SC declares Gilani-approved security project ‘non-transparent, illegal’

Bench says entire transaction was carried out in non-transparent manner for a cost which appears to be inflated.

ISLAMABAD: The Supreme Court on Wednesday declared former prime minister Yousaf Raza Gilani’s approved Safe City Project for Islamabad and Peshawar non-transparent, illegal and invalid on Thursday.

A three-judge bench of the apex court headed by Justice Nasirul Mulk announced the detailed judgment which said that the entire exercise of the project appeared to be farcical and it was a ‘classic case’ of pleading the law to defeat the law.

Chairman National Accountability Bureau (NAB) Admiral (retd) Fasih Bokhari has been asked to take legal action against this scam which involves high-level government officials, including former premier Gilani, who was ousted from his office after he was convicted of contempt by a Supreme Court bench.

The contract of the project approved on December 29, 2009 was for the procurement of goods, equipment and services for the purpose of establishing a Command Center and Network to counter terrorists’ activities, initially in Islamabad for the total cost of $124,719,018. The project is referred to as Islamabad Safe City Project that was the brain child of the interior ministry and its attached department National Database Regulatory Authority (NADRA).

Apparently in the summer of 2009, Chinese Company M/s Hauwei Technology Company Limited approached Nadra offering to implement and execute a comprehensive surveillance and monitoring system for security primarily in Islamabad. Nadra claims to have informed its parent ministry regarding the offer made by the company.

The Nadra chairman indicated to the interior secretary of the possibility of obtaining a long-term concessional loan from the Chinese government or the Export-Import Bank of China, whereupon the Economic Affairs Division was activated by the interior ministry for the allocation of the concessional loan from China.

In January, 2011, this contract was challenged in the apex court by a citizen who alleged that the entire transaction has been carried out in an illegal and unlawful manner causing a huge loss to the public exchequer. It was contended that a similar project was undertaken for the City of Karachi in the year 2008-2009 at a total cost of $8 million.

After various hearings, the court reserved its judgement on Thursday. The judgement authored by Justice Sheikh Azmat Saeed said that the entire transaction was carried out in a non-transparent manner and for a cost which appears to be inflated.

The apex court directed the government to reinitiate the process for the procurement of the required equipment, software and services in a fair, just, rational and transparent manner, strictly in accordance with the provisions of the Public Procurement Regulatory Authority Ordinance, 2002 and the Public Procurement Rules, 2004 and the law.

“Needless to say that the respondent company would be at the liberty to participate in such de novo process of procurement,” the court order mentioned.

“The contract dated 29 December, 2009, is illegal and invalid having been executed in violation of the mandatory provisions of the Public Procurement Rules, 2004, as the exemption there from purportedly granted under Rule 42 (c)(v) was based on extraneous and irrelevant reasons and therefore of no legal effect or consequence,” read the judgment.

“In fact, it has been indicated to us that various other Chinese companies were in a position to offer similar goods and services. The entire market, both national and international, was never taped. There was admittedly no conscious application of mind at the time of the grant of the approval by the prime minister that Rule 5 or 14 or both were applicable to the transaction in question,” the order added.

The court order further stated that even as per the report of the Planning Commission referred to in the summary to the prime minister dated June 7, 2010, the net present value of the project was $72 million, while the contract has been awarded for a total amount of $124.7 million.

Furthermore, all government departments and concerned authorities other than the Ministry of Interior repeatedly indicated that the cost of the project is at least three times higher than the value of the equipment being supplied. They added that the contract in question was executed on December 29, 2009, when the PC-I had not even been prepared.