Former Tamil Nadu Fire Services Director E Hariharane and managing partner of Chennai-based M/S Nisarz and Company Y Md Ziauddin were acquitted of all charges in the Rs 23.82 lakh scam by special judge V Radhakrishnan.

The special court was formed to exclusively try 46 cases of corruption against former Chief Minister J Jayalalitha, her erstwhile cabinet colleagues, IAS and IPS officers and others. The fire services scam, however, dates back to the earlier DMK regime during 1989-90.

Coming down heavily on the prosecution, the judge in his 30-page order, said that ``the theory of conspiracy put forward by the prosecution is weak and far-fetched." The charges included that Hariharane had misused his official position to secure penuniary advantagefor a supplier of fire fighting equipment. According to the court, ``the prosecution wants to make a mountain out of a mole hill by relying on insignificant circumstances. Therefore, the accused are entitled to be acquitted under Section 248 of the Criminal Procedure Code.''

Ripping apart almost every contention of the prosecution, the judge said that ``in the present case the materials placed before me had not revealed that there was a meeting of mind between the accused for obtaining pecuniary advantage.''

The prosecution alleged that there were irregularities in awarding a tender for fabricating five crash tenders (fire fighting equipment/vehicle) which resulted in pecuniary advantage to Ziauddin to the extent of Rs 23,82,260. At that time Hariharane was the Director of Fire Services. The company was exempted from paying the Earnest Money Deposit (EMD) and Security Deposit (SD). This exemption was granted only to companies holding a National Small Industries Corporation (NSIC) certificate. However,Nisarz and Company had used the NSIC certificate of its principal company Wadia Body Builders (WBB), Ahmedabad.

The judge held that WBB is a reputed manufacturer of fire fighting equipment in the country and it is a leader in this business. Moreover, Ziauddin had produced the NSIC certificate of WBB and this will exempt payment of EMD and SD. The reasons given by Hariharane for accepting the tender ``has not been questioned during internal audit.'' There seems to be no irregularity in granting an advance of Rs 22,98,585 to the company as the money was lying unutilised for four years.''

The delay in taking a decision regarding the tender three months after it was opened cannot be treated as a circumstance to indicate that Hariharane is guilty of criminal misconduct, the judge said. So far as the inexperience of Nisarz and Company is considered the ``ministerial staff should have taken care to include this in the draft tender and Hariharane cannot be held responsible for this omission.'' In fact, WBB, whichhad earlier supplied pumps through Nisarz and Company to the Fire Services Department, has abundant experience. The fact that Nisarz and Company supplied several items on earlier occasions to the Department would go a long way to show that it is not a bogus company ``as sought to be made out by the prosecution.''

If the prosecutor's characterisation of Ziauddin as a middleman is accepted then the Principal of Agency recognised by the Law of Contracts becomes meaningless, the judge said. ``If the middleman is to be eliminated the law relating to Agency should be scrapped from the Statute Book,'' the judge observed. Hence, as an agent Ziauddin is entitled to take commission for the services rendered. This commission cannot be treated as pecuniary advantage gained illegally by him.

Pointing out that there is no rule stipulating that Government Departments should purchase required things only directly from the producer or manufacturer, Radhakrishnan noted that ``it is high time such a rule is introduced.''