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Vigilance officials ready to charge Karunakaran in palmolein case

D Jose in Thiruvananthapuram

The Vigilance and Anti-Corruption Bureau has found former Kerala chief minister K Karunakaran guilty of criminal conspiracy in the palmolein import deal that rocked the state in 1991.

As per the probe, Karunakaran, by using his office, imported 30,000 tonnes of palmolein from Malaysia when there was no demand for it, and thus inflicted a loss of Rs 28 million on the state exchequer.

The agency, which took up the investigation after the Communist-led government came to power in May 1996, has clinched sufficient evidence to establish the conspiracy theory, sources said.

The vigilance department cannot file a chargesheet without the Supreme Court's permission, owing to a special leave petition that the senior Congress leader had filed against the Kerala high court's decision to reject his plea to quash the first information report. In its interim order on January 16, 1998, the SC had directed the investigating agency not to arrest Karunakaran without its leave.

Vigilance officials, therefore, now propose to approach the Supreme Court for permission to file a chargesheet before the court closes for vacation on May 10.

The important evidence against Karunakaran is the meeting he had with the representatives of the Malaysian-based Power and Energy Private Limited and the Mala Trading Corporation, Madras, in New Delhi, sources said. Karunakaran entered into a conspiracy with the representatives of the two firms in their meeting prior to October 4,1991 to import the edible oil by flouting the price stipulations of the State Trading Corporation, they added.

The probe found that the import was not warranted. Neither the Civil Supplies Corporation nor the food department had demanded it. The probe report said along with Karunakaran, then food minister T H Mustafa, former Civil Supplies Corporation chairman Zacharia Mathew and managing director Jiji Thomson, and former chief secretary S Padmakumar were also involved.

The investigation found that the deal violated state and Central government rules. The probe report said that the proposal for direct import was taken up with the Centre at a time when enough palmolein was being supplied by the State Trading Corporation. The import was made violating the Central government's conditions on price limit for procurement, terms of payment and fixation of retail price.

The probe also found another serious impropriety: The finance department, which was then headed by Oommen Chandy, who subsequently led the campaign for Karunakaran's ouster, was not consulted.

This is the second major case haunting Karunakaran. The investigation into the former chief minister's alleged amassing of wealth beyond known income is on. In fact, the vigilance department had recently subjected Karunakaran to a five-hour interrogation in the case. The case was filed by Nawab Rajendran as a private complaint.

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