What is next in the treasury bond case after Supreme Court verdict?

Colombo, June 3 (Daily Mirror) - The Supreme Court's landmark ruling on Monday (1), which set aside a High Court-at-Bar order discharging several accused, including Perpetual Treasuries Ltd. and former Central Bank Governor Arjuna Mahendran, from charges relating to the controversial Central Bank Treasury bond issuance case, has reignited public interest in one of the country's most high-profile financial case. The Supreme Court's determination that a company can be prosecuted under the Offences Against Public Property Act has also raised concerns about the future course of the case and its implications for the accused. In response to these concerns, the Daily Mirror examines what the ruling means, the legal steps that are likely to follow, and the challenges that may arise as the case moves forward.

Public Property charges

The Attorney General is expected to proceed with Public Property Act charges against the accused in the controversial Central Bank bond scam case following a landmark Supreme Court ruling delivered on Monday (01) that allows Perpetual Treasuries Ltd (PTL) to be prosecuted under the Offences Against Public Property Act. The ruling relates to the controversial Treasury bond auction conducted on March 31, 2016.

The Supreme Court overturned an earlier determination by the High Court-at-Bar, which had held that Public Property Act charges could not be maintained against PTL as a corporate entity and, consequently, that its directors could not be indicted for aiding and abetting the company in relation to such offences.

In its judgment, the Supreme Court held that a company can, in fact, be prosecuted under the Offences Against Public Property Act. The Court observed that while a corporate entity cannot be subjected to imprisonment, it can nevertheless be punished through the imposition of fines where the relevant law provides for such penalties.

The Supreme Court further found that the High Court-at-Bar had erred in law in concluding that PTL could not be indicted under the Public Property Act.

Trial-at-Bar proceedings to resume

With the Supreme Court's ruling, the long-delayed Trial-at-Bar proceedings concerning the March 31, 2016 bond issuance are expected to resume.

The case had previously been heard before a three-member Trial-at-Bar. However, legal observers note that practical difficulties may arise in reconstituting the original bench. In such circumstances, the Attorney General may request the Chief Justice to appoint a new Trial-at-Bar to hear the case.

Under the law, the Chief Justice has the authority to nominate a three-judge bench to hear matters of exceptional public importance, taking into account the circumstances surrounding the alleged offences.

Duration of trial remains uncertain

Legal experts say it is difficult to estimate how long the proceedings may take, as the duration of a criminal trial depends on numerous factors, including the complexity of the case and the volume of evidence.

Where the prosecution and defence call a large number of witnesses, proceedings could extend over a considerable period. The trial could also face delays if legal objections are raised or if either party challenges procedural or substantive issues before appellate courts through appeals or revision applications.

Daily hearings expected

The Supreme Court, in its judgment, also reminded High Court-at-Bar judges that such trials should ordinarily be conducted on a day-to-day basis unless exceptional circumstances justify postponements.

Section 450(5)(b) of the Code of Criminal Procedure Act requires that Trial-at-Bar proceedings be heard continuously to ensure their expeditious disposal. The provision specifically states that the unavailability of a particular attorney-at-law, including engagements in other courts or tribunals, should not be regarded as an exceptional circumstance warranting a postponement.

The frequency and duration of daily hearings, however, will ultimately depend on the circumstances of the case and the availability of the court.

Challenges for defence counsel

The statutory requirement for day-to-day hearings may create practical challenges for the accused in retaining legal representation of their choice.

Senior counsel who handle multiple high-profile matters in different courts may find it difficult to dedicate continuous time to a lengthy Trial-at-Bar proceeding. As a result, accused persons could face constraints in securing the regular appearance of their preferred lawyers throughout the trial.

Potential penalties

Under Section 5(1) of the Offences Against Public Property Act, any person found guilty of dishonestly misappropriating movable public property or committing criminal breach of trust involving public property is liable to imprisonment ranging from one year to 20 years, in addition to a fine.

Case background

The Attorney General has filed indictments against Perpetual Treasuries (Pvt) Ltd, former Finance Minister Ravi Karunanayake, former Central Bank Governor Arjuna Mahendran, PTL beneficial owner Arjun Aloysius, PTL Chief Dealer Kasun Palisena, PTL Chairman Jeffrey Joseph Aloysius, Chitta Ranjan Hulugalle, Muthuraja Surendran, Ajahn Gardiye Punchihewa, and Badugoda Hewa Indika Saman Kumara over their alleged involvement in the March 31, 2016 Treasury bond auction.

The Attorney General had alleged that the Perpetual Treasuries limited is using the Central Bank's important undisclosed information to artificially alter the final outcome of the Treasury bond auction, as it has had a huge impact on the overall national economy as a result of the subtle and systematic conduct of the offenses related to this fraud and has caused injustice to other primary sellers in the bond market and the PTL has acted cunningly and made a huge profit and conspired to cause a huge loss to the government.