Rinzin Wangchuk and Tashi Dema
The Supreme Court (SC) revoked a suspension order the Anti-Corruption Commission (ACC) issued against three construction companies on September 2.
ACC issued a two-year suspension order against Chimmi RD Construction, Phuntsho Rabten Construction and Sonam Jamtsho and Bros Construction in May this year after the Construction Development Board (CDB) reduced their earlier two-year suspension order against the companies to three months.
CDB in March this year suspended the three companies for two years based on ACC’s recommendation, but later changed the decision and reduced it to three months.
ACC recommended CDB to suspend the contractors after their investigation found the three companies colluded while bidding for base course and blacktopping of Jarey gewog connectivity road in 2015.
ACC then wrote to the CDB that the three-month suspension does not commensurate with the severity of procurement irregularities and will not serve as deterrence to unethical practices in the future.
It then stated that the attempt to bid rigging by the three contractors caused a financial loss of more than Nu 11.77 million to the government.
In July this year, Chhimi RD Construction’s proprietor appealed to the SC, contending that ACC, as an investigating agency, does not have the legal authority to take administrative actions.
It also contended that ACC’s suspension order without SC’s permit is against the Constitution. “ACC cannot be the investigating agency and take actions,” the appeal letter stated.
Although the SC judgment was not clear, sources following the case said it indicated that ACC should have instituted a debarment committee and referred the case to the committee.
It stated that section 137, 139 (II) and section 40 (5) of Anti-Corruption Act is a guideline for debarment and not for ACC to take administrative action.
The judgment stated that ACC should follow the doctrine of harmonious construction and based on the principles of reasonableness CDB used, it was not necessary for ACC to suspend the contractors. “ACC can only ask concerned agencies to take appropriate actions and not take actions.”
SC also ruled that the three contractors have been suspended for five months now and that should suffice as the penalty levied on them.
Meanwhile, the case surfaced after the Royal Audit Authority (RAA) on August 28, 2018, wrote to the ACC pointing out possible collusion among bidders where Department of Roads’ regional office in Lingmethang invited bids for the base course and blacktopping of Jarey GC road on August 28, 2015.
Four prospective bidders participated in the bid.
ACC investigation revealed that before the arithmetical correction made in three bids by a contractor, Chhimi RD Construction quoted Nu 35.957M, Phuntsho Rabten Construction quoted Nu 43.922M, Diamond Construction quoted Nu 47.734M and Sonam Jamtsho and Bros Construction quoted Nu 36.858M.
In the tender opening, although Chimmi RD Construction quoted the least after the arithmetical corrections, Diamond Construction which was earlier the highest bidder became the lowest. The work was then awarded to Diamond Construction on November 13, 2015.
Further review of the individual bidding documents by ACC revealed that the rates for all the Bill of Quantities (BoQ) items for all the bidders, except Diamond Construction, were either overwritten, inserted with additional digits or showing marks of striking off and re-writing.
The total amount of the BoQ however was left unchanged. “It was evident that all the corrections made were of similar in nature. Upon further scrutiny of the bidding documents, the initial of the bidders on the corrections made were similar of all three BoQs of Chimmi RD Construction, Phuntsho Rabten Construction and Sonam Jamtsho and Bros Construction,” ACC’s report stated.
In their statement to the ACC, one of the contractors said that bid rates were increased only after discussing among three contractors. They claimed that the rates were increased after finding out the workplace at Jarey gewog was too steep and difficult to work at their quoted rates.
The winning bidder, Diamond Construction, meanwhile turned out to be an independent entity and he stated that he submitted the bidding documents without any knowledge of who the other bidders were.
Based on the investigation findings, ACC officials said that the investigation review committee (IRC) deemed that although there was an attempt to commit a crime by the contractors, there was no benefit received by the action committed which had no evidential value for further actions.
The IRC recommended cautioning the three contractors in writing with copies to all the relevant agencies for future deterrence and vigilance.