Three suspects, including former President’s Chief of Staff, Gamini Sedara Senarath were yesterday ordered to be further remanded till November 21 by Colombo Fort Magistrate.
This is for allegedly misusing public funds by illegally investing Rs.4 billion from the Rs.18.5 billion approved by the Cabinet for a hotel project in 2012.
Three suspects Gamini Senarath, former Sri Lanka Insurance Corporation Managing Director Piyadasa Kudabalage and former Samurdhi Commissioner Neil Bandara Hapuwinna were produced before Court by prison authorities.
Defence Counsel appearing on behalf of Gamini Senerath and Niel Bandara Hapuwinna yesterday tendered their written submissions seeking bail on behalf of the suspects when the matter came up before Magistrate Lanka Jayaratne. However, defence counsel appearing on behalf of Piyadasa Kudabalage told Court that the written submissions on behalf of his client will be filed in due course.
The Magistrate announced that she would make an appropriate order on the next inquiry date after inspecting both legal and incidental material relevant to the case.
According to a B report filed before the Colombo Fort Magistrate’s Court, they have been accused of misusing government funds by illegally investing Rs.4 billion from the Rs.18.5 billion approved by the Cabinet in 2012.
The funds in question had been the allocation for the Kollupitiya Grand Hyatt Regency Hotel, to be constructed by Canwill Holdings Ltd, a company affiliated to the Sri Lanka Insurance Corporation, but had been invested in the Hambantota Hyatt Regency Hotel project.
It is revealed that Canwill Holdings formed two subsidiaries, Sinolanka Hotel and Spa, which was implementing the Hyatt hotel project in Kollupitiya and Helanco Hotels and Spa to carry out the proposed Hyatt hotel in Hambantota.
The re-construction work of the partly build Celestial Residencies building of the failed Ceylinco was then transformed, during the past three years, to build the Hyatt hotel in Colombo. The main land was leased for 99 years from the Urban Development Authority (UDA) after the former Ceylinco property was expropriated by the previous government in 2011 in terms of the provisions in the Revival of Underperforming Enterprises and Underutilised Assets Act No.43 of 2011.
The prosecution maintained that Canwill Holdings is a state-owned public enterprise, set up during former regime, with Rs.18.5 billion in equity, secured from its major shareholders, Sri Lanka Insurance Corporation, which has invested Rs. 8.5 billion, and Litro Gas and the Employees Provident Fund (EPF) with Rs. 5 billion each.
President’s Counsel Ali Sabry, Anil Silva PC and Counsel Nalinda Indatissa appearing for the suspects had argued that the suspects cannot be charged under Public Property Act citing that the Canwill Holdings is not a state institution.
‘Sri Lanka Insurance Corporation is a company registered under the Companies Act. Money were invested on a contract by several parties, including Canwill Holdings, EPF and Litro gas Lanka company. No offence has been disclosed against the suspects,’ Mr. Ali Sabry added.
At a previous occasion, Deputy Solicitor General Thusith Mudalige ,appearing on behalf of the FCID, denied the claims made by defence that the Sri Lanka Insurance Corporation is not a state institution. He stated that the company named Canwill Holdings had been formed by first suspect, in his personnel capacity and he is a shareholder of the company.
On November 9, the three suspects appeared before Court as per an undertaking given to the Supreme Court. However, at that time the defence counsel appearing on behalf of the suspects told Court that their clients were not surrendering to Court, but merely appearing for the purpose of making a statement to the FCID.
Senarath and two others had filed three Fundamental Rights petition in the Supreme Court seeking an order preventing the FCID from arresting them n connection with a magisterial inquiry, under the Public Property Act and Prevention of Money Laundering Act.
This petition is to be taken up for support on November 17.
President’s Counsel Ali Sabry with Anil Silva PC, Sampath Mendis and Counsel Nalinda Indatissa appeared for the suspects. Chief Inspector Anura Premaratne appeared for the FCID.
The suspects Gamini Senarath, former Sri Lanka Insurance Corporation Managing Director Piyadasa Kudabalage and former Samurdhi Commissioner Neil Bandara Hapuwinna leaving the court.