Judgment:
A.K. Basheer, J.
1. These two writ petitions are being disposed of through this common judgment, since the issues involved in them are closely inter-related.
2. Petitioners in these two writ petitions are two Trade Unions representing the employees working in the Kerala Minerals and Metals Limited, a company owned by the Government of Kerala. While the petitioner-Union in Writ Petition No. 11502/09 seeks 'an investigation by the Central Bureau of Investigation into the allegations of corruption and irregularities in the awarding of consultancy contracts and other transactions of the Company', the rival Union which is the petitioner in Writ Petition No. 18783/09 prays for 'issue of writ in the nature of mandamus or such other appropriate writ or direction to the State Government to proceed with the expansion work of the Company which has been kept in abeyance or cancelled.'
3. The Company which is admittedly owned by the Government of Kerala is engaged in production of Titanium Dioxide Pigment. The Titanium Dioxide plant was commissioned in February 1985 using the process technology imported from Kerr McGee, an American Company. The materials available on record indicate that the plant was commissioned with the help of Metallurgical and Engineering Consultants India Ltd., (MECON), India's front line multi engineering, consultancy and project management services owned by the Government of India.
4. It appears that a major expansion programme for the company was initiated in the year 1999 and a detailed project report was prepared. The Board of Directors of the Company and the Government gave approval for implementation of the project. The total estimated cost for the project was Rs. 782.41 crores, out of which Rs. 495.29 crores had to be raised as term loan and the balance as equity. One item of the expansion programme, namely installation of a packing machine, was completed in the year 2003. It is alleged by the petitioner in Writ Petition No. 18783/09 that the then Government led by the Left Democratic Front (LDF) did not take any further action for implementation of the project till 2001 though the expansion programme was initiated at its instance in the year 1999. Subsequently, when the United Democratic Front (UDF) came to power it was decided to implement the project as approved by its predecessor (LDF) without any major changes and within the limits of the estimated cost. Ext.P1 order dated April 23, 2004 was issued by the then Government in this regard. Pursuant to the above decision, the Government appointed M/S MECON as the engineering consultant for the 'expansion project'. According to the petitioner, the work on the expansion project progressed well. A sum of Rs. 41.65 crores was spent on desalination Plant in order to tackle water scarcity which was a major problem faced by the Company in the manufacturing process. Orders were placed for purchase of plant and machinery for Mineral Separation Plant (MSP) and a new Synthetic Rutile Plant (SRP). A 200 TP and Oxygen Plant on B.O.O.(Build, Own, Operate) basis was also ordered to ensure supply of Oxygen at less than Rs. 8/M3. We do not propose to refer to the various other items of work which were allegedly carried out under the expansion project at this stage. Similarly, we also do not deem it necessary to deal with the question of viability of the project or the advantage that the company would have obtained, if the project had been completed.
5. The grievance of the petitioner in W.P. No. 18783/2009 is that shortly after the Left Democratic Front (LDF) came to power in the year 2006, the Government directed the Board of Directors to stop all expansion activities. Later, the Government issued Ext.P3 order on January 25, 2008 cancelling the expansion project on the ground of paucity of funds and techno-economic non-feasibility. The 'remote chance' to get financial support from financial institutions was also cited as a reason. It is in the above circumstance that petitioner has filed Writ Petition No. 18783/2009 praying for issue of a direction to the Government to proceed with the expansion work of the company.
6. But the case of the other trade union i.e., petitioner in Writ Petition No. 11502/09 is that the large scale corruption and maladministration in the Company warrants investigation by an agency from outside Kerala, like the Central Bureau of Investigation. It is contended that M/S MECON Ltd. was appointed as consultant for implementation of the expansion project by the earlier Government because of extraneous considerations. It is alleged by the petitioner that the time schedule prescribed in the agreement executed between the company and the consultant was totally ignored. Payments were made to the company without insisting for bank guarantee and in violation of a specific clause in the agreement in this regard. M/S MECON was paid an amount of Rs. 18,17,60,587/- between 2004 and 2006. The company executed a power of attorney in favour of M/S MECON Ltd. giving full authority and discretion to invite tenders, select the tenderers, settle the claims etc. The consultant had procured materials and services to the tune of Rs. 55.76 crores on the strength of the above power of attorney, all of which had to be abandoned at the initial stage itself. It is further alleged by the petitioner that the total project cost had escalated from Rs. 760 crores to Rs. 1115 crores compelling the present Government to have a second thought before proceeding with the project. Petitioner alleges that higher officials in the company, who wield substantial control over the affairs of the company had conspired with M/S MECON Ltd. and siphoned off the funds of the company. Petitioner-Union claims that it is seriously interested in the welfare of the company.
7. It is pointed out by this Union that the Kerala Lok Ayukta had issued an order on May 2, 2006 on a complaint filed by it directing the Director of Vigilance and Anti Corruption Bureau to conduct an enquiry into the allegations made by the petitioner in that complaint. Enquiry was directed to be completed within a period of three months.
8. However, on a motion made by the Director of Vigilance, time for completing the investigation was enlarged by the Lok Ayukta by six months from August 2006. In August 2007, the investigating officer sought for further enlargement of time by four months. The officer informed the Lok Ayukta that the enquiry was in progress. In September 2007, yet another report was filed by the investigating officer informing the Lok Ayukta that the Vigilance enquiry was in its final stage and that the report would be filed within six weeks.
9. When the case was taken up before the Lok Ayukta on March 27, 2008, the Legal Adviser representing the Vigilance and Anti Corruption Bureau produced the order of the Government (SRO 210/08) before the Lok Ayukta giving consent to the members of the Delhi Special Police Establishment to conduct 'investigation into the alleged irregularities and corruption in awarding the contract for the expansion project'. Therefore, the Lok Ayukta closed the complaint, recording the submission made by the Legal Adviser. Ext.P10 is the copy of the order passed by the Lok Ayukta. A copy of the order issued by the Government is also available on record as Ext.P11.
10. However, by communication dated July 17, 2008, Ministry of Personnel, PG & Pensions, Government of India, informed the Government of Kerala that the request for CBI investigation was not found to be feasible since no inter-state or international ramifications that might support the proposal for investigation by the CBI had been brought out. It was also pointed out by the Union Government that Vigilance department was already in session of the matter. The copy of the said communication issued by the Government of India declining the request for CBI investigation is on record as Ext.P12.
11. Though the Government of Kerala made yet another request to the Central Government to hand over the investigation to the CBI as could be seen from Ext.P13 letter from the Additional Chief Secretary addressed to the Central Government, there was no response.
12. It is in the above circumstance, Writ Petition No. 11502/09 has been filed praying for issue of an appropriate direction to the Central Bureau of Investigation to take up the investigation.
13. In the statement filed on behalf of the Central Bureau of Investigation, it is stated that the Central Government had held consultation with the Central Bureau of Investigation in the light of the Order issued by the Government of Kerala (SRO 210/08) - Ext.P11. After an elaborate consideration of the entire matter, the Central Bureau of Investigation took the view that this is not a fit case for CBI investigation. It is seen noticed by the CBI that State Government had decided to abandon some of their Projects and the State Vigilance Department had conducted investigation of the case. It is further stated that after receipt of Ext.P13 request from the State Government further consultations were held and the request was reconsidered. Thereafter, it was again decided that the Central Bureau of Investigation would not be in a position to take up the investigation of the case. It is also pointed out that the Vigilance and Anti-Corruption Bureau, which had registered this case, has necessary jurisdiction to investigate the case anywhere in India. Prima facie, there is nothing to indicate that the case has any inter-State or international ramification, eventhough M/S MECON Ltd. is based at Ranchi in Jharkhand. The CBI has not conducted any investigation in the matter. But on a discrete verification, it has been revealed that this is not a fit case for CBI investigation.
14. We have carefully perused the allegations and counter allegations made by the two Unions. Whatever be the merit of the contentions raised by the respective Unions in the two writ petitions, it may at once be noticed that Vigilance and Anti-corruption Bureau, which was entrusted with the investigation by the Kerala Lok Ayukta by its order dated May 2, 2006 (Ext.P4), had taken up the investigation and made considerable progress in completing the same. In his last report by the officer in charge of the investigation filed before the Lok Ayukta on September 17, 2007, it was stated that the 'enquiry was in progress and in the final stage'. The officer informed the Lok Ayukta that the enquiry would be completed within six weeks. On December 7, 2007, when the case was again taken up before the Lok Ayukta there was no representation on behalf of the Director of Vigilance.
15. Shortly thereafter, on January 24, 2008, the investigating officer filed a report before the Lok Ayukta informing that the enquiry was in progress and that about 55 records had been collected and 10 witnesses were questioned. The officer informed the Lok Ayukta that the enquiry would be completed without any further delay.
16. Immediately thereafter Government of Kerala came out with Ext.P11 notification dated February 18, 2008 (SRO 210/08) purportedly invoking its powers under Section 6 of the Delhi Special Police Establishment Act 1946 according sanction to the members of the Delhi Special Police Establishment to exercise powers for conducting investigation into the alleged irregularities and corruption in awarding contract in the company.
17. Thus, it is evident from the developments that emerged during the pendency of the enquiry by the Vigilance and Anti-corruption Bureau that there was no impediment in the investigation. In fact various reports filed by the investigating officer before the Lok Ayukta to which reference has already been made by us earlier, will clearly show that the Vigilance enquiry had progressed quite well and it was almost complete by January, 2008.
18. More importantly petitioner in Writ Petition No. 11502/09 has not made any allegation against the Vigilance and Anti Corruption Bureau, either about its incompetence or flaws in the process of investigation held by it. There is also no allegation of any bias, favoritism etc. There is not even a whisper against the investigating agency (Vigilance and Anti-corruption Bureau) that it had not conducted the enquiry/investigation in a proper and satisfactory manner. More importantly, petitioner does not have a case that the Vigilance and Anti Corruption Bureau was in any way disabled or frustrated in questioning any witnesses outside Kerala.
19. As rightly pointed out by the Central Bureau of Investigation, there is no prima facie material to indicate that the case has got any inter-state or international ramification warranting an investigation by the Central Bureau of Investigation. A bare perusal of the various allegations made by the petitioner against some of the officials and M/S MECON Ltd., are basically pertaining to alleged misuse of funds. We do not propose to deal with that aspect of the matter any further, since necessarily the Government may have to take a decision on the further course of action to be adopted in the case. Further, the Vigilance and Anti-Corruption Bureau had admittedly carried out extensive enquiry in the matter after collecting documentary evidence and questioning witnesses. In that view of the matter, especially, in the absence of any specific allegation of incompetence of the Vigilance and Anti-corruption Bureau to conduct enquiry in the case, we have no hesitation to hold that the prayer made by the petitioner in Writ Petition No. 11502 of 2009 to hand over the investigation to the Central Bureau of Investigation is totally unsustainable and therefore it is liable to be rejected. We do so.
20. As regards the prayer in Writ petition No. 18783/09 also, we are not inclined to issue any specific direction as prayed for. The materials placed before us in this case will undoubtedly show that there was some lethargy or inaction in getting the expansion project implemented. We do not propose to embark upon an enquiry as to who was responsible for the delay. But obviously the company is the loser which in turn will affect the public as well, since public funds are to be utilised by the Government for the expansion project. The Government has to necessarily bestow its best possible attention and try to salvage the situation. The materials available on record will indicate that this company is only one of the three such entities in India which manufacture Synthetic Rutile. (Of course, the other two are in private sector). So if only the Government takes a positive and proactive approach in the matter, the company can be saved. The industrial sector in this State needs such a proactive support from the Government. While doing so, all other considerations must be ignored and the larger interest of the State must be kept in view. If public funds have been swindled by anybody, the guilty must be brought to book and punished.
In the result, the two writ petitions are disposed of in the above terms.