The order noted that the prosecution succeeded in proving that both the accused hatched a criminal conspiracy with the common object of deriving undue pecuniary advantage, and by adopting corrupt or illegal means, and in pursuance of the said conspiracy and by misutilising clauses 31 and 32 of Local Competitive Bidding (LCB).

Clauses 31 and 32 of Local Competitive Bidding (LCB) deal with the purchaser’s right to vary quantities and the purchaser’s right to accept/reject bids, respectively.

Background

• The case centres on the Kulasekharapuram Irrigation Project in Kerala.
• An estimate for the project was originally prepared by the assistant engineer and was eventually sanctioned by the chief engineer for a total amount of Rs 23.15 lakh.
• On July 19, 1988, the superintending engineer, K K Philip, executed the original agreement with the lowest bidder contractor T O Abraham, who is accused no 2.
• The agreement included specific rates for items such as earthwork excavation, cement, concrete, and reinforcement for the flume canal.
• The prosecution’s case is that between July 1990 and February 1991, the accused hatched a criminal conspiracy to derive undue pecuniary advantage.
• The core of the case involves the misutilisation of clauses 31 and 32 of the LCB specifications.
• These clauses relate to the schedule of quantities and extra items, which the accused reportedly used to negotiate and award exorbitant rates for works that were either already covered under the original 1988 agreement or for which the contractor was ineligible for extra payment.

Findings

• It is interesting to note that the entire claim, in fact, was put up and finalised in the last week of February 1991.
• And thereafter, in February 1991, the engineer retired from service, and as pointed out by the prosecutor, in a hurry-burry manner.
• Apart from the Rs 23.15 lakh originally agreed and granted, an additional sum of Rs 34.78 lakh had been sanctioned by the first accused and obtained by the second accused, and both of them derived pecuniary advantage over the same.
• It is surprising to note that the senior counsel for the appellant raised a challenge regarding the sanction under Section 19 (previous sanction necessary for prosecution) of the Prevention of Corruption (PC) Act, 1988, in the case.
• While raising this contention, he failed to take note of the fact that the first accused retired in February 1991, and the investigation and cognisance for the PC Act offences against the first accused were taken after his retirement.
• Section 19(1) (prohibits courts from taking cognizance of offenses committed by public servants under sections 7, 11, 13, and 15 without prior sanction from the appropriate government or competent authority) of the PC Act does not provide for a sanction in the case of an employee who retired from service at the time of cognisance.
• It is judicially noticeable that the first accused also granted amounts to various contractors on the last date of his retirement in a similar fashion and caused a huge loss to the state exchequer.