Kathmandu — The Central Investigation Bureau (CIB) of Nepal Police has arrested Jyoti Prakash Pandey, Chief Executive Officer of Nepal Investment Mega Bank, in connection with the alleged illegal auction of assets belonging to Smart Cell. He was taken into custody at around 8:00 PM on Tuesday.

Smart Cell had received a license from the Nepal Telecommunications Authority on April 15, 2013, to operate telecommunications services in Nepal. However, the company failed to renew its operating license in accordance with legal provisions. Under Nepali law, a telecommunications license is automatically canceled if it is not renewed within the prescribed period.

According to Rule 18 of the Telecommunication Service Provider Asset Management Regulation 2079, all assets, telecommunications infrastructure, systems, structures, and networks of the company were required to remain under the control of the Nepal Telecommunications Authority following the cancellation of the license.

Investigators allege that despite the assets being under government control, they were unlawfully auctioned with the intention of depriving the government of its legal ownership rights. Authorities have accused those involved of fraud and criminal breach of trust under the National Penal Code 2017.

The CIB stated that Pandey was directly involved in the auction process in his role as chairman of the loan recovery committee. He has been arrested on charges related to fraud and criminal breach of trust for allegedly facilitating actions intended to undermine the government’s ownership over public assets.

The bureau further stated that Smart Telecom, which had operated under a basic telephone service license issued by the Nepal Telecommunications Authority, automatically lost its license under Section 25(5) of the Telecommunications Act 2053 after failing to renew it as required by law.

In addition, the investigation found that while publishing the auction notice, Nepal Investment Mega Bank had required bidders to submit a lump-sum offer of Rs 400 million, which included outstanding house rent and electricity dues payable by Smart Cell to landlords where telecommunications equipment had been installed.

However, according to CIB spokesperson Senior Superintendent of Police Shiva Kumar Shrestha, although the bank collected the amount, it has allegedly failed to pay the landlords and clear the electricity dues. Authorities claim this also amounts to fraud and criminal breach of trust under the National Penal Code 2017.