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  SC gives clean chit to NRB ex-guv
Kshetry's future uncertain


(Update III with background details)

: The Supreme Court (SC) on Wednesday gave a clean chit to former governor of Nepal Rastra Bank (NRB) Bijaya Nath Bhattarai and executive director Surendra Man Pradhan, who were charged with corruption.

Following the SC verdict, Bhattarai will soon replace incumbent governor Deependra Bahadur Kshetry as per a provision of the Anti-corruption Act 2059. “However, the cabinet will have to take a decision to retire Kshetry and appoint Bhattarai to the post of governor of NRB”, Purna Man Shakya, constitutional expert, told

This is the second time in Nepal´s history that a dismissed governor of the central bank is being reinstated on the basis of a Supreme Court verdict. In April 2001, the Supreme Court reversed a government decision to dismiss then NRB governor Tilak Rawal and the SC reinstated him in the post.

The Commission for Investigation of Abuse of Authority (CIAA) had charged then sitting NRB Governor Bhattarai and Executive Director of the Financial Institutions Regulation Department, Surendra Man Pradhan, with embezzlement of Rs 24.5 million that NRB had received in grant from the World Bank for a financial sector reform program. Both Bhattarai and Pradhan were suspended from their posts after the CIAA filed cases against them at the Special Court on June 2007.

Bhattarai´s tenure as governor will end in February next year while Pradhan´s tenure is already over. The Maoist-led government had appointed Kshetry as governor after dismissing Bhattarai as per a verdict of the Special Court indicting both of them for involvement in corruption.

“Since the amount reimbursed by the World Bank was made in full consent of the donor, it cannot be termed as corruption”, said the SC verdict. The verdict handed down by a division bench of Justices Kheel Raj Regmee and Prem Sharma further said that neither of the defendants was found misusing the amount for their personal benefit nor did the decision they took damage the NRB financially.”

Talking to reporters after getting a clean chit from the apex court, Bhattarai said he will continue the reform process that he had initiated at the central bank with renewed determination. “This is a victory for truth and justice”, he said.

After the Special Court on February 2008 failed to come up with a unanimous verdict on the corruption charges filed by the CIAA, the case was referred to the Supreme Court. A single bench of the Supreme Court, acting in the capacity of a Special Court, convicted both Bhattarai and Pradhan on March 2008 on the corruption charges.

NRB had inked an agreement with American contractor MSIF INC for consultancy services for a financial sector reform program funded by the World Bank. The agreement had a provision under which payments were to be made only after receiving both inspection and work plan reports from the contractor. However, the CIAA charged that NRB released the amount, totaling Rs 5 million, after receiving only the inspection report, and not the work plan.

Later, NRB terminated the contract with the consulting company, arguing that it failed to perform its duty in the stipulated time. CIAA began investigations into the charge that NRB didn´t claim any compensation from the company after terminating the contact.

While investigating the files, CIAA found that NRB had signed an agreement with a consortium of MSIF INC and a Sri Lankan branch of the KPMG company. However, KPMG denied involvement in the agreement.

Published on 2009-07-15 15:57:01
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SC Gives Clean Chit To NRB Ex-guv
Kshetry's Future Uncertain
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The Supreme Court clean chit to former governor of Nepal Rastra Bank Bijaya Nath Bhattarai and executive director Surendra Man Pradhan, who was charged with bribery, finally has proved that they were indeed actually spotless. It was just due to jealousy of some group of people who carried them to the courtyard. Judges involved in the final decision in this case have made an unambiguous judgment and are really courteous. Actually speaking, it would have been an unfair decision if they were pun [more]
  - gumansingh,dhumbarahi
What is the purpose of this CIAA? Did it ever find a culprit? Dismiss this institution whose job is only to offer clean chit to every body they bring on show. What the hell are they doing there wasting people´s money. They charge and discharge later wasting taxpayer´s money. Such useless goon of people should be dismissed along with this organization. Period. [more]
  - GyaRel
Good men were targeted by a corrupt and over jealous regulator. This decision gives me some hope on Nepalese legal system: otherwise I had lost all. [more]
  - Raj Acharya
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