Kerala HC stays govt order barring PwC from State projects

KC Gopakumar Kochi | Updated on December 04, 2020 Published on December 04, 2020

The Kerala High Court on Friday stayed for one week the State government order barring Pricewaterhouse Coopers from participating in government projects for two years and deciding not to extend a contract relating to the Kerala Fibre Optics Networks (KFON) project.

Justice PV Asha passed the stay order on a writ petition filed by Rakesh Kaul Panjabi, a partner of the PwC challenging the government order.

Gold smuggling issue

The petitioner pointed out that the Kerala government had decided to bar/blacklist the petitioner company on the ground that as a consultant to the PMU Space Park of the Kerala State Information Technology Infrastructure Limited, it had not performed a comprehensive background check on an individual, Swapna Suresh.

There were allegations that it was PwC which had cleared the appointment of Swapna Suresh, an accused in the gold smuggling case, as an Operations Manager of the Space Park, based allegedly on the recommendation of the Chief Minister’s former principal secretary M Sivasankar (Also allegedly involved in the smuggling case). The investigation also found that Swapna’s graduation certificate was bogus.

‘Arbitrary order’

The petitioner contended that the government had not followed the principle of natural justice before issuing the order. It had arbitrarily proceeded to bar or blacklist the petitioner company without hearing it. In fact, it was after receiving the curriculum vitae of Swapna Suresh from the Managing Director of KSITL that the petitioner had got the background verification checked by a third party, Vision Technology and Staffing Solutions Pvt Limited. The company later received a letter from the Vision Technology that the candidate’s background verification was found to be “clear”. “It was after that the candidate was deputed to the Space Park Project “as a third party resource on the payroll of Vision Technology”.

The petitioner argued that the order had been passed in a mechanical manner and without any application of mind. The petitioner had made large investments in equipping itself to perform the works of the KSITIL’s project. The government order would render these investments redundant and lose its complete market stand in the state.

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Published on December 04, 2020
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