The Congress-led Opposition walked out of the Kerala Assembly on Tuesday demanding an enquiry into alleged corruption in allowing sale of paper lotteries from outside the State.

Participating in the debate on the Kerala Appropriation (No. 2) Bill, the Opposition members alleged irregularities in accepting tax for sale of lotteries from distributors related to mega distributor Santiago Martin. The distributors were not direct agents of Sikkim or Bhutan governments as claimed, and the CPI (M) was receiving commissions for allowing the sales, they alleged.

Finance Minister T. M. Thomas Isaac, who replied to the debate, said that the Opposition was raising baseless allegations and demanding enquiry with a view to the forthcoming elections to the local self government institutions. Opposition Leader Oommen Chandy taunted him asking why the government was afraid of an enquiry if there was no irregularity.

The Minister said that the government could not avoid accepting tax because the Supreme Court had restrained the State from indirectly stopping sale of lottery tickets. The State government did not have the power to ban the sale of lotteries run by other State governments though their conduct had been found to in violation of Central Lotteries Act. The Supreme Court had nullified orders of the State government cancelling registration of mega lottery distributors.

Dr. Isaac said that the Centre had brought rules that contravened the provisions of the Act. The rules permitted conduct of even 24 draws a day. The rules were hurried through after P. Chidambaram became the Union Home Minister. His wife Nalini Chidambaram was the counsel of the lottery agencies in the cases against Kerala government. So, the Opposition should be asking what commissions they had got. Mr. Chidambaram should not have played any role in bringing the rules considering his wife’s involvement in the matter.

Referring to the Opposition allegation that the government had appointed an advocate who had represented the lottery agents in the past as government pleader to argue lottery-related cases before the High Court, the Minister said that the pleader had won the case entrusted to him. The cases he had lost were all related and were all dismissed in the light of a Supreme Court order.

He said that developmental expenditure by the government had increased substantially. Some budgeted expenditure for the past three years were seen as not having spent since the government could make savings on repayments of loans. The government had not taken any ways and means advances so far this year, and that would translate into increased savings.

He recalled that the Accountant General had observed that the State was moving towards debt stabilisation. The debts were only 32 per cent of the State Gross Domestic Product against 41 per cent at the end of the UDF rule. The UDF had only provided Rs. 24 crore for supplying rice at Rs. 3 a kg to the poor while the present government would be spending Rs. 600 to Rs. 700 crore this year to supply rice at Rs. 2 a kg.

After the Minister’s reply, the House passed the Bill in the absence of the Opposition.