Supreme Court Upholds High Court Conviction of former -President Sirisena’s Chief of Staff Mahanama and Ex-Timber Corporation Chairman Dissanayake for Soliciting Mega Bribes from an Indian Businessman Over a Deal Relating to the Kantalai Sugar Factory

By Namini Wijedasa

The magnitude of the bribes solicited from an Indian businessman by two senior Sri Lankan public officials–including former President Maithripala Sirisena’s one-time Chief of Staff–to unblock a legitimate project were “unimaginable”, the Supreme Court (SC) observed this week.

The Court stressed that “it would be difficult for this country to revive itself as long as high officers like the accused-appellants would hold such high offices in the Government”.

The first accused-appellant is I.H.K. Mahanama, who was Secretary to the Ministry of Lands before he retired and was made Chief of Staff to then President Sirisena. The second is Piyadasa Dissanayake, the former Chairman of the State Timber Corporation.

In December 2019, they were found guilty by the Permanent High Court (HC) at Bar of several charges under the Bribery Act. This included demanding Rs 20mn from the Indian representative of a foreign company that won a build-operate-transfer deal for the Kantale Sugar Factory (KSF).

Both officials appealed. But the SC on Wednesday upheld the HC verdict and affirmed the sentences imposed. For Mr Mahanama, this amounts to an aggregate of 20 years rigorous imprisonment (RI) with a fine of Rs 65,000 and compensation of Rs 20mn in terms of the Bribery Act. And for Mr Dissanayake, it is an aggregate of 12 years RI with a fine of Rs 55,000.

The bench comprised Justices Vijith K. Malalgoda, PC, L.T.B. Dehideniya, P. Padman Surasena, S. Thurairaja, PC, and Yasantha Kodagoda, PC. Justice Kodagoda also gave a concurring separate judgment on the question of “the right to a fair trial”.

The accused-appellants were indicted by the Director General of the Commission to Investigate Allegations of Bribery or Corruption (CIABOC) for conspiring to solicit a sum of US$ 3mn (Rs 1bn at current rates), in the first instant, and later Rs 100mn–as well as accepting Rs 20mn– from Kotagaralahalli Pedappiah Nagarajah as gratification, inducement or reward.

Mr Nagarajah represented a foreign company that had won a build-operate-transfer deal for KSF. The payoffs were demanded in exchange for “approving” the handover of the sugar factory’s machinery although, as opined also by the Attorney General, no such approval was requisite. The offences took place between August 2016 and May 2018.

“We have already mentioned before that both the accused-appellants at the time they solicited and accepted the bribes relevant to the instant case were holding very high posts in the highest echelons of the Public Service of this country,” the SC’s five-judge bench observed. “The magnitude of the bribes they have solicited are unimaginable.”

“The purpose for which they were solicited no doubt shows that the accused-appellants while holding high positions of the Government had only worked for their unlawful and immoral purposes while only helping the destruction of the country’s economy,” it held. “We are of the view that it would be difficult for this country to revive itself as long as high officers like the accused-appellants would hold such high offices in the Government.”

“We therefore think that it would be important to take into account the need to deter such public officers from being inclined to embark on such unlawful endeavours,” the Court determined.

The Court proceedings provide a window into how two powerful officials held up a project for which all necessary approvals–including explicit clearance from the Attorney General’s Department–had been obtained, in order that they may extract heavy bribes.

In 2015, Mr Nagarajah submitted an unsolicited offer to the Sri Lanka Government to restart KSF through Prabhulingeshvar Sugar and Chemicals Company, a leading Indian sugar manufacturer.

He met Mr Mahanama at his office in August 2016. At this meeting, the Sri Lankan official solicited a gratification of US$ 3mn to execute the project even though the relevant shareholder’s agreement had already been signed.

During this period, Mr Mahanama was directly involved in implementing the project as Lands Ministry Secretary. He informed Mr Nagarajah that if he did not pay up steps would be taken to dispose of the existing machinery without giving it to the investor (despite such handover being a condition in the shareholder’s agreement).

As the bribe was not forthcoming, Mr Mahanama advertised the sale of machinery in the newspapers. He had also earlier taken other steps to delay implementation of the agreement. It was then that Mr Dissanayake met Mr Nagarajah and urged him to resolve his dispute with Mr Manahama.

The investors had already spent more than US$ 20mn on the project so Mr Nagarajaha brought the matter to the notice of Prime Minister Ranil Wickremesinghe. He also met an officer of the Prime Minister’s office who advised him to lodge a complaint with CIABOC. While he did not do so, he was later summoned by a CIABOC investigator. He provided a written complaint after which the proceedings started.

Among other things, counsel for the accused-appellants argued that the investigation into the complaint received by the CIABOC was conducted in an unlawful manner; that the indictment was ex facia ultra vires the provisions of section 11 of the CIABOC Act; and that the charges in the indictment were not framed in a lawful manner. These were dismissed and the HC’s determinations were upheld, too, in all other instances.

Anil Silva, PC, with Chandika Pieris, Nandana Perera, Dhanaraj Samarakoon and Isumi Jayawardena appeared for Mr. Mahanama. Gamini Marapana, PC, with Navin Marapana, PC, Kaushalya Molligoda, Uchitha Wickremasinghe, Gimhana Wickramasurendra, Thanuja Meegahawatta and Saumya Hettiarachchi instructed by Sanath Wijewardena appeared for Mr. Dissanayake.

Deputy Solicitor General Janaka Bandara with State Counsels Udara Karunathilleke and Kasun Sarathchandra appeared alongside CIABOC Assistant Director General Subhashini Siriwardhena and CIABOC Assistant Director Legal Anusha Samandapperuma.

Courtesy:Sunday Times