In January 1960, he sold Rs. 50,000 worth of counterfeit notes to George.

When the investigation started, Krishnan got alarmed and ordered the destruction of both the German and the Russian printing machines as also the Indian cutting machine. He sent the machines to a couple of engineering works in Coimbatore to be broken to pieces and melted. On the information given by the accused Thambu, broken unmelted parts of the printing machines were recovered from the firms and were identified by the mechanics of the companies that supplied them.

A strange incident took place at the height of the investigation. A registered parcel was received by the investigating officer and when opened, it was found to contain Rs. 1.19 lakhs of counterfeit notes of the same series together with an anonymous letter which stated that the sender had purchased the notes from Marudachala Gounder. The author of the letter could not be traced in spite of searching enquiries.

On completing the investigation, the evidence was placed before C.K. Daphtari, Solicitor General of India. The preliminary enquiry was taken up by the IX Presidency Magistrate Madras. He committed all the accused except Vadivelu Pillai to Sessions for trial. A Special Sessions Judge was appointed by the Government and the trial took no less than 80 days when exhibits were filed. The depositions recorded in the open court ran to more than 3,000 pages of typed matter.

The Special Judge delivered Judgement on July 27, 1960 convicting eight principal accused, including the textile mill magnate Krishnan and Sub-Inspector Padmanabhan, who received sentences of ten years’ rigorous imprisonment. On appeal in August 1962, the High Court of Judicature at Madras upheld the judgement of the Special Sessions Judge but reduced the sentences to seven years rigorous imprisonment.— (Courtesy: The Madras Police Journal).

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