CIAA Supreme Court Appeal: National Payment Gateway (NPG) Corruption Case Verdict Challenged in Nepal
9th May 2025, Kathmandu
The Commission for the Investigation of Abuse of Authority (CIAA) has filed an appeal with the Supreme Court. The appeal challenges the Special Court’s decision in the corruption case related to the National Payment Gateway (NPG) procurement.
CIAA Supreme Court Appeal
The CIAA claims that the Special Court’s verdict was flawed, especially regarding the leniency shown in sentencing the accused.
Background of the Case
The case revolves around corruption and irregularities in the procurement of the National Payment Gateway system, a project run by the National Information Technology Center (NITC) under the Ministry of Information and Communication Technology. The system was meant to facilitate electronic payments for domestic and international transactions.
The accused individuals allegedly violated procurement laws, bypassed necessary processes, and misused public funds. The CIAA claims the accused were involved in misappropriating funds and bypassing legal procedures, including failing to coordinate with necessary stakeholders, not preparing proper documentation, and exceeding the allocated budget.
Allegations Against the Accused
The CIAA accuses the defendants of the following:
Budget Irregularities: The procurement process exceeded the approved budget by Rs. 25 crore without proper budget requests or documentation. The CIAA claims that no budget was prepared by the NITC for the procurement, and the budget allocation was done without proper justification.
Failure to Follow Legal Procedures: The CIAA claims the procurement violated the Public Procurement Act. There was no procurement plan, no approval from relevant authorities, and no coordination with other agencies. Additionally, the CIAA argues that the procurement process was presented as purely technical but had significant banking and legal implications.
False Reporting and Misuse of Funds: According to the CIAA, false information was provided to approve the tender. Consultants submitted invoices for incomplete or unverified work, and payments were made without proper documentation or approvals.
Non-Operational System: Despite the funds being allocated, the National Payment Gateway System was never operational. Reports suggest that the system remains non-functional, with no clear indication that it will be functional in the future.
Individuals Named in the Case
The CIAA has filed charges against several key individuals, including:
Sanjay Sharma – Former Secretary
Pranita Upadhyaya – Former Secretary
Madhukumar Marasini – Former Secretary
Sunil Paudel – Managing Director of Nepal Telecom
Ram Bahadur Budha – Former Secretary
Ramesh Prasad Pokhrel (Ramesh Pokhrel)
Ram Sharan Ghayak – Former Director
Safal Shrestha – Former Director
Nim Bahadur Wali – Former Director
The CIAA claims that even though substantial evidence of corruption was presented, the Special Court acquitted several accused individuals, a decision the CIAA deems unjust.
Special Court’s Verdict
On April 25, 2024, the Special Court issued its ruling. Sunil Paudel was sentenced to nine years in prison and fined Rs. 23.27 crore. However, several other individuals were acquitted, including Madhukumar Marasini, Ram Bahadur Budha, Ramesh Pokhrel, Ram Sharan Ghayak, Safal Shrestha, and Nim Bahadur Wali.
The CIAA argues that the Special Court’s ruling was flawed because the punishment was insufficient and several guilty individuals were cleared of all charges. The CIAA insists that the court did not take into account the full scope of the corruption.
Financial Impact of the Corruption
The alleged corruption resulted in a loss of Rs. 23.27 crore. The CIAA claims the procurement process involved misreporting, false documentation, and failure to fulfill obligations, all of which led to a significant financial loss for the state.
The CIAA has demanded that the individuals involved in this case repay the amount lost due to their actions and be held accountable under the Corruption Prevention Act.
Procurement Process and Its Failures
The National Payment Gateway system was meant to enable seamless electronic transactions. However, the CIAA claims that the project was mismanaged from the beginning. Despite being presented as a technical project, it required significant banking and legal coordination, which was never carried out properly.
The procurement process lacked proper planning, and the necessary approvals from relevant authorities were not obtained. The CIAA claims this failure contributed to the project’s inability to become operational and resulted in financial losses.
Ongoing Investigations and Appeals
The CIAA’s appeal against the Special Court’s verdict is one of many actions the commission has taken in response to corruption and mismanagement in public projects. The CIAA is also appealing in other cases involving financial irregularities, such as the solar light installation scam in Vishnupur, where Rs. 5 lakh was misappropriated.
In addition, the CIAA has filed a case against Pramod Niroula, an accountant at the Foreign Employment Department, who allegedly demanded a bribe of Rs. 15,000 to return a service user’s security deposit. Furthermore, the CIAA has taken action against Suman Khanal, an engineer at the National Housing Company, who allegedly submitted fake certificates to secure employment.
Conclusion
The CIAA’s appeal is an important step toward accountability and transparency in government projects. The National Payment Gateway procurement case highlights serious issues with corruption and mismanagement in public procurement processes. The Supreme Court’s decision will play a key role in determining whether justice is served in this high-profile case and will have implications for similar cases in the future.
For more: CIAA Supreme Court Appeal
