Kerala HC Dismisses Petition Challenging Lok Ayukta's Probe Into Allegations Of Embezzlement In Procurement Of PPE Kits By KMSCL, State Govt

The Kerala High Court on Thursday dismissed the petition challenging the proceedings initiated by the Lok Ayukta on a complaint alleging corruption in the purchase of PPE kits and other surgical equipment during the COVID-19 Pandemic.The Division Bench comprising Chief Justice S. Manikumar and Justice Shaji P. Chaly, while dismissing the petition, observed that"On a perusal of the complaint, we are of the clear opinion that the complainant/1st respondent herein has not challenged the manner in which contract was provided, by invoking Section 50 of the [Disaster Management] Act, 2005; the allegations made in the complainant is with respect to the alleged corruption or maladministration that has taken place in the purchase of materials by making exorbitant and huge amount to the products than the maximum retail price".FactsA complaint was filed before the Lok Ayukta by one Veena S. Nair alleging that large scale corruption and embezzlement had occurred in the procurement of PPE Kits and other Surgical equipment during the COVID-19 Pandemic period. It was alleged that the corrupt practice was carried out by the Kerala Medical Services Corporation Ltd. (KMSCL) with the knowledge, and collusion of its senior officers and health department. The complaint also made allegations against the then Health Minister K.K. Shailaja. It was alleged that the purchases were made by the KMSCL through its officials at an exorbitant price than the market price of the product period by taking advantage of the situation. It was also alleged that all purchases were made in violation of the provisions of the Store Purchase Manual. It was specifically pointed out that 10000 numbers of disposable PPE kits were bought at a higher price than the maximum retail price of Rs.3,000. It was further alleged that 100% advance payments were made to inexperienced and non-existing companies as well as proprietorships for procuring low quality medical equipment at exorbitant price.Lok Ayukta ProceedingsThe Lok Ayukta initiated preliminary enquiry in the matter and issued notice in the matter. It was earlier contended by the officers, against whom allegations were made, that the complaint was not maintainable.The main contention was that the entire complaint and the allegations therein are in relation to the actions carried out during Covid-19 Pandemic - a declared disaster under the Disaster Management Act, 2005, and consequently, the complaint ought not to have been entertained by the Kerala Lok Ayukta under the Lok Ayukta Act, 1999, but that it could have been addressed through the 2005 Act itself. The Lok Ayukta said investigation be commenced under Section 9(3) of the Kerala Lok Ayukta Act, 1999, without prejudice to the right of the respondents to raise their contentions, including the question of maintainability of the complaint during the course of investigation. The writ petitions were thus filed before the high court challenging the Lok Ayukta order.High Court RulingIt was asserted by the writ petitioners hat the Lok Ayukta had failed to find that this was a fit case to refuse investigation under Section (5) (c) of the Lok Ayukta Act, 1999. It was averred that effective remedies were available to the complainant under the 2005 Act, and that she was not entitled to invoke the jurisdiction of the Lok Ayukta for the same. The preliminary decision of the Lok Ayukta to proceed with the complaint under the provisions of Kerala Lok Ayukta Act, 1999 is ultra vires the Disaster Management Act, 2005, which is a central legislation, it was submitted. It was argued that the investigation conducted by the Lok Ayukta would go against the overriding effect of Section 78 of Act, 2005. The writ petitioners further pointed out that purchases had been made by the KMSCL during the COVID-19 Pandemic invoking Section 50 of the Act, 2005, which provides for emergency procurement and accounting. It was submitted that the authorities concerned were duty bound to procure medicine by resorting to the emergency provisions contained under the Act, 2005, in order to tackle the situations that had arisen during the pandemic. However, rejecting the above arguments of the petitioners, the division bench said the provisions of the 2005 Act have nothing to do with the investigation conducted by Kerala Lok Ayukta, because the provisions of Lok Ayukta Act, 1999 make it clear the manner in which the body has to conduct investigation and make recommendations to the government.The Court also rejected the argument that Sections 71 and 72 of the Act, 2005 place a bar of jurisdiction on Courts and that the enactment has an overriding effect over other laws. It said Section 71 of the 2005 Act creates a bar of jurisdiction of courts, other than Supreme Court or a High Court, in respect of anything done, action taken, orders made, etc, in pursuance of any power conferred by or in relation to its functions by the Act."As we have pointed out above, respondent No.1 has not made any...

Kerala HC Dismisses Petition Challenging Lok Ayukta's Probe Into Allegations Of Embezzlement In Procurement Of PPE Kits By KMSCL, State Govt

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