Kerala High Court stays govt ban on PwC for two weeks

The IT department had barred the consultancy firm for two years over “failure of ensuring due diligence in the deployment of resources.”
Kerala High Court
Kerala High Court
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The Kerala High Court has stayed the state government's order barring London-based multinational Pricewaterhouse Coopers Private Limited (PwC) from participating in projects related to electronics and IT for two years. A single judge bench of Justice PV Asha stayed the government order for two weeks. The state IT Department had given the order banning PwC on November 24 in light of the consultancy firm’s recruitment of Swapna Suresh - the main accused in the gold smuggling case - to the Space Park Project, of which PwC was a consultant. PwC and another IT firm, Vision Technologies, were responsible for verifying the documents submitted by Swapna to secure a job in the Space Park Project which is under the IT Department.

Swapna allegedly submitted a fake graduation certificate to secure the job. The two firms and Swapna, who was arrested and is in jail in relation to the gold smuggling case, were booked by the police in July for cheating and forgery. The police action was based on a complaint by Kerala State IT Infrastructure Limited (KSITIL). Swapna is a former employee of the Consulate of the United Arab Emirates at Thiruvananthapuram.

The Kerala government's contract with the consultancy firm was terminated on November 30 for “failure on the part of PwC in ensuring due diligence in the deployment of resources.” In a petition filed at the HC, PwC denied any mala-fides claiming that the “individual found to have indulged in unrelated illegalities was appointed on the recommendation of the Managing Director of the Kerala Fibre Optic Network (KFON) and Space Park projects, according to Bar and Bench.

The petition also states that the failure of the government to provide PwC an opportunity to be heard violates the principles of natural justice. The petition also stated that background checks had been duly performed, and assailed the termination notice and subsequent blacklisting of the firm, contending that it ought to have been allowed to defend itself, and be heard, prior to the order against it.

PwC was also appointed to the Project Management Unit for two projects of the government – the KFON and the Space Park Project. The government order also said that the contract for KFON won't be renewed.

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