HC lays down stringent rules to curb contract mafia | india | Hindustan Times
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HC lays down stringent rules to curb contract mafia

india Updated: Jul 14, 2006 01:35 IST

IN AN attempt to eliminate criminals and mafia from grabbing government contracts, the High Court today laid down stringent guidelines for the acceptance of contract tenders above Rs two lakh in all the government departments.

The court also directed the state government to establish an “organised crime control authority” to control the activities of the mafia.

The court directed the state government not to accept the contract bid from the contractors without “no objection certificate” from the Income Tax Department, Trade Tax Department, District Magistrate and Superintendent of Police of the district. The court said no contract should be accepted unless the contractor furnishes a character certificate given by superintendent of police or senior superintendent of police as well as the district magistrate relating to the antecedent of the contractor as well as his financial capabilities to do the contractual work. The government may provide necessary format for that purpose, the court said.

The above directives containing detailed instructions to check organised crime prevailing in the government departments, including local bodies and corporations, were issue by the court while quashing a mining lease contract said to have been obtained by an associate of a sand mafiosi.

In his landmark judgement, Justice DP Singh, while allowing twin writ petition filed by Chandrika Prasad Nishad and Bhola Nath Nishad respectively, said “let recommendation of Patnaik Committee relating to the grant of contract be enforced forthwith. The State Government is further directed to issue appropriate government order or circular providing that every contract or tender costing two lakh or more shall not be accepted by the department of State government or its local bodies or corporations unless and until ‘no objection certificate” is obtained.

The court directed the state government to constitute an organised crime control authority headed by an officer not below the rank of principal secretary empowering it to receive complaint and make investigation or to investigate the charges relating to government contracts, lease or agreement where the involvement and malpractices of mafia or organised crime was suspected.

In every district a committee should be constituted to hold an inquiry relating to the involvement of mafia in the contracts relating to government, its local bodies and corporations. Appropriate regulatory rules or guidelines may be framed by the State Government forthwith and government order may be issued accordingly, the court said.

The court further said that “every government agreement must contain a clause to indicate that even after awarding of contract or lease of work by the Government or its local bodies or corporation, in case it comes to light that the person concerned (contractor) has been actively associated with mafia or some anti-social elements or organised crime, the contract or lease, so granted, shall be cancelled after serving a show-cause notice.

The agreement of the contract should also contain enabling clause with power to rescind the contractor lease as the case may be in case it is borne out from the record or it is proved that some of the prospective bidders were threatened or prevented from participating in the bid or they were prevented to submit their tenders. In such a case, contract shall be cancelled and fresh assignment shall be given after inviting fresh tenders. As far as possible government shall ensure that physical presence of prospective bidders may not be made necessary. As observed by Patnaik Committee, tenders or bids may be given by e-mail, registered post or other electronic mode.”     

The court said, “In case prospective bidder or contractor submits a complaint, stating that he or she has been threatened with dire consequences in case he or she participates in a bid or submits tender, then the head of the district police or the State government shall immediately provide appropriate security to such person for reasonable period and shall register an FIR for investigation in accordance to law”.

The court said that “since the movement of armed personnel collectively along with the persons holding whatsoever post, office or designation, creates fear psychosis in public, the state government is directed to ensure that those who used to move with private armed personnel should not be given official or police security. Such persons shall not be entitled to claim police security from the state government. Similarly, those persons who form an assembly or move collectively along with persons having police security shall not be entitled to possess armed licence and DM of the district concerned will have right to cancel their fire arms licences. The State Govt may issue appropriate order or circular accordingly.”