Supply of substandard machinery: LHC sets aside accountability court verdict

Contractor’s conviction quashed.

RAWALPINDI: The Lahore High Court (LHC) Rawalpindi bench has acquitted a contractor charged with corruption and has set aside his conviction.

An accountability court had convicted Sadaqat Saeed Malik to eight years rigorous imprisonment and had fined him $245,946 (Rs204 million). The accused later challenged his conviction in the LHC.

His counsel argued that his client was wrongly implicated in the case. He maintained that his client had supplied the machinery and other material according to the terms of the contract. He requested the court to set aside the conviction order.

LHC division bench judges Kazim Raza Shamsi and Ali Baqar Najafi, after hearing the appeal, observed that how the petitioner could be convicted if members of a technical evaluation committee, who were co-accused in the case, had been acquitted based on the same evidence.

“Corruption had not been committed by the appellant alone, therefore, his conviction is also not sustainable,” the bench observed.

The court further observed that the prosecution has no dependable evidence to prove that the appellant had committed the offence.

The National Accountability Bureau (NAB) filed a reference on May 1, 2000 against Malik for supplying ‘defective machinery’ to Oil and Gas Development Company (OGDCL).

According to NAB, Malik and other co-accused, who were later acquitted, managed to secure a contract for supplying skid-mounted oil and gas separators to OGDCL. The equipment he supplied was defective, causing a huge loss to the national exchequer.

According to NAB, Malik — the owner of Darwaish Aldarwaish, a firm black-listed by OGDCL — formed a new company named Safa International and secured the contract through manipulation as an agent of Hudson Industries, which is based in Ohio, USA.

However, when negotiations between the appellant and Hudson Industries failed, he formed a company with the same name — Hudson Industries — in  Houston, USA, and ‘falsely’ communicated to OGDCL that it was a subsidiary of the actual company, and requested that an amendment to substitute the supplier’s name be made in the contract in order to supply the equipment in time.

The amendment was later made in the contract mentioning that the contract was executed between OGDCL and Hudson Industries, Houston, purportedly a branch of Hudson Industries, Ohio.

The accountability court Rawalpindi-Islamabad convicted Malik and acquitted co-accused -- Mehtab Hussain, Hafiz Muhammad Aslam and Zahid Bakhtiar.

Raja Ikram Ameen Minhas, counsel for Malik argued that his client has not been convicted on the basis of Darwaish Aldarwaish being blacklisted or for concealing this fact and forming another company.

The appellant was convicted on the allegation that he supplied second-hand material which was manufactured in 1978, was not according to the specifications, and was not fit for use.

He further contended that the contract could not have been awarded to the appellant without the approval of the persons acquitted in the initial case.

“The co-accused have been acquitted, whereas the appellant has been convicted on the same evidence,” he said.

Published in The Express Tribune, July 10^th, 2015.