Odious Debts

Kerala government decides to blacklist SNC-Lavalin company

After 14 long years, the state government has made its first move to blacklist the SNC-Lavalin company by issuing show-cause notices to it.

By Rohit Raj for the Deccan Chronicle

Kochi: The [Kerala] government issued as many as three notices to the company “in compliance with the decision of the government to blacklist SNC Lavalin and their associates”.

The company had a happy existence for 14 years even after the Comptroller and Auditor-General of India announced  in 2000 that it had caused a loss of Rs 274 crore to the state exchequer.

Though Opposition Leader V.S. Achuthanandan had repeatedly sought to blacklist the company, the UDF government moved in that direction only in January 2014 when it filed an affidavit  before Kerala High Court that the state had decided to take steps to blacklist it. Later, the government issued three notices.

According to sources, the company has decided to move the High Court challenging the show-cause notices and the decision to blacklist it.

As per the documents with Deccan Chronicle, the government  sent a show-cause on June 10, 2014, a  letter  on December 10, 2014 and another show-cause on September 28,  2015.

The notices made it clear that the proposed blacklisting was to be in operation for any contracts in future and in perpetuity.

The  communication dated December 10, 2014 from the Kerala State Electricity Board to SNC-Lavalin company fixed a date for personal hearing which states that “in compliance with the decision of the government to blacklist SNC-Lavalin and their associates, it has been decided to afford an opportunity of personal hearing to the company”.

The show-cause notice issued by the KSEB on June 10, 2014 states that the government had decided to blacklist the company.

Therefore, the KSEB was under instructions to take immediate steps for the compliance of the said decision.

The notice specifically made references to the controversial Malabar Cancer Centre project for an action of blacklisting.

The show-cause notice also pointed to the Memorandum of Understanding (MoU) signed by the company for establishment of the MCC.

Interestingly, the  CBI had submitted before the CBI Special Court , Thiruvananthapuram,  that the proposal to set up a cancer hospital at Thalassery in Kannur district in return for awarding the Canadian firm a fixed price rate contract to modernise three hydroelectric projects in the state at an ‘exorbitant’ cost of Rs 374 crore was the ‘brainchild of CPM leader Pinarayi Vijayan.

Mr Pinarayi was later discharged from the case by the trial court and the revision petition challenging the acquittal is pending before the High Court now.

Indian High Court orders top investigation agency probe of SNC Lavalin case

India’s Comptroller and Auditor General finds major lapses in government electricity deal with Canadian firm, SNC Lavalin

CAG uncovers serious deviations in Canadian power contract

CAG report finds major lapses in deal with SNC Lavalin

KSEB-Lavalin deal draws CAG’s criticism

 

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