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The Dynastic Gymkhana Club- DGC- and its current brush with the law

By IndianMandarins- 25 Jun 2020


When the Modi government swept to power for the second time in 2019, it appeared that the party’s declared objective of ending “Parivarvaad” (dynastic entitlement) would finally be achieved. The call to end undeserved entitlement amongst the parasitic political and social ‘elites’ of ‘Lootyen’s Delhi’ resonated with many, but the political tsunami managed to clear out only one side of the Safdarjung Road. The other deeper entrenched bastion of hereditary privileges continues to thrive across the pavement, just beyond PM’s official residence.  This 26-acre plot of land was leased at a pittance by the British to the British officials who in 1913 set up a watering hole and sports facility for the forlorn Brits serving their time in India.  It has since survived in its Indian avatar as Delhi Gymkhana club. 

The Club is self-governed by its annually elected General Committee, and chaired by a President.  Over the years, its General Committees, controlled by different vested interest groups in the Club, have violated many rules of governance, and manipulated the basic structure of its guiding documents (Memorandum and Articles of Association) particularly those affecting membership, effectively turning it into a dynastic club.

As a registered not for profit company under section 8 of the Company Law the Club requires prior approval of the Government for any change to its AoA.  The correct path would have hindered the advancement of personal interest, so the Government was seen at best as a nuisance that needs to be managed.  The unwritten code of silence and mutuality of interest kept prevented internal matters from spilling out in the public, giving the successive General Committees a free hand to practically violate every rule.

Four years ago, the Ministry of Corporate Affairs decided to open an enquiry into the affairs of the Club, as it was no longer possible to ignore the mounting number of complaints and court cases against the Club. After a detailed enquiry, a petition was filed in April 2020 at the NCLT by the MCA seeking to take over the management of the Club, due to repeated violations. 

This put many members in a panic mode. The Club has used all its sympathisers to put out favourable stories extolling the heritage of the Club, externalizing the problems and blaming the Government’s ‘high handed’ manner, and its meddling in what is seen as a ‘family matter’.  Prominent Lutyen’s denizens have publicly bemoaned this ‘attack’ on a legacy left behind by the departing British rulers. The lack of any introspection or determination to set the house in order on part of the management has left the old-timers bewildered.  Instead of any effort to correct the mistakes of the past, the Club administration has continued to demonize the ‘disgruntled whistleblowers’, and has created a war chest of around Rs 1.5 crores to contest the Government right up to the Supreme Court.  In an institution where personal and family interest reign supreme, the MCA’s conclusion that the Club is beyond self-correction is not too off the mark.

Family first:

Egregious violations that fast track children of members with vested interests is commonplace. As a result, fresh applications from the public were arbitrarily stopped. This closes the Club’s doors on outsiders. The waiting period for a civil applicant has increased to over 35 years since a large part of the slots were arbitrarily earmarked for the progeny of the members in order to fast track their entry.

It is no surprise that the families that control the Club resent government enquiry as they fear that this may unravel their control and put seriously at risk the privileges of hundreds of dependents and their children who were admitted to the club, with a few cases on the sly.  They enjoy all the facilities of the Club, including a claim to hereditary membership, though without voting rights till their status is regularized.

While revelling in the long history and tradition of the Club, most seem to flaunt membership as a proof of having ‘arrived’ in the charmed circle of Delhi elites. In hushed tones, members gossip about marriages of convenience with spouse membership used as a bait or ‘dowry’, production of fake certificate of eligibility or even impersonation as government servants, and false declarations about service status.  Dependants who have long left India for foreign abode, and have acquired foreign citizenship -- with or without an OCI status -- also do not give up this coveted membership and pay much lower local membership fees. After all who would not like to keep the seat warm for their third and fourth generation?  NRIs pay through their nose, but then they were unfortunate to not have their parents as members.

Above the law::

Even when facing serious charges in the NCLT, subsidized food, drink and accelerated membership for their ward remains the focus for most members. They love the prestigious address, and their management has achieved financial wizardry by milking unsuspecting individuals in the waitlist to pay hugely enhanced registration and entrance charges which went to maintain the lifestyle of the members. Only when the MCA pointed it out, these amounts are being refunded.

A deep sense of entitlement and impunity pervades this organization since they count the high and mighty of the land, including senior ministers, generals and secretaries to the government of India as members. These women and men of stature lend not only respectability to the club, but also unknowingly provide the Club a shield against the probing eyes of successive Governments and its agencies.  Lesser bureaucracy always remains in awe of the impressive list of members and does not dare to ask uncomfortable questions.  Many from municipal agencies were also co-opted via a secretively run ‘cash card’ system that allowed them access to all facilities of the club.  This created the naïve idea that the Club is above the law.

Failures of the family and internal dissent:

Unfortunately, The Seniors and the old school ‘elites’ of the club took a hands-off approach that allowed some individuals to run the affairs of the club. In these “committee meetings,” anyone who raised a dissenting voice was vilified, hounded and charge-sheeted.  The administration had unfettered access to the Club funds to defend their arbitrary decisions if challenged legally.  The conscientious was immediately dubbed as ‘traitors’ to the cause and the tightly controlled WhatsApp groups run by vested interests ran them down for committing the treason of airing their views in public. The silent majority lost its voice and eventually interest, staying away as they did from the murky deeds of a few, and special interest groups that took over the reins.  The current state of affairs, and the current predicament of the Club, can thus be attributed to a larger, structural problem.

The Enquiry and the modus operandi:   After four years of detailed and meticulous investigation the Registrar of Companies, at the instructions of the Ministry of Corporate Affairs, has filed a petition in the National Companies Law Tribunal (NCLT) in April 2020 seeking specific reliefs. MCA order reveals that the Government has decided to move the NCLT for repeated and egregious violation of all laws, charge the current General Committee under the stringent provision of the law, appoint Administrators to set things right and also look at the alternative uses of the expensive land so that it serves a public purpose in a wider sense.

Aware of the tampering in membership by successive administrations, MCA enquiry has done a deep dive in this aspect. Their finding reveals that while 50% of the 5600 strong membership was to be kept reserved for the higher civil service and defence forces, the actual user base has swollen to over 15000, with a majority consisting of offspring of members and their progeny.   To accommodate the growing number of such dependants 50% of slots meant for new civilian applicants had been arbitrarily carved out and reserved for the ‘family’ resulting in a waiting period of over 35 years for any new applicant, and effectively denying them and their children any hope of ever availing of the club facilities in any meaningful manner.  On the other hand, children of members have been allowed full access to the club even after having crossed the age of dependency through creative interpretation of the law, and their induction fast-tracked by creating a separate waitlist in violation of the Club rules.  Even more, children of individuals who are in line to become permanent members have been permitted use of the club in blatant violation of the Articles. This insidiously changed the very complexion of the Club, turning it into a hereditary fiefdom that it has become now.

Despite being aware of the interminable waiting period, the Club continued to lure fresh innocent applicants who were asked to shell out hefty sums of money just to enjoy the privilege of standing in a barely moving queue. To add insult to injury, when the Club was short of funds, this hapless group were tapped into for more funds just to keep their place in the waitlist. The options were stark – pay up or lose the waitlist position. It is widely suspected that such arbitrary and periodic decisions helped the management to tinker with the waitlist, by moving up those who paid up early. Whispers of money having changed hands for such favours have never been seriously looked into. Periodically similar special windows are created for short durations to accommodate their favourites or bring inwards of the Committee members who may otherwise have been ineligible.  When done in short bursts without much prior notice information only flows to those who are on the inside track in the club or are connected to the committee members.  One such special window of regularizing those children who have missed the bus when they turned 21 was opened in June/July 2019, just in the closing days of the outgoing committee to benefit some of the members who were then serving on the board.   These shenanigans and much more have been captured in great detail in the painstaking enquiry conducted by the Ministry of Corporate Affairs since 2016. 

The Whistle-blowers and the Gravy Train:   2017-2018 became a watershed moment for the Club as for the first time some senior members of the club, having failed to obtain any reply or satisfaction from the Club authorities went to the SFIO seeking redress. The same year a majority of the GC, consisting of former government and defence officers with proven professional track records, ‘revolted’ against the President.  They raised questions within the committee against the perpetuation of past wrongs, and arbitrariness of the entire decision-making process including taking no action on three enquiry reports ordered by the same Committee. Each report has since been junked or set aside despite spending lakhs of club money on these. This group of nine (out of a total of 16+1) were forced to hold an emergency meeting of the GC to distance themselves from some patently wrong decisions including the passing of the annual accounts without an adequate majority. The dissents were never recorded or acknowledged despite the fact that the new Company Law enforces collective and individual responsibility on the Board members.  Even after this meeting, faced with complete non-cooperation from the then President in registering the minutes, they had to take recourse to have the minutes registered with the MCA.  This was brought to the attention of the entire membership but even this failed to wake them from their slumber.   Self-appointed leaders of different vested groups were uncomfortable at the refusal of this group to brush violations under the carpet and go with the flow.

As expected the wrath of these family-oriented groups turned on those who rocked their boat. It was deemed that ‘The Traitors’ needed to be punished. The retribution was swift and severe.   Several senior officials including two former Secretaries to Government of India were issued a notice for suspension and eventual termination of membership. This started yet another expensive legal battle in which the club throws member’s money to defend the untenable decisions of the GC and President. The members have to fend for themselves and bear their own legal expenses to protect their rights.

Other Doubtful actions and attitudes:  The lack of governance has made the Club a republic within a nation, and some of the following few instances will highlight how they scorn at every norm of the nation:

a)    When the nation is increasingly moving towards digital payments, this club allows its members to pay large sums of money in cash. Till recently it was Rs. 30,000 a month in two instalments as if fighting black money and putting an end to cash transactions is not their concern.

b)   Large scale use of cash cards for selected government agencies who are there to enforce the laws amounting to institutional bribery.

c)    Violation of all financial norms by contracts being awarded to members or their relatives.

d)   Undermining the authority of the General Committee by the Secretary in collusion with the President.

e)    Falsification/ vague recording of Board minutes to justify even past illegal decisions at times with retrospective effect.

f)     Violation of building norms, construction without any permission or concern for the PM’s security and illegal storage of material behind false ceilings which led to collapse only recently.

g)    Last year when PM had to visit the Club for a wedding some conceited members were vociferously objecting to additional security protocol since it inconvenienced their set patterns. This only reflects the deeply ingrained attitudes of entitlement.

h)   The flawed election process and how it has been hijacked by a few coteries (more details provided)

The Way Forward:  It is clear to the insiders that the Club is so much under the spell of the ‘thekedaars’ that internal reforms will never happen for the simple reason that many of the children will lose their rights, and contracts and appointments including of compromised and complicit officials will need to be set aside.

Even fresh election will not change matters as the “Family Group” preselects candidates and recommends only those that sign up to their demand of not tinkering with the existing membership system, and indeed commits to push their agenda by methods fair or foul.  This vitiated atmosphere has kept most well-meaning and dignified members away from the filth of internal elections.

Election process:  In fact, in 2018 elections 13 to the 16 members of the Committee, mainly civil and defence officials individually decided not to contest for a second term despite several being eligible for re-election.  2019 election was unique as not enough members showed interest in becoming a part of the Committee, creating a situation that the Club had to request members to fill in forms so as to have a full committee of 16 plus the President constituted.  As a result, anyone who filed his/her nomination needed just one vote to be elected unopposed.   The law of the land has been cleverly used to manipulate the election process itself by exploiting the loopholes in the imperfect system of online voting that was introduced in 2017. The very first election was marred by controversy as the outgoing Club management wished to favour the chosen ones who they relied up on to not expose their wrongdoings. It has been alleged that the super seniors and seniors, who form a majority of the membership, were cajoled by their offspring and other family members to cast proxy votes for them. So voting took place ‘en bloc’ and multiple votes were cast from the same computer making a mockery of the one member one vote principle besides other glaring deviations from established practices and procedures. Despite demands, the details of the voting patterns and identification of IP addresses used for possible ballot stuffing was not made public. By 2019, the members had become wiser and insisted on major changes in the process of authentication of the actual voter. This alone broke the stranglehold of the Family Group and created an upset- it is learnt that their chosen candidate for President could not win.  While online voting on resolutions is definitely a convenience, but there is a need to look at whether it should be made mandatory for a section 8 company, a social club. In the past, the Club used to obtain an exemption from this requirement which was always granted by the Government. But times are changing, and it helps to selectively implement government laws when it serves the larger purpose of those who wish to control the Club.

Role of Government officials under the spotlight:   In fact, while the MCA’s attempts to set right the functioning of the Club, Government needs to separately look into the role of serving officials who as part of the Club’s Governing Committee did not seem to display any strength of character or conviction. Their suitability for any senior position in the Government itself comes under a cloud, and the government needs to ascertain is such craven behaviour is symptomatic of a larger issue of low ethical and moral standards. A few who served in key administrative committees were the most active proponents of punishing the senior whistleblowers, and remain active today directly or through their proxies on different platforms in the Club.  There could be no better 360-degree assessment of such officials than evaluating their conduct in the club affairs.

Finally, no member would like the Club to be shut down, or the current President to suffer due to the acts of his predecessors. But one cannot ignore the reality that several of his committee members are holdovers from the past, with the sole objective of thwarting any reform by him. This became crystal clear when the new incumbent, a retired General, took over as the new President in Sept 2019. He was influenced to change the composition of the key sub-committees- membership, discipline and finance -  three times in this first ten days to accommodate the nominees of vested interest groups in these key areas of responsibility. The majority in these subcommittees shifted in favour of past officeholders and the General was checkmated. However well-meaning the President was his hands were tied just as he entered the battlefield, thus ensuring that he failed. The club needs an Administrator who has the stature and standing to take tough decisions that can set right the past violations.  Some unsuspecting and well-meaning members and scribes have gone to the extent of accusing the Government of ulterior motives ignoring the sad reality of a moribund Club. They fail to realize that an outsider may actually be a blessing in disguise- as that alone may save the Club they are so fond of for its history, heritage and cuisine. The Club needs to shed a lot of deadwood and reinvent itself, besides becoming compliant with all the laws if it has to survive another Century as an iconic institution. Many believe that the MCA has only scratched the surface in some areas of management and a more detailed enquiry in other matters will throw up many more skeletons.

(The writer is a member who loves the Gymkhana Club very much, but loves the Truth more)

(The views and opinions expressed in this article are those of the author and do not represent the views of the editorial management of, New Media Network)

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