Auditor General rejects settlement for Dheebaja

Auditor General Hassan Ziyath, on Wednesday, refuted the out-of-court settlement of MVR 174 million with Dheebaja Investment Pvt Ltd.

The state contracted Dheebaja to provide ferry services in the Northern Province in 2011, during the presidency of former President Mohamed Nasheed.

However, after the administration of former president Dr Mohamed Waheed terminated the contract in 2013, Dheebaja filed a lawsuit and won, with the Civil Court ordering the government to pay MVR 348 million to the company as compensation. The Supreme Court upheld the verdict last year.

A request was then filed by the Attorney General's Office at the apex court, earlier in 2020, to review the court's decision upon request by incumbent President Ibrahim Mohamed Solih.

Prior to that, the Attorney General's Office's Settlement Committee initiated discussions with the company and reached an out-of-court settlement of MVR 174 million.

According to the audit report, the contract was terminated by the state after Dheebaja breached the agreement, deeming the company as negligent in carrying out their tasks. Thus, the audit report concluded that there was no call for the state to make the settlement to Dheebaja.

The Auditor General’s Office also noted that Dheebaja stood to receive 15 hectares of land from uninhabited island Kudakurath in Raa Atoll, to develop a tourist resort on the island to incentivise the subsidisation of ferry services. However, Dheebaja was awarded 37.6 hectors, including the lagoon area of Kudakurath, under the lease agreement signed on May 5, 2010.

Under the contract, the state retained the ability to reacquire the island following the nullification of the contract.

The Auditor General's Office further raised concerns over possible corruption and illicit enrichment as the state had awarded over double the declared land area to Dheebaja.

Following delays in payments as a result of the then-ongoing probe by the Parliamentary Committee on Public Accounts, the Committee alleged that certain backdoor proceedings were held in relation to the state moving to award damages to Dheebaja.

The Committee then moved to file the case at both the Anti Corruption Commission, as well as the Auditor General's Office.

Having filed the case for review at the Supreme Court, the Auditor General's Office had noted that delays were further caused by corruption allegations against the court.

Under the Solih-administration, the Supreme Court bench was replaced by new Justices.