THE JUDGES INQUIRY COMMITTEE (‘JIC’) has indicted former Delhi High Court judge (originally from the Allahabad High Court) Justice Yashwant Varma in connection with the alleged recovery of unaccounted cash by the Delhi Fire Service personnel on March 14, 2025 from an outhouse at his official residence during a firefighting operation.
The JIC, composed of the Supreme Court judge Justice Aravind Kumar, the then Bombay High Court Chief Justice Shree Chandrashekhar, and senior advocate B.V. Acharya, has found Justice Varma guilty on all three counts, namely: that substantial unexplained ₹500 Indian currency notes were found in the storeroom; that the evidentiary condition of the storeroom was disturbed before the lawful sealing and inspection, and that the later non-availability of the currency notes remains unexplained. The JIC further noted that Justice Varma’s reply remains evasive and unsatisfactory and lacked candour and transparency.
The JIC report was tabled in the Lok Sabha today. The JIC was formed under the Judges (Inquiry) Act, 1968 to investigate allegations of corruption against Justice Varma, who was later sent to the Allahabad High Court from the Delhi High Court purportedly as a disciplinary measure.
While the JIC was holding the inquiry, Justice Varma chose to resign on April 10 this year.
The JIC has found Justice Varma guilty on all three counts, namely: that substantial unexplained ₹500 Indian currency notes were found in the storeroom; that the evidentiary condition of the storeroom was disturbed before the lawful sealing and inspection, and that the later non-availability of the currency notes remains unexplained.
What the JIC found on all charges
The first charge against Justice Varma alleged that, on or about the intervening night of March 14-15, 2025, substantial undeclared Indian currency notes were found in the storeroom within the secured residential premises under the occupation and control of Justice Varma; that he failed to disclose or explain the lawful source or ownership of such currency notes; and that such possession and non-disclosure, being within the official premises under his charge, control, knowledge and accountability, was inconsistent with the standards of probity, integrity and rectitude expected of a judge of the higher judiciary.
On this charge, the JIC found:
Several official witnesses from the Delhi Fire Services and Delhi Police, who reached the premises in the discharge of official duty, spoke about the presence of burnt, half-burnt, wet or scattered ₹500 denomination currency notes inside the storeroom. Their evidence is not solitary; it is mutually corroborative.
It is also supported, in material particulars, by the electronic and photographic record identified during the inquiry.
It is not possible to determine the exact amount of currency found inside the storeroom because the currency notes were not seized. However, the absence of exact quantification does not dilute the core finding that the currency notes present in the storeroom were huge and substantial. The evidence is not of a few stray notes or isolated remnants. It is of bundles, heaps and stacks of ₹500 denomination Indian currency notes seen in burnt, half-burnt, wet and scattered condition within the storeroom.
The oral evidence, read with the videos and photographs, establishes that the quantity of burnt and semi-burnt currency notes was substantial, conspicuous and far beyond a stray or negligible presence.
On the failure to seize the currency notes, the JIC opined that it was not done under certain apprehensions and under the impression that an official complaint would be made, as the scene of occurrence was within the official bungalow of a sitting judge.
With regard to the defence set up by Justice Varma that the storeroom was detached from the main living area, was near the staff/security quarters, was used for storage of old household articles, and was accessible to staff, CPWD personnel and others, the JIC found it to be untenable. The JIC found that the storeroom was not outside the official compound of the judge. It was not under the independent occupation of a stranger. It was under Justice Varma’s control and possession.
The JIC also observed that the plea of shared access does not answer the charge. Access by servants, security personnel, gardeners, maintenance staff or CPWD personnel for limited purposes may bear upon the question whether the judge had exclusive physical custody of the storeroom. It does not, JIC said, convert a storeroom within the official residence of a Judge into an unregulated public space. Nor does it explain how substantial currency notes came to be present therein.
The JIC noted that Justice Varma did not participate in the inquiry and did not depose on oath. Hence, an adverse inference was to be drawn against him.
The JIC noted that Justice Varma, in his statement, stated that a liquor cabinet was kept in the storeroom and that the said liquor cabinet used to remain locked.
“This circumstance is not noticed for the nature of the article stored, but for what it indicates about the character of the room and the Judge’s own use of it. A locked cabinet containing personal articles is not ordinarily maintained in a space which is wholly unregulated, wholly outside the knowledge of the occupant, or wholly beyond his effective control,” the JIC held.
The JIC clarified that it does not infer from the circumstance that the currency notes belonged to Justice Varma nor does it treat the existence of a locked liquor cabinet as proof of possession of currency notes. Its relevance, the JIC observed, is narrower but significant.
According to JIC, it indicates that the room was not outside the judge’s knowledge, use or effective control. If the room was sufficiently connected with the judge’s establishment to keep a locked personal cabinet, the plea that the judge had no effective control over the room cannot be accepted in the broad manner in which it is advanced.
On the failure to explain the lawful source or ownership of the currency notes, Justice Varma asserted that he was never aware of any money or cash lying in the outhouse storeroom; that neither he nor any member of his family had knowledge of the cash; that no such cash or currency notes had been shown to his family members or staff; that the question of explaining the source did not arise; and that he rejected any insinuation of removal of currency notes from the storeroom.
The JIC noted that Justice Varma did not participate in the inquiry and did not depose on oath. Hence, an adverse inference was to be drawn against him.
In any event, the JIC recorded that the judge was undoubtedly entitled to say that the currency notes did not belong to him and that he had no knowledge of them.
“But where substantial currency notes are found within official premises under his institutional charge, the explanation expected is not exhausted by a bare denial”, JIC observed. “The explanation must reasonably engage with the presence of the currency notes, their possible source, the persons who had access, the circumstances in which they could have been placed, and the steps taken to ascertain the truth after the fact came to light”, it added.
The JIC rejected the conspiracy theory. It held that no person has been identified. No occasion of entry has been established. No material has been produced to show how such substantial currency notes could have been brought into the premises without detection.
The second charge against Justice Varma was failure to preserve and causing interference with material evidence. After the fire was doused, and before lawful inspection and sealing by competent authorities, burnt currency notes and surroundings at the scene were altered or removed while the premises were under the control of the judge; and that the failure to ensure that material evidence was secured or preserved, and acquiescence in its disturbance or removal, amounted to dereliction of institutional duty and obstruction of due process.
In his defence, Justice Varma said he was not present in Delhi on the day of the fire. The JIC accepted that the judge was not physically present when the fire broke out and when the first responders reached the premises. It also accepts that fire and police officials, once present, were expected to perform their own duties in accordance with law. Their failure to seize, inventory or preserve the currency notes was a serious lapse.
It, however, found that Justice Varma was aware of the whole incident and was in touch with his daughter, household staff Mohd. Rahil and Private Secretary Rajinder Singh Karki.
The JIC relied upon the evidence of witness C.G. Rawat, who said that after the fire had been extinguished, he saw household staff and Rajinder Singh Karki present near the store; that when he asked if he could offer help, Rahil told him to go and do his duty at the gate; that after his duty, while returning to his barrack, he again passed the storeroom and saw Karki and Mohd. Rahil (household staff) still engaged in cleaning work; and that in the morning burnt household articles had been kept outside and the cleaning work was finished. The JIC drew the inference that they did it at the instance of the judge.
The third charge against Justice Varma was that when called upon to explain the circumstances surrounding the discovery of a huge amount of cash and the incident, he, by an evasive explanation, denied the same; that such denial stands contradicted by the evidence of independent officials and photographic/video records; and that he thereby failed to exhibit the candour, transparency and sense of responsibility incumbent upon a constitutional functionary.
While the JIC was holding the inquiry, Justice Varma chose to resign on April 10 this year.
The JIC noted from the letter dated March 22, 2025 by Justice Varma that he did not merely deny ownership or personal knowledge. He stated that he was never aware of any money or cash lying in the outhouse storeroom; that neither he nor any member of his family had knowledge of the cash; that no such cash or currency notes were shown to his family members or staff; that after the fire was doused no cash or currency notes were seen by members of the household or staff; that the question of explaining the source did not arise; and that neither he nor his staff had removed any article, currency notes or cash in any form. Thus, the earliest answer was a broad denial of knowledge, placement, presence after dousing, source and removal.
The JIC noted that later, in his reply dated April 30, 2025, Justice Varma challenged the absence of seizure, panchnama, inventory and quantification, and treated the subsequent cleaning activity as routine cleaning of a fire-ravaged site, contending that such activity could not be equated with removal of burnt or half-burnt currency notes.
“In the writ petition filed by him, the presence of cash came to be treated on a different footing, the emphasis being on the alleged failure of the authorities to seize, preserve or lawfully document the material. The writ petition, filed on oath, treated the presence of cash as non-contentious while attacking proof of ownership, quantity, genuineness, placement and removal. This progression is material. The earliest reply was not merely ‘I do not know’. It also asserted that no cash was seen by family or staff after the fire and that no staff member had removed any article, currency notes or cash. Later, the defence shifted to non-seizure, absence of quantification, electronic deficiencies, first responder handling, conspiracy, planting, and possible staff involvement. Such expansion of defence may be permissible as a matter of legal strategy, but it cannot substitute a candid factual explanation,” the JIC observed.
The JIC found that the explanation furnished by Justice Varma was evasive, incomplete and misleading in effect. It was evasive because it did not engage with the central circumstance of substantial currency notes seen by independent officials inside the storeroom. It was incomplete because it did not disclose the factual steps allegedly taken by him, the details of inquiries made, the answers received from staff or household members, or any action taken to preserve the site or complain of foul play. It was misleading in effect because the earliest broad denial gave way to successive alternative hypotheses, none of which was substantiated when the opportunity to lead defence evidence was available.
Earlier, an in-house committee formed by the then Chief Justice of India, Sanjiv Khanna, concluded that “cash was found in the storeroom of 30 Tughlak Crescent, New Delhi, officially occupied by Justice Yashwant Varma” and that “access to the storeroom (where the cash was kept) was under the covert or active control of Justice Varma and his family members.”
In its recommendation, the In-House Committee concluded:
“Based on the direct and electronic evidence on record, this Committee is firmly of the view that there is sufficient substance in the allegations raised in the letter of the Hon’ble Chief Justice of India dated 22 March 2025. The misconduct found proved is serious enough to warrant the initiation of proceedings for the removal of Justice Yashwant Varma, Judge of the Allahabad High Court.”
A petition filed by Justice Varma challenging the in-house report was dismissed by the Supreme Court.
Justice Varma was divested of judicial work, while receiving his full salary from the Consolidated Fund of India, for nearly a year. In April this year, he chose to resign and at the same time withdrew from the JIC proceedings midway.