How the ₹950-Crore Fodder Scam Shook Bihar: Vijay Shankar Dubey and the Fall of Lalu Prasad Yadav

Key Points:

The multi-crore fodder scam, one of India’s most notorious corruption scandals, involved the embezzlement of nearly ₹950 crore from Bihar’s Animal Husbandry Department (AHD). Money meant for cattle fodder, medicines, and livestock upkeep was drained from public funds through fake bills, forged documents, and non-existent suppliers. In some cases, even scooters and mopeds were listed as vehicles used to transport cows and buffaloes.

The scam had reportedly been running quietly since the 1970s, but it exploded into public view in the mid-1990s. This scam shook the foundations of Bihar’s political establishment and ultimately led to the resignation and conviction of then Chief Minister Lalu Prasad Yadav.

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Vijay Shankar Dubey

Vijay Shankar Dubey, a 1966-batch senior IAS officer, is remembered as one of Bihar’s most upright and disciplined bureaucrats. He remains the only IAS officer to have served as Chief Secretary of both Bihar and Jharkhand. Known for his strictness and honesty, Dubey’s tenure as Principal Secretary of the Finance Department in 1995 marked a turning point in the state’s political and financial history.

In an interview with Navbharat Times editor Alok Kumar, Dubey explained how the fodder scam, worth hundreds of crores, came to light and how the then Chief Minister Lalu Prasad Yadav was eventually forced to resign.

When Dubey took charge as Finance Secretary in July 1995, Bihar’s financial health was in deep crisis. Salaries were delayed, funds were unaccounted for, and the treasury was almost bankrupt. While reviewing state expenditure, Dubey found that the Animal Husbandry Department had spent nearly five times its allotted budget — a red flag that pointed to something far bigger.

He ordered a detailed audit of three years of expenditure, and soon after, the Comptroller and Auditor General (CAG) raised similar concerns. An Additional Secretary sent by Dubey to Ranchi discovered that many of the bills used for fund withdrawals were completely fake — not mere clerical mistakes, but deliberate forgeries.

Funds meant for animal feed and medicines had been diverted through ghost suppliers and falsified paperwork. Dubey directed the officer to seize all the bills and return to Patna. On January 22, 1996, after reviewing the seized documents, he prepared a detailed report for the state government, exposing the large-scale embezzlement and recommending that an FIR be filed.

Initially, the Bihar government under Lalu Prasad Yadav tried to suppress the matter. But Dubey’s directives had already set the bureaucratic machinery in motion. On January 27, 1996, he instructed the District Magistrate of Chaibasa, Amit Khare, to raid the local treasury. The raid confirmed Dubey’s worst fears — extensive financial irregularities, fake supplier records, fabricated veterinary invoices, and unauthorized withdrawals.

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From Bureaucratic Action to CBI Investigation

Following the Chaibasa raid, similar raids followed in Ranchi, Dumka, and other districts, revealing that the scam had spread across the state. At that stage, the estimated loss was over ₹300 crore, which later ballooned to nearly ₹950 crore — all siphoned off over years through forged bills and fake documents.

Despite bureaucratic resistance and political interference, Dubey’s persistence ensured that the truth reached higher authorities. Mounting public pressure forced the Bihar government to recommend a Central Bureau of Investigation (CBI) probe.

In March 1996, after a Public Interest Litigation was filed in the Patna High Court, the court ordered the CBI to investigate. The agency registered 66 cases, naming around 170 accused, including senior politicians, bureaucrats, and suppliers.

On June 23, 1997, the CBI formally charged Chief Minister Lalu Prasad Yadav, prompting his resignation. Before surrendering to a CBI court, he appointed his wife, Rabri Devi, as his successor and the new Chief Minister of Bihar. Lalu was later convicted for the first time in 2013 in connection with the fodder scam and was subsequently disqualified from contesting elections.

The first FIR related to the excess withdrawals from the Chaibasa district (now in Jharkhand) was lodged on March 27, 1996. Altogether, 66 cases were filed, and 170 people — including politicians and top bureaucrats — were charged. The exposure of the scam marked a defining moment in Bihar’s political history.

Nearly three decades later, the fodder scam has once again entered Bihar’s political discourse. Ahead of the upcoming Assembly elections, Deputy Chief Minister and BJP leader Samrat Choudhary, who also holds the finance portfolio, announced on March 28, 2025, that the state government plans to recover the illegally withdrawn amount from the accused. [Rh]

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