The Other Side of the Coin

MANISH KHANNA DIGS himself into a large black suitcase, to emerge, minutes later, with a coin in one hand. You can tell it is special from the way it has been stored. Encased inside a transparent plastic box and placed like an ornament in a red velvet cushion, the cushion’s core has been cut out so a viewer can see both sides of its centre.

“Have a look,” Khanna says and tosses the box into my hands. “Do you see anything suspicious?”

To my untutored eye, it is impossible to tell. It is a 25 paisa silver coin, dated 1880, with an image of Queen Victoria depicted on one side. Moving the box between my fingers, I admit defeat.

“Now try this,” he says, and passing a magnifying lens that is built more like a paperweight this time, he directs my eye to the listed date. “Can you see it?”
There is a peculiar darkness around the figure, which I would have passed off as grime accumulated over the years, but it becomes most pronounced, as Khanna shows me, around the last digit ‘0’.

“It’s been tooled,” he says.

Someone has used some sort of incredibly fine tool to work upon the original date (probably ‘1886’, according to Khanna), to make it appear ‘1880’. British Indian coins issued in 1886, it turns out, are relatively common. But an 1880 coin, as Khanna explains, is rarer and quite valuable.

Khanna was sold this coin a few years ago for Rs 1.6 lakh. It even came certified as authentic by a grading company he requests not be named. He managed to recover the money from the dealer once he realised what he had been sold (he did not however return the coin), but this episode confirmed what he says he had long suspected. The rare coin market in India, he says, is filled with counterfeits and forgeries.

Many rare coins, he says, seen at auctions and exhibitions in India, and even those in large private collections, are fakes. And according to him, several people, from dealers and collectors to auctioneers, knowingly sell these counterfeit coins.

“In this hamam (Turkish bath) everyone is naked,” he says.

The rare coin market is expanding rapidly in India. Collecting them isn’t just a hobby of children or small-time collectors now. Several auction houses have come up in recent years, each one of them conducting around seven or more auctions annually. Then there are the countless number of sales that happen informally, either online or offline, between dealers and collectors individually. Todywalla Auctions, considered one of India’s largest auction houses that deals in rare coins and bank notes, sells at an average between Rs 40 lakh to Rs 60 lakh worth of goods at each exhibition (70 to 80 per cent of the total lot put up for sale). Sometimes, the total is far more. During one such auction in 2016, a single 400-year-old gold mohur bearing the image of the zodiac sign Scorpio commissioned by the Mughal Emperor Jahangir fetched Rs 1.55 crore from an anonymous collector. This coin is considered the most expensive ever sold in India. It commands such a value because it is one of the few surviving coins with a zodiac sign from Jahangir’s era. According to the folklore among numismatists, the next Mughal Emperor, Shah Jahan, ordered all coins with zodiac symbols to be melted because he found them to be against Islam’s aniconic tenets of not bearing the images of living beings.

“The growth in rare coins’ value [in India] was most steep between 2006 and 2012. During this period, the value of [rare] coins would double in the span of just about 3.5 years,” says Malcolm Todywalla of Todywalla Auctions. “It [the growth] has steadied now, but it is still growing year on year. And there is still a lot of potential for it to keep growing.”

Todywalla Auctions, the first such auction house to sell rare coins in India, was established by Malcolm’s father Farokh in 1989. Farokh, then a cashier with the Central Bank of India who collected rare coins as a hobby, became interested in establishing a business around it when he noticed the growing interest among Indians in collecting coins.

According to the Todywallas, the growth in this industry in the last few years and the jump in its valuations are connected with the growing interest and pride among Indians about past empires and history. Globally, as Malcolm points out, coins connected with US and Chinese histories tend to fetch some of the highest sums. “There’s still some way for our coins to match those valuations. But the growth is there, and it’s quite phenomenal,” Malcolm says.

Globally, rare coins are increasingly also being viewed as a form of alternative investment. According to The Economist, quoting data from a consultancy (Knight Frank), among tangible alternative asset classes, the returns on rare coins over 10 years to the end of 2016 were 195 per cent. In comparison, the returns were 139 per cent in art, 133 per cent for stamps, -31 per cent for furniture and 58 per cent for the S&P index (the stock market index measuring the stock performance of 500 large companies listed on US stock exchanges). ‘Coins are more portable than paintings or furniture, and boast a higher value-to-volume ratio,’ the article states. ‘Stamps may be lighter, but, come doomsday, cannot be melted down.’

In India too, according to the Todywallas, the growth in rare coin sales is being driven by investors. “They look at it as a form of investment,” Malcolm says. “But for many of them, gradually, they get bitten by the collecting bug, and they begin to collect particular eras or kingdoms.” According to him, if you are interested in making fast returns in a few years, there are fewer better alternatives than investing in rare coins. “It’s a great time to invest in Indian coins,” he says.

But underneath this veneer of rare coins and the promise of great returns is a crisis of reputation. The rare coin industry is largely unregulated. Prices, many collectors say, are arbitrarily fixed. The market is filled with unscrupulous dealers and auctioneers. And the technology to create counterfeits has so vastly improved, that it is getting incredibly difficult to tell them apart. “In the past, it [the fakes] used to be clumsy. But now you cannot tell a fake one from a genuine one,” Khanna says.

Earlier this year, Maharashtra’s archaeology department issued an advisory about counterfeits in the rare coin market. It pointed out that collectors need to be careful and that they had especially noticed a number of counterfeit Shivrai copper coins, which used to be minted in the 17th century during the reign of Maratha ruler Chhatrapati Shivaji, in the market.

“You’ve got all this hi-tech people [counterfeiters] scanning [high-resolution images] genuine coins, then using those images to create the perfect dye to bring out [near-similar] coins. Then they bury the coins in wet earth for months to artificially age them. Look, it is like this,” Khanna says while ruffling through the pages of a book showing how easily coins can now be minted in rudimentary workshops. “Whenever a new business takes off and a lot of money begins to come in, fakes will always emerge. And over time the technology [to create counterfeits] will catch up. But the problem in India is that there is no way, no rules, of weeding them out.”

ACCORDING TO KHANNA, government agencies aren’t particularly interested in solving this issue. Whenever he notices rare coins or bank notes in the market, those that are claimed to be ‘experimental’ or ‘sample’ designs, or those with some errors in them, he approaches the mints and the Reserve Bank of India to find out if these coins and bank notes are indeed genuine. Usually they do not respond. Another problem, he points out, is that while many other antique objects, such as paintings and stone or bronze structures, older than 100 years need to be registered with the Archaeological Survey of India (according to the Antiquities and Art Treasures Act,1972), coins are exempted. Another collector, Madhav Agarwal from Lucknow, points out that this is probably because coins are usually found in large quantities, making it impossible for the ASI to get each coin registered.

Most rare coins in the country are also not often graded for their authenticity. There are independent coin certifiers, like the Professional Coin Grading Service (PCGS) and the Numismatic Guaranty Corporation (NGC) in the US. But only a few coins are ever sent from India. “That’s because, by law, we aren’t allowed to send old coins outside the country [for fear of the smuggling of antiques],” explains Malcolm. A few years ago, a rare coin grading agency had been set up in India. But this agency, Numismatic Guarantee Service, was found to be unreliable. According to many collectors, some of the coins it graded as authentic were later found to be counterfeits. According to Malcolm, to get around this issue, auction houses such as theirs are now trying to persuade a reputed international coin grading agency to set up an office in India.

Khanna, who began collecting rare coins since 2007, has now stopped collecting them entirely. He has instead formed an online group, Vigilante Numismatics, a community of over 3,000 members, where people expose fraudulent dealers and verify whether a particular coin is genuine.

Seated today in his store, an electric hardware shop in the old Mumbai bazaar of Kalbadevi, amidst a flurry of cats (he adopts them before finding them new homes), he rifles through drawers and cabinets, using a right arm weighed down by amulets and bracelets. From various parts come small bags and plastic containers whose contents now tumble onto the table.

Tiny dull silver and copper coins, many broken and some whole, several of them from the valuable Indo-Greek series, lie strewn on the table. “Fake, fake, fake,” he calls out, as a large trembling finger moves from one to another. Some of these he was conned into buying.

But many of them he bought purposely, he says, to use them for evidence when he would approach courts for the need to regulate the industry.

Khanna is a reviled figure in numismatic circles. “Everybody hates me because of this. They would rather have me just shut up. But I can’t just shut up. It’s wrong,” he says. Apart from approaching government mints for their opinion on certain bank notes and coins, he also actively examines catalogues and exhibitions, questioning anything suspicious that he comes across, and roping in archaeological experts and scholars for their opinion on them.

One such incident occurred in 2016, when what came to be known as Sholay coins (the coins with two obverse sides or heads, used by Amitabh Bachchan’s character in the film Sholay), began to flood the rare coin market. “It started like it always does with a guy on Facebook showing off a photo saying he had managed to procure a Sholay coin,” says Agarwal. “In two to three months, the coin begins popping up everywhere. Soon every dealer in the country has about 20 of these coins. It even begins showing up at (rare coin) exhibitions.” According to the story put out, these coins had been produced because of an error at the mint in Kolkata. A single Sholay coin was then going for Rs 1.6 lakh.

A few people began to raise doubts. And Khanna, acting upon these suspicions, was able to get a response from the Kolkata mint saying it had never produced these coins. “Some medal and souvenir maker had managed to create a dye to make these coins in a factory… About three sacks filled with these coins were found there,” says Agarwal.

Agarwal, who used to run an online tutorial in Gurgaon, became interested in rare coins around eight years ago, when he returned to his house in Lucknow to find that his father had amassed a large collection of coins. Agarwal began to read more deeply on ancient Indian coins, specialising particularly in those belonging to the Mughal era, and cataloguing and adding to his father’s collection. He and his father began to plan and strategise on how to go about their collection, looking up patterns in the rare coin industry, at one point even creating an excel sheet of the rare coins that would appear at exhibitions or in dealers’ hands, so they could avoid those coins which appeared fairly frequently, selling even those which they possessed in their collection to buy instead the extremely rare.

Agarwal has over the years come across several counterfeits. There were some counterfeits even in his father’s collection. He mentions in particular the euphoria he witnessed early in his coin-collecting days when some labourers working at a trench in a remote Himachal Pradesh locality were believed to have hit upon a huge collection of coins belonging to the Kuninda kingdom. The Kuninda kingdom is believed to have existed in modern-day Uttarakhand and some parts of Himachal between the 2nd century BCE to the 3rd century. There were in total around 1,200 coins bearing the name of the Kuninda king Amoghabhuti, and each coin went from anywhere between Rs 3,500 to Rs 30,000 depending on its condition. “Even a respected numismatic journal fell for the story of how some labourers chanced upon it. The market just went crazy,” Agarwal says. Later, however the coins were found to be counterfeits.

Agarwal has always been cautious. But he too fell to a scam in 2008. This was when he had just begun collecting rare coins. A dealer approached him and his father with some Mughal coins that had recently been found in a village in Uttar Pradesh. This was the incredibly rare Jahangir coins with zodiac signs. The dealer was willing to sell all 50 of these coins for a paltry sum of Rs 60,000. This should have sounded alarm bells for the two. But the two bought the entire collection.

“We thought we had hit a jackpot,” he says. “But we were royally had.”

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