No bail application for Aloysius today: Marapana PC ensures CA

-  Kalinga Indatissa PC points that petitioners have correctly invoked appellate jurisdiction and therefore the ability of the revision application being maintained at Court of Appeal

-  ASG Kodagoda says the Magistrate can remand the suspects even for maximum of two years considering the provision ‘public disquiet’ under the Bail Act

By Shehan Chamika Silva

President's Counsel Gamini Marapana who appeared on behalf of Arjun Aloysius in the revision bail application today ensured the Court of Appeal that no fresh bail application will be filed in magisterial inquiry today on suspect as it could question the revision application being continued in the Court of Appeal.

Additional Solicitor General Yasantha Kodagoda drew the court's attention that there was an advance notice to the state from President's Counsel Anil Silva over a fresh bail application to be made today before the Fort Magistrate.

The Court of Appeal president Prithi Pathman Surasena observed that if the petitioners are in expectation over seeking an alternative remedy considering the change of circumstances in the magisterial inquiry, then the Court of Appeal is unable to see any justification to proceed with the revision application.

Thereafter, President's Counsel Gamini Marapana made his under taking that such application would not be made today.

At the onset, resuming his further submission, Additional Solicitor General Yasantha Kodagoda elaborated the all allegations that put forward against the suspects in the magisterial inquiry and based on those allegations how the Bail Act operates in the question of granting the bail.

While explaining the possibility of keeping the suspects under the remand custody according to the Bail Act, he stated that the magistrate could remand suspects considering the public disquiet that may arise due to the alleged matter.

He said the Treasury Bond scam inquiry is an incident that spontaneously came into light of the general public not just because the Public institutions that were part of this fraud but its macro economic impact to the society which can never be estimated.

ASG Kodagoda observed that therefore the suspects could be kept in remand custody for maximum of two years as per law by a magistrate even only considering the aspect of 'public disquiet'.

Meanwhile, making counter submissions, President's Counsel Kalinga Indatissa argued on ASG's previous preliminary objection that the petitioners have not invoked the appellate jurisdiction of the Court of Appeal.

Pointing out a paragraph in the revision petition, he held that the petitioners have exercised their right to appeal properly in addition to the revision application which which sought against the High Court order.

Therefore, he maintained that the respondents preliminary objection cannot stand over the jurisdiction.

Mr. Indatissa also drew the attention of the court on the legal question as to whether the Treasury Bond could be regarded as property as per prevailing law.

Questioning the way in which the Fort Magistrate made it count as a property, he argued that the Bond is a concept which cannot be regarded as a tangible property and therefore the offences cannot fall under the public property.

The further inquiry relating  to the revision bail application filed on behalf of Arjun Aloysius and Kasun Palisena was re-fixed for July 18 by the Court of Appeal Bench comprising Justice Shiran Gunaratne and Prithi Padman Surasena (President).

Earlier, the Fort Magistrate remanded the suspects considering the allegations levelled against them under the Public Property Act. And later, the suspects went to the High Court as the magistrate cannot release them on bail as per the PPA, where one who misappropriated public property causing more than Rs. 25, 000 damage to the state has no bail relief unless exceptional circumstances or by a high court judge.

However, Colombo High Court also refused to grant bail on suspects set a siding the suspects’ petitions. As a result, the suspects filed a revision bail petition in Court of Appeal to revise the bail order of the Magistrate and the decision of the High Court.

Five civil suits against PTL claiming Rs. 8.5 bn: ASG Kodagoda

Cases were filed on behalf of :

• Employees Provident Fund
• Employees Trust Fund
• National Savings Bank
• Insurance Corporation of Sri Lanka
• Provident Fund of the University Grants Commission

By Shehan Chamika Silva

During the submissions made by Additional Solicitor General Yasantha Kodagoda over the revision bail application filed by Arjun Aloysius and Kasun Palisena, it was revealed that the Attorney General had so far filed five civil cases in the District Court on behalf of five state institutes against Perpetual Treasuries Ltd (PTL).

These civil cases were on behalf of Employees Provident Fund, Employees Trust Fund, National Savings Bank, Insurance Corporation of Sri Lanka and the Pension Fund of the University Grants Commission.

The state in these law suits claimed a total of Rs. 8.5 billion from Perpetual Treasuries Ltd with regard to the unlawful profits gained by PTL in the Treasury Bond transactions which resulted in incurring huge losses to the above five entities.

Disparity in Bribery Act raised at revision application filed by Gota

Revision application filed by Gota in CA over Avant Garde case:

Counsel raises disparity in Bribery Act  

Romesh De Silva PC points out that HC had given order by interpreting ‘non-existing’ section in the Act

By Shehan Chamika Silva

Bringing an unexpected legal argument, President’s Counsel Romesh de Silva today contended that the order given by the High Court judge over the Avant Garde corruption case filed against former Defence Secretary Gotabaya Rajapaksa and others cannot stand as the Judge had interpreted none existing section of the Bribery Act.

Earlier, when the Bribery Commission filed the corruption case against the suspects in the Chief Magistrate’s Court, the defense took the stance that under the section 78 (1) of the Bribery Act there was a need of a written sanction by the ‘Commission’ so as to institute such an action by the prosecution, therefore the case should be dismissed.

However, this argument was overruled by the Chief Magistrate and then the defense filed a revision application in High Court against the Chief Magistrate’s order.

High Court Judge too referring to the section 78 of the Bribery Act rejected to allow defense argument.

Consequently, the defense filed a revision application in the Court of Appeal against the High Court order.

Bringing a whole new aspect to the defense argument, Romesh de Silva PC yesterday challenged the High Court Judge’s order.

Mr. de Silva said that while High Court Judge was interpreting section 78 of the Bribery Act (upon which the defense’s legal argument is based on), he had referred to a wrong section which does not exist as law.

Mr. de Silva elaborated that the section 78 was prevalent since 1954 in the Country’s Bribery Act. Then in 1980 through an amendment to the Act (No: 2, 1980 Amendment Bribery Act) the section 78 had been removed and introduced a new section to it.

Then the amended section was the established law until another amendment introduced to the Bribery Act which came into effect in 1994 (No: 20, Amendment Bribery Act).

Mr. de Silva that the 1994 amendment into the section 78 had also included an amendment to a phrase which is not there in the 1980 amendment and therefore the 1994 amendment is wrong.

He was of the view that therefore the consolidated Bribery Act upon which the High Court Judge had given his order is therefore a wrong law.
In view of the submissions made by Counsel Romesh de Silva PC on the issue of law, Senior State Counsel Janaka Bandara appearing for the Attorney General pleaded time to study disparities carefully.

Court fixed the matter for further submission on tomorrow the 4th (Wednesday) whereas the High Court trial is billed for July 9.

Counsel Romesh de Silva PC informed Court that he will support for notice and Interim Relief on that date.

Romesh de Silva PC with M.U.M.Ali Sabry PC, Sugath Caldera, Ruwantha Cooray and Farith de Mel instructed by Sanath Wijewardande appeared for Gotabhaya.

Petitioner Gotabhaya Rajapakse filed Revision application in the Court of Appeal on the High Court rejection of his application sought to acquit and release him from Avant Garde Case.

He cited Director General of Bribery Commission as complainant-Respondent and Sujatha Damayanthi Jayaratne, Piyasiri Fernando, Banda Fernando Egodawela, Somathilake Dissanayake, Nissanka Yapa Senadhipathy, Kumarasiri Kolambage and Jayantha Perera as Accused-Respondents.

He states the Director General of Bribery Commission instituted proceedings in the Colombo Magistrate’s Court.

He states on the first opportunity available, his Counsel moved Court to raise a preliminary objection on the maintainability of the action wherein it was contended that the complainant had failed to satisfy a mandatory pre-requisite namely written sanction of the Commission.

He states the Magistrate on 17th November 2017 overruled the preliminary objections and moved to read the charges and ordered the suspects to record their plea for the charges which were read out in open Court.

Being aggrieved by the said orders of the Magistrate, he filed application in the Colombo High Court for revisionary jurisdiction.

The High Court Judge on 2nd February 2018 his order refused to issue notices and dismissed the petition.

Being aggrieved with this order he now filed revision application in the Court of Appeal seeking to stay the proceedings in the Magistrate’s Court until the final determination of this petition and to revise/set aside the orders of the High Court and allow him to revise the Magistrate’s Court.

Arjun Aloysius re-remanded, his father Geoffrey Aloysius noticed

-Prosecution eyeing on more wrong doing committed by the suspects 

-10,000 cheques are being perused over PTL's alleged money trading: SDSG Jayasundara 

-Palisena, Aloysius re-remanded till July 5 

By Shehan Chamika Silva


Fort Magistrate Lanka Jayaratne today issued a notice on Geoffrey Aloysius (father of Arjun Aloysius), who is the chairman of Perpetual Treasuries Ltd (PTL), to appear before the court on next date to show cause its failure to fulfill the previous court order which directed it to provide a comprehensive declaration with regard to the direct and indirect assets of PTL through an auditor.

Senior Deputy Solicitor General Haripriya Jayasundara appearing for the CID said that PTL as the third suspect of the magisterial inquiry had failed to comply with the court order given on June 7, 2018.

The defence moved to consider the difficulties that are being confronted by the company in employing an auditor in order to prepare such a report on its assests.

When questioned by the Court, it was revealed that there was no representation for the PTL yet in the inquiry and consequently the magistrate directed to issue a notice on PTL's chairman to appear before the court.

However, the Magistrate also considered granting an opportunity for PTL to request for any documents in the custody of the prosecution in the course of preparing such a asset declaration because the CID had already, during a search warrant, had acquired documents belonging to PTL.

Responding to the failure to provide asset reports of other two susects, President's Counsel Anil Silva who appeared for Arjun Aloysius requested further time to respond in that regard as he was the new legal appearnce for the suspect.

President's Counse Kalinga Indatissa who appeared on behalf of Kasun Palisena said that his client is ready to comply as far as possible with the required details of his assests despite the difficulties he faces being in remand custody.

Magistrate Jayaratne, advised the both counsel to provide the required details in due course without further unnecessary delay.

SDSG Jayasundara also sought the court to issue an order against PTL over its failure to provide required details of its all direct and indirect payments made to the third party individuals and institutions, to the CID so as to use them for the forensic audit which is being conducted by the Central Bank at the moment.

However, contemplating the possibility of questioning about the failure directly from Geoffrey Aloysius, the magistrate suggested to consider it after he appears in court on next date.
SDSG Jayasundara also eloborated about acquiring some essential data (swift message copies) stored in PTL's server (computer system).

She said when the investigators attempted to enter into the server with the assistance of an employee of PTL, who was said to have had the user name and password of the system was unable to enter the computer system.

SDSG said that it was found that there was another password protected stage at the entrance of the system.

However, it was revealed that former IT head of PTL Sachith Devathantri who gave evidence at the bond commission against the PTL was aware of that password to enter the system, therefore, acceding the prosecution's request the Magistrate, issued an order on Devathantri and PTL's chairman to assist the CID to acquire required details from the server in the presence of legal representation if necessary.

Meanwhile, at the end of the inquiry, president's counsel Kalinga Indatissa questioned the prosecution on their current progress of the investigation during the last two weeks as the further reports filed recently were nothing to do with the main inquiry.

SDSG Jayasundara responding said that it was a complex and broad inveatigation where the prosecution is eyeing on other potential wrong doings commited by the suspects under the Registered Stock and Securities Ordinance as well.

She explained that the prosecution is also perusing over 10, 000 cheques in expectation of uncovering the PTL's money trading patterns, which is not an easy task by any means.

She also during her submission said that the CID had recorded another statement from a person called Amal Ravindranath, who also confirms the earlier revelation of Rs. 3 million worth cheques received by a Parliamentarian (Sujeewa Senasinghe) from WM Mendis & Companies.

However, the Magistrate considering all the facts of the both parties directed the prosecution to expedite the inquiry as far as possible and re-remanded two suapects, Arjun Aloysius and Kasun Palisena till July 5, 2018.

CA cannot lawfully grant bail on Aloysius, Palisena: ASG Kodagoda

By Shehan Chamika Silva

Additional Solicitor General Yasantha Kodagoda today challenged that it was not lawfully possible for the Court of Appeal to grant bail on Arjun Aloysius and Kasun Palisena due to the manner in which the revision bail application was filed did not invoke appellate jurisdiction of the court.

Apprising the Court, ASG Kodagoda elucidated that initially the Fort Magistrate had refused to grant bail on the suspects (petitioners) on February 16, 2018 during the magisterial inquiry and thereafter, the suspects went to the High Court seeking to revise the magistrate’s order, however, the High Court also refused to entertain the matter on March 9, 2018.

In that backdrop, the petitioners had filed a revision bail application in the Court Appeal and sought to grant bail on Aloysius and Palisena quashing the High Court and Magistrate’s order.

ASG Kodagoda said that it is not possible for the petitioners to get such remedy due to the way in which they had sought those remedies in the revision application.

He said, “firstly the petitioner should have mentioned the exceptional circumstances as to why he could not invoke the appellate jurisdiction, which was available to the petitioner as of right and secondly they should have mentioned the exceptional circumstances that warrants to exercise this extraordinary remedy of rectify the High Court’s order, and thirdly they should have cited exceptional circumstances over the impugned High Court Judge’s exercise”.

In the question of granting bail, according to the ASG, there was a right of appeal under the section 404 of the Criminal Procedure Code for the petitioners, where the Court Appeal can exercise its jurisdiction on granting bail, and the petitioners failed to invoke that in their revision application.

“For the Court of appeal to consider bail under the Section 404, the petitioners could have directly come to the Court after the Magistrate refused to grant bail”, said ASG Kodagoda.

According to the ASG, the maximum the petitioner can lawfully expect is the quashing of that refusal, which would send this mater to the High Court and then that revision application will get activated.

ASG Kodagoda also went onto establish the inter-dependence of the allegations leveled against Arjuna Mahendran, Arjun Aloysius and Kasun Palisena as they have an allegation of abetting to commit each others’ offences which come under both the Public Property Act and the Registered Stock and Securities Ordinance.

ASG Kodagoda’s further submissions will resume on July 4, 2018 before the Court of Appeal Bench comprising Justice Shiran Gunaratne and Prithi Padman Surasena (President).

In the meantime, at the end of the inquiry, when the court was deciding on the next date, President’s Counsel Gamini Marapana who appeared for the suspects moved that they could file further submissions in written form to avoid the delay. 

While saying that he in a sarcastic manner told the ASG “as you have now made submissions to the press”.

At this moment, ASG Kodagoda replied saying “I’m not interested in the press

This is really the most uncalled for and surely for a person in your seniority. And I would say that is a most unacceptable comment”.

However, Mr. Marapana asked again whether submissions could be delivered in a written form and ASG Kodagoda said, ‘no concessions, I’m addressing the court’

Mahendran resides in Singapore: S'pore Police

By Shehan Chamika Silva

ASG Yasantha Kodagoda today informed Court that the Singapore Police had officially informed the CID that former CBSL Governor Arjuna Mahendran is currently residing in Singapore.

In expectation of bringing him down to Sri Lanka, the ASG said all the necessary internal actions are being taken place between the CID and the Singapore Police.

Arjuna Mahendran is the first suspect of the Magisterial inquiry in which he was accused over misappropriating public funds worth Rs. 688 million during the Bond auction held on February 27, 2015.

A parliamentarian received ‘cash cheque’ from PTL related company: ASG Kodagoda

- Court orders for more details of those companies

-   Arjun Aloysius, Kasun Palisena re-remanded till June 7 

By Shehan Chamika Silva 

Additional Solicitor General Yasantha Kodagoda today said a cash cheque of ‘Walt and Row Associates’- a group company of Perpetual Treasuries Ltd, amounting to Rs. 1 million, had been encashed by a security officer of a Parliamentarian. 

The name of the Parliamentarian which was stated in the B report was not revealed in open courts by the Prosecution. 

This was revealed according to a statement given by a police officer to the CID recently, who was attached to the security of the so called Politician.

 

Elaborating on the suspicious nature in which Perpetual Treasuries Ltd had transacted with its group companies (W.M. & Mendis and Walt & Row Associates) to encash cheques which had been ultimately lasted as money to third parties, ASG Kodagoda revealed another encashment of a cash cheque in similar manner. 

ASG Kodagoda said that the investigation had accidentally revealed another similar cheque encashment where an employee of a professional services providing company (Certis Lanka) was interviewed by the CID. 

This cheque was also amounting to Rs. 1 million belonging to W.M. & Mendis- a PTL related group company. 

It was explained that on behalf of W.M. & Mendis this person had encashed the cheque from a reputed Bank and subsequently the money in cash had been handed over to a third party who was seated in the passanger seat of a Defender at the car park of the Bank premises. 

The name of this third party was also not revealed in open proceedings by the ASG.

However, in expectation of perusing on more possible 'money trading' activities of PTL, the prosecution obtained a court order on Certis Lanka to provide details about the services it provided to the PTL and its related companies, W.M. & Mendis and Walt & Row Associates.

At the onset of the inquiry, ASG Kodagoda also sought necessary court orders in relation to certain details of the secondary market transactions of PTL. 

He explained that it was not only about how PTL operated in the Primary Market but also how it dealt within the bond related secondary market. 

It was explained that every primary dealer like PTL had to maintain records about their secondary market dealings in both physical nature (as paper works) and in the scriptless computer system contemporaneously with the Central Bank's computer system (RTGS). 

This computer system that primary dealers operate in relation with secondary market deals is installed and maintained generally by a company called Lanka Finance Services Bureau. 

In view of identifying whether PTL had fed its secondary transactions properly into the CBSL scriptless system (RTGS) via its computer system provided by LFSB, Fort Magistrate Lanka Jayaratne directed LFSB to provide all details relating to secondary market transactions of PTL including ‘SWIFT messages’ from January 2015 to February 2018. 

The Magistrate also directed Geoffrey Aloysius who was the second share holder of PTL to provide all the physical documents that it maintained during all bond transactions to the prosecution. 

In the meantime, Perpetual Treasuries Ltd owner Arjun Aloysius and its CEO Kasun Palisena were ordered to be re-remanded till June 7 by the magistrate over the magisterial inquiry in which they were accused of abetting and conspiring with Arjuna Mahendran to misappropriate public funds worth Rs. 688 million during the Bond auction held on February 27, 2015.

Dayasiri received Rs. 1mn cheque from Aloysius' PTL related company in 2015

By Shehan Chamika Silva

According to a further report (B report) filed into the magisterial inquiry over the Bond scam by the prosecution yesterday, it was revealed that Parliamentarian Dayasiri Jayasekara had received a cheque of Rs. one million from Walt & Row Associates- a Perpetual Treasuries Ltd related group company in 2015.

According to a statement given by a police officer to the CID, who was attached to Mr. Jayasekara’s security in 2015, it was revealed that, on June 13, 2015 Mr. Jayasekara had asked his security officer, Amila Kumara Herath, to encash a cash cheque ( bearing number 566635) which was issued by Walt & Row Associates (under the current account number 0073900773)

According to the statement of Mr. Herath, he then had encashed the cheque from a Kurunegala Bank and subsequently the Mmney ‘in cash’ was handed over to Mr. Jayasekara.

Due to the suspicious nature in which Perpetual Treasuries Ltd had transacted with its group companies (W.M. & Mendis and Walt & Row Associates) to encash cheques which had been ultimately lasted with third parties, the prosecution also obtained a court order to the Chief Executive Officer of Walt & Row Associates to provide details about cheque transactions relating to such nature.

Inland Revenue details of Bond scam suspects can be obtained: Fort Magistrate

By Shehan Chamika Silva

Fort Magistrate Lanka Jayaratne gave an order today with regard to the legal ambiguity that occurred earlier regarding how to seek details from the Inland Revenue Department (IRD) Commissioner under the amended Inland Revenue Act 2014, in order for the prosecution to obtain income related details of the suspects relating to the magisterial inquiry conducted into the Bond scam.

According to Section 42 (relating to the section 209 of the original Act) of the Number 8, 2014 (Amendment) Inland Revenue Act, it states that “if required, in pursuance to an Order issued by a competent Court, the Inspector General of Police, in the course of an investigation which affects to the public interest, can request from Commissioner of the Inland Revenue Department to furnish all information relating to the suspect concerning”.

The Magistrate said for the court to give an order, first of all there should be a written request from the Inspector General of Police or an authorized officer on behalf of him in the court based on which then the Court can issue an order to the IRD.

It was explained that the previous law before the amendment did not allow anyone to peruse such details of any person and that now the prosecution can acquire details from the IRD obtaining a court order after that IGP requests the court to do so concerning the public interest of the inquiry.

Court orders W.M. Mendis & Company CEO for finance details

-PC Kalinga Indatissa observes unfeasibility of bringing down Mahendran under Extradition Law

-Defense files written submissions over PTL representation and legality over requiring assets reports from suspects

-Aloysius and Palisena were re-remanded till May 24

By Shehan Chamika Silva

In the wake of prosecution’s allegation on suspicious money transactions that transpired from Perpetual Treasuries Ltd to one of its group companies, W M. Mendis & Company, the Court today directed Chief Executive Officer of W M. Mendis & Company to furnish a comprehensive report on its finances to the Prosecution.

Fort Magistrate Lanka Jayaratne made this direction based on the request of the prosecution so as to investigate the matter further.

The Prosecution sought the details in form of a report (not a form of a declaration) which is for the sole purpose of the investigation.

In the meantime, the Defense filed their written objections on two matters that occurred earlier as to whether Perpetual Treasuries Ltd should send an independent representative on its behalf for the inquiry instead of allowing either Kasun Palisena (CEO and the 4th suspect) or Arjun Aloysius (de facto owner and 2nd suspect) to appear for the Company which is also the 3rd suspect of the inquiry as well.

The defense also objected to the legality and compliance of the earlier court direction given to the PTL and the two suspects (Aloysius and Palisena) to provide a comprehensive list of their assets in the form of a report to the prosecution.

Subsequently, the Prosecution was also allowed to submit their counter objections in written form on the next day by the Court so as to deliver an appropriate order on the matters concerned.

Meanwhile during the proceedings, President's Counsel Kalinga Indatissa who appeared for the suspects, in a neutral observation, said it was not possible to apply extradition law with regard to former CBSL governor Arjuna Mahendran since that law is only related with convicts and not with suspects.

He observed this when the prosecution contemplated on the possibility of extraditing former CBSL governor Arjuna Mahendran based on Extradition law. He further said that there are other legal mechanisms which can be used by the prosecution since the matter is quite complicated than one would think.

Perpetual Treasuries Ltd owner Arjun Aloysius and its CEO Kasun Palisena were ordered to be re-remanded till May 24 by the magistrate over the magisterial inquiry in which they were accused of abetting and conspiring with Arjuna Mahendran to misappropriate public funds worth Rs. 688 million during the Bond auction held on February 27, 2015.

State Counsel Udara Karunathilake appeared for the state while PC Kalinga Indatissa and Counsel Jeewantha Jayathilake appeared for the suspects.