Court clears Pinarayi Vijayan in Lavalin case

Print edition : September 15, 2017

“We all know that there are many people who have been waiting for this day. They are of two kinds. Those who saw it in a positive way, not just those who gave me a favourable verdict in the election, but along with them a large section who had realised the truth much earlier. But certain mysterious forces were all the time pursuing the case, with the intention of a good hunt. We have to understand that this verdict creates a big disappointment to such forces.” It was with these concluding words and the distribution of sweets that Chief Minister Pinarayi Vijayan announced his liberation from the scourge of “the SNC-Lavalin corruption case” that had been haunting him for nearly two decades.

“The CPI(M) central committee had made it clear early enough that it is a case foisted with political motives. The speciality of today’s verdict is that the High Court too brings that out with clarity,” he said.

On August 23, the Kerala High Court rejected the revision petition filed by the CBI against a Special CBI Court’s order passed in November 2013 discharging Vijayan and two others in the case. The two others were the then Principal Secretary, K. Mohanachandran, and the then Joint Secretary, A. Francis, officials in the Electricity Department when Vijayan was the Electricity Minister from May 1996 to October 1998. The High Court, however, rejected the decision of the CBI court to set free three officials of the Kerala State Electricity Board (KSEB)—former chief accounts officer K.G. Rajasekharan Nair, former chairman R. Sivadasan and former chief engineer Kasturiranga Iyer—along with Vijayan and others.

The long-drawn-out case related to the award of a supply contract to the Canadian company SNC-Lavalin for the renovation and modernisation of the Pallivasal, Sengulam and Panniar hydroelectric projects, for which the company had already been engaged by the KSEB as a consultant.The crux of the High Court’s judgment is in the distinction it made between Pinarayi Vijayan and the two others discharged along with him as “persons outside the KSEB, brought in or arraigned by the CBI on the allegation of a conspiracy later on”, and the rest of the accused as “persons within the KSEB who designed the projects and perpetrated the contracts”. The High Court pointed out that Vijayan and the two government officials had no involvement or role in the modernisation projects designed by the KSEB. It was also not the CBI’s case that the three had made any unlawful gain or monetary benefit out of the deal between the KSEB and SNC-Lavalin.

The circumstances of the rest of the accused were entirely different, the court said. “They are the persons who designed the projects for the renovation and modernisation of the hydroelectric projects; they are the persons who perpetrated the contracts which happened to be executed in suspicious circumstances, and they are the persons who allegedly caused monetary gain and pecuniary advantage to SNC-Lavalin.”

In his 102-page verdict, Justice P. Ubaid said the main allegation against Vijayan appears to be that he showed undue haste and interest in the execution of the supply contracts in February 1997, and the KSEB happened to execute such a contract at the instance of the Minister in haste “when the SNC-Lavalin offered some grant for the construction of the Malabar Cancer Centre”.

But the CBI does not have any satisfactory explanation as to what vicious role or dishonest role the Electricity Minister had in the deal when he got the things approved by the Cabinet or when the Cabinet as a whole approved the proposal of the KSEB.

The court said: “I find that despite materials showing failure and inaction on the part of many Ministers who succeeded him, the CBI wrongly picked and chose the seventh accused (Vijayan) for prosecution on an allegation of conspiracy, without the support of any material. Just because SNC-Lavalin retracted from the gratuitous promise which was not at all accepted as one of the essential conditions of the contract between SNC-Lavalin and KSEB, the Minister who obtained such a promise and who later omitted to obtain an enforceable contract, cannot be prosecuted because there cannot be such a contract on gratuitous terms. If at all such a contract is there, it cannot, in any circumstances, be legally enforced.”

The court said that though there were three written supply contracts, nowhere was it mentioned that the proposal for a cancer hospital or the grant offered by SNC-Lavalin for it was one of the essential terms of the contract. There is also no reason why the CBI would find fault with Vijayan alone and allege that he failed to obtain an enforceable agreement from SNC-Lavalin, even though he was the Electricity Minister only for a short period and “had no sufficient tenure to expedite things and get an enforceable contract from SNC-Lavalin”.

The court also said that just because the proposal for a grant for the hospital was taken up and accepted by the government in view of the special interest shown by the then Electricity Minister, it cannot be said that it was part of the other contract, or that it was thought of and accepted as a consideration for the other contracts. It was projected, proposed and accepted simply as a gratuitous grant. And if the KSEB officials wrongly extended some benefit to SNC-Lavalin, in view of such an offer made by the company, the KSEB officials must be liable for it, the court said.

The latest High Court order, too, may prove to be a only the “end of another stage” in a long battle, if the CBI decides to go in appeal against it in the Supreme Court.

R. Krishnakumar