Initiate probe against officials responsible for financial loss in awarding tender to China's ZTE: Delhi High Court to BSNL

The Delhi High Court has ordered Bharat Sanchar Nigam Limited (BSNL) to initiate departmental action against its officers for causing financial loss to the State-run telco in relation to the tender awarded to Chinese tech company ZTE Telecom Limited..A Division Bench of Chief Justice Satish Chandra Sharma and Justice Subramonium Prasad issued the direction while disposing of a Public Interest Litigation (PIL) filed by an NGO named Telecom Watchdog.The PIL had alleged that there was a criminal conspiracy between some officials of BSNL and ZTE. It was stated that even though a complaint was made to the Central Bureau of Investigation (CBI) in March 2016, the agency did not register a first information report (FIR) and conducted only a Preliminary Enquiry (PE).Notices were issued in the PIL in January 2017 and three status reports were filed by the CBI stating that it had initiated a PE and the same was closed because there was no material to proceed further.The CBI’s closure report gave certain recommendations which included departmental inquiries against BSNL officials. .The CBI report stated that BSNL officials were responsible for financial loss and technical degradation caused to the telco because of its add-on work contract with the ZTE. The tender was awarded to the Chinese vendor in the year 2011 for Phase-VII Expansion of GSM/UMTS (2G/3G) based Cellular Mobile Network in North, East and South Zones.The CBI’s status report said that the BSNL officers formulated improper tenders, and that there was a lack of planning before purchase orders were issued.The agency has said that self-contained notes must be sent to the Enforcement Directorate (ED) as well as the Income Tax Department for dubious payment of ₹5.25 crore and for taking necessary action regarding transactions between ZTE and M/s Trimax IT and Infrastructure Ltd.The allegation is that money raised through Trimax was routed to pay the BSNL officials, but the CBI did not find any evidence for the same..After considering the case, the Bench noted that since the CBI has concluded its investigation, no further directions are required to the agency. However, the Court ordered BSNL to initiate departmental action, as suggested by the CBI.The Court clarified that it has not expressed any opinion on the merits of allegations on the officers.“This Court, however, directs the BSNL to initiate departmental action, as suggested by the CBI, against its officers. It is made clear that this Court has not expressed any opinion on the merits of the imputations of allegations on the officers of BSNL. Any action initiated by the BSNL be taken to its logical conclusion on its own merits,” the order stated.CBI was also directed to supply a copy of the closure report to the petitioner disclosing the reasons, in brief, for closing the complaint and not proceeding further..Advocates Prashant Bhushan and Pranav Sachdeva appeared for the petitioner.CBI was represented through Special Public Prosecutor Anupam S Sharma along with Advocates Prakarsh Airan, Harpreet Kalsi, Abhishek Batra and Ripudaman Sharma..[Read Order]