It was a peaceful May afternoon in 1971 when a phone rang at the State Bank of India’s Parliament Street branch in New Delhi. The caller identified himself as Prime Minister Indira Gandhi. Calmly, he instructed the cashier to withdraw Rs 60 lakh in cash and hand it over to a courier. No questions were asked. Within hours, the money was gone—marking the beginning of one of India’s most bizarre and enduring financial scandals. The man who received the cash was Rustom Sohrab Nagarwala, a former army officer. He was arrested that very night and confessed during questioning that he had impersonated the Prime Minister. But the confession only deepened the mystery. How could one man deceive India’s largest public sector bank into handing over such a massive amount? Why didn’t the cashier, Ved Prakash Malhotra, verify the caller’s identity? And how was Nagarwala able to mimic Indira Gandhi’s voice so convincingly? The government fast-tracked the trial. Within 20 days, Nagarwala was convicted and sentenced to four years in prison. But before an appeal could be filed—or a thorough investigation could begin—he died under mysterious circumstances in custody less than a year later. The official cause was a heart attack, but speculation of foul play has never fully died down. In recent years, the case has resurfaced in The Scam That Shook a Nation (HarperCollins, 2024), a book by veteran journalist Rasheed Kidwai and retired civil servant Prakash Patra. Drawing from newly declassified documents, the authors suggest that the ₹60 lakh could have been part of a covert intelligence fund tied to the Bangladesh Liberation War. Some argue Nagarwala was a scapegoat; others believe he was a fixer with access to powerful circles. The core mystery remains unresolved. Was it an elaborate con or a covert operation gone wrong? The silence of key witnesses and the government’s refusal to reopen the case only fuel lingering doubts. Five Unsolved Questions That Still Haunt the Case: How did Nagarwala perfectly replicate the Prime Minister’s voice? Why didn’t the cashier follow standard bank verification procedures? What was the true origin and final destination of the Rs 60 lakh? Was Nagarwala acting alone, or protecting someone else? Why was the case closed so swiftly without a full investigation? Why It Still Matters The Nagarwala case wasn’t just a fraud—it exposed how easily power can bypass protocol. It blurred the line between political influence and institutional responsibility. In today’s world of digital banking, cyber frauds, and phishing scams, the case serves as a chilling reminder: even without forged documents or hacked systems, authority alone can be weaponized. As the case crosses the 50-year mark, one question remains unanswered: was India’s first major political-bank scandal ever truly solved? This piece is based on historical records, including The Scam That Shook a Nation by Prakash Patra and Rasheed Kidwai (HarperCollins, 2024).The article is authored by Hariom, an intern from University of Hyderabad
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