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1) SNC Lavalin Scandal 1) SNC Lavalin scandal The SNC Lavalin scandal is financial scam related to the contracting of the government with a Canadian company, SNC-Lavalin which resulted in an alleged net loss to the exchequer of 374.50 crore in the renovation and modernization works of the hydro electric power stations at Pallivasal (37.5 mw), Sengulam (48 mw) and Panniar (30 mw) - also known as PSP project in short - installed in between 1940 and 1964 at Idukki district in Kerala state of India. Several politicians were involved and eventually charged, including former ministers G. Karthikeyan of Indian National Congress, Vijayan. The first Politburo member in the CPI (M) history to be prosecuted in a corruption case. History In 1992, the Central Electricity Authority (CEA) of India rejected a proposal of Kerala State Electricity Board (KSEB) to renovate the three hydro-electric power projects at Pallivasal, Sengulam and Panniar instead the CEA recommended a capacity upgradation of the generators in these three power projects, after they found that these projects are in good condition. KSEB disregarded this recommendation and went forward with the decision to renovate these projects. The initial negotiations with the Canadian company SNC-Lavalin - a company which had been present in the state's power sector for several decades - began during the tenure of United Democratic Front government, [7] under the leadership of the then power minister C.V. Padmarajan and later, the Kerala State Electricity Board (KSEB) signed a memorandum of understanding (MoU) with SNC-Lavalin on 10 August 1995, when G. Karthikeyan of the Congress Party was the power minister, after the resignation of C.V. Padmarajan. Under the provisions of the MoU, the funds for the renovation were to be arranged by SNC Lavalin from the Export Development Canada (EDC), Canada, and the Canadian International Development Agency (CIDA). Later, it was also found out in a probe by CBI, that G. Karthikeyan also wanted a quid-pro-quo assistance from the Canadian government for the setting up a hospital for granting a project for refurbishment of Pallivasal, Shengulam and Panniyar Hydro electric stations in Kerala, after the revelation of a letter by G Karthikeyan to the then vice-president of Lavalin business operations, Klaus Triendl, who is also an accused in the Lavalin scandal.[4] It was only in the September 1995, that the KSEB undertook a feasibility study on the proposal, by a retired Chief Engineer of the KSEB, who later became a consultant to SNC-Lavalin. Based on the consultant's report and further discussions, the KSEB under the leadership of G. Karthikeyan, signed the contracts with SNC-Lavalin to provide technical services for management, engineering, procurement and construction supervision on 24 February 1996, to ensure completion of the projects within three years. The consultancy agreement did actually include the rates for various equipments to be purchased as part of the project. Consultancy agreements were converted into fixed price contracts for the supply of machinery and technical services as part of the renovation at a cost of 67.94 million Canadian dollars (Rs 169.03 crores). The final follow-up agreement with SNC-Lavalin regarding the renovation of PSP project was signed by Pinarayi Vijayan of Left Democratic Front - after they took office winning the majority in legislative assembly in 1996 - in February 1997. Technically, the Left Democratic Front (Kerala) led government could not retreat from the agreements, even if they wanted to, according to the provisions of the MoU which was already signed by their predecessors, that is the ministers of United Democratic Front government. After the final contract was signed, the KSEB entrusted the National Hydroelectric Power Corporation Limited (NHEPCL) a study to justify the prices quoted by Lavalin, and they concluded in that study that in view of the grant to the proposed Malabar Cancer Centre (MCC), the purchase of Canadian equipment and accessories could be considered favorably.[3] The CAG found that Lavalin was only a consultant intermediary and not the original equipment manufacturer and that the supply of goods and services was made by other firms at a much higher cost leading to excess expenditure. According to the CAG, the absence of due professional care in negotiating the foreign loan proved to be detrimental to the financial interests of the Board. The Board also could not ensure the quality of renovation work in the absence of technology transfer and training of its engineers. Owing to various technical defects in the equipment, the generation of power could not be maintained even at the pre-renovation level and the Board had to spend on repairs. According to the CAG, failure to exclude the fee for technical consultancy from fixed price contracts resulted in an avoidable payment of Rs 20.31 crores, and failure to negotiate and exclude the exposure fee from the loan agreement resulted in avoidable payment of Rs 9.48 crores and future liability of Rs 2.21 crores. In the opinion of the CAG, there was also an avoidable payment of Rs 1.20 crores as commitment fee despite there being committed but unavailed advance. The CAG found that the Government did not receive Rs 89.32 crores out of the grant of Rs 98.30 crores that was promised for the Malabar Cancer Centre as the MoU was not renewed in time during the tenure of United Democratic Front when Kadavoor Sivadasan was the minister in charge of power. On 16 January 2007, Kerala High Court ordered a CBI enquiry into the scandal. On February 18, 2008, the CBI informed High court of Kerala that the investigation was progressing and said that former Electricity MinistersPinarayi Vijayan and G. Karthikeyan would be examined at the appropriate time. On 21 January 2009, the CBI filed a progress report on the investigation in the Kerala High Court. Pinarayi Vijayan had been named as the 9th accused in the case. On 2 February 2009, the CBI wrote a letter to the Governor of Kerala, seeking sanction for the prosecution of Pinarayi Vijayan under section 197 of the CrPC, who later referred it to the cabinet. On 6 May 2009, the Cabinet opined that it was not necessary to grant permission to prosecute Pinarayi Vijayan. On 31 August 2011, the Supreme Court of India issued notices to Government of Kerala and the CBI, on a petition filed by Pinarayi Vjayan, challenging the then Kerala Governor, R.S. Gavai's nod to prosecute the former, over-riding the decision of the council of ministers, after he wrongly assumed that he had jurisdiction and power to grant sanction on his own. The proceedings against Pinarayi Vijayan initiated in the special court were stayed by this order. -----------********************------------------*************------------- 2) Jeep scandal case From Wikipedia, the free encyclopedia The jeep scandal in 1948 was first major corruption case in independent India. V.K. Krishna Menon, the then Indian high commissioner to Britain, ignored protocols and signed an Rs 80 lakh contract for the purchase of army jeeps with a foreign firm. Corruption allegations V. K. Krishna Menon, then the Indian high commissioner to Britain, bypassed protocol to sign a deal worth Rs 80 lakh with a foreign firm for the purchase of army jeeps. Even then the jeeps were unusable, but Nehru forced the government to accept them. Govind Ballabh Pantthe then Home Minister and the then Government of Indian National Congress announced on September 30, 1955 that the Jeep scandal case was closed for judicial inquiry ignoring suggestion by the Inquiry Committee led by Ananthsayanam Ayyangar. He declared that "as far as Government was concerned it has made up its mind to close the matter. If the opposition was not satisfied they can make it an election issue". Soon after on February 3, 1956 Krishna Menon was inducted into the Nehru cabinet as minister without portfolio. ------------****************------------- 3) Taj corridor case The Taj Heritage Corridor case is an alleged scam wherein 2002–2003, the then Chief Minister of Uttar Pradesh Mayawati and a minister in her government, Nasimuddin Siddiqui, were charged with corruption. The Taj Corridor project was intended to upgrade tourist facilities near the Taj Mahal and was to be implemented during her tenure as Chief Minister. The then BJP government at the Centre gave the Environmental Clearance required for the project near Taj Mahal. However, later on the BJP backed out and then started saying that the project was not cleared by the Environment Ministry and blamed Mayawati for starting construction work near the Taj Mahal. Cost and funding The total estimated cost of the project was Rs. 175 crore (US$ 44 million). Political support The project was started with the support of the BJP and interrupted when Mayawati Bahujan Samaj Party disaligned itself with that party on 25 August 2003. Commentators said that this change in alignment was due to Mayawati's quickly-changing temperament and because of the BJP's hostility toward the Taj Heritage Corridor project. A political commentator said that the support for the Corridor project came when Mayawati protected BJP leaders L.K. Advani, Murli Manohar Joshi and Uma Bharti from prosecution in the case of the demolition of the Babri Masjid by moving the trial of all charges except the conspiracy charge to a court in Rae Bareilly. Investigation of scam It has been alleged that Mayawati embezzled the money dedicated for this project. The case is currently under investigation by the Central Bureau of Investigation. Initially, the case saw some rapid progress, when CBI conducted extensive searches on her various addresses, and claimed that though she had claimed income of only Rs. 1.1 crores during her tenure as CM, her bank balance in a single bank went up to 2.5 crore and total assets held by her were estimated at Rs.15 crore.
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