Yielding to rising pressure, Lal Thanzara, the health minister of Mizoram, on Tuesday resigned from both the state’s assembly and council of ministers.
The minister, who is the younger brother of Mizoram Chief Minister Lal Thanhawla, faces two conflict of interest cases.
As Scroll.in reported in June, between 2009 and 2012, Lal Thanzara owned shares in a road construction company that was getting government contracts – Sunshine Overseas.
The transaction raised questions. When Lal Thanzara acquired 21% shares in Sunshine Overseas Private Ltd, it created a situation in which Chief Minister Lal Thanhawla’s government was giving road contracts to a company part-owned by his brother. During the three years that Lal Thanzara held the shares, the company’s profits rose from Rs 8.5 lakhs to Rs 96 lakhs.
Over the last month, the contracts created some pressure on the state government. As local transparency NGOs like Prism planned legal action and opposition parties like the Mizo National Front picked up the issue, Lal Thanzara initially stayed quiet. He did not respond to Scroll.in’s questions either.
However, late last week, he finally broke his silence to say he did not know he held shares in the company until the Scroll.in article was published. The Indian Express quoted him as saying: “I only knew I held shares in the company after I was accused of having them. I did not receive even a naya [paisa].”
But this defence only raised more questions than answers. For instance, how could anyone get shares without applying with a share application form?
By Tuesday morning, things had reached a climax of sorts.
First, Laltanpuia Pachuau, a Mizo activist, sent an email to Chief Election Commissioner Nasim Zaidi lodging a formal complaint about the violation of the Representation of People’s Act, 1951, by Lal Thanzara.
The email, of which Scroll.in has a copy, refers to two conflict of interest transactions. Apart from the Sunshine matter, it refers to another company owned by Lal Thanzara – HP Food Products.
On November 26, 2014, responding to a question in the Mizoram assembly, the state government had admitted that HP Food Products had supplied high-protein biscuits to the state government between 2010 and 2014. To reduce conflicts of interest, India’s Representation of People’s Act, 1951, forbids elected representatives from entering into trade- or business-related contracts with the government while they are MLAs or MPs. The biscuit deal violates this clause.
Later on Tuesday, at 12.30 pm, the Mizo National Youth Front, the youth wing of the opposition Mizo National Front, was planning to hold a press conference to challenge Lal Thanzara’s defence and to make public documents about his shareholding in Sunshine.
But a little before that, around noon, Lal Thanzara submitted his resignation to Lal Thanhawla and the state speaker. In his resignation letter, he denied any wrongdoing.
According to the Indian Express, while telling Congress workers about his decision, Lal Thanzara said he had resigned because the party risked being embarrassed over the allegations that his brother gave several contracts to a firm he held shares in at the time.
It’s not clear what will happen next. According to K Vanlalvena, the president of the Mizo National Youth Front, while Lal Thanhawla has accepted his brother’s resignation, the speaker is yet to do so since he is travelling.
The road ahead
According to Zodin Sanga, one of the founders of Prism, the transparency NGO will proceed with the court case as planned. It’s yet unclear if the resignation will defang the Mizo National Front offensive or if it will keep the heat on Lal Thanhawla, who was responsible for awarding the contracts to Sunshine.
Even today, the chief minister holds the additional charge of the Public Works Department portfolio. And, as the Mizoram government’s website says (it is yet to be changed after the resignation), one of Lal Thanzara’s responsibilities as Minister of State was to “assist the Chief Minister in PWD & P&E [power and electricity] Department.”
This means he was dealing, on behalf of the government, with a company in which he used to have shares.
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