Lim Hock Seng said this was stated in the terms of a contract between the state government and Consortium Zenith BUCG Sdn Bhd for work on the tunnel and three accompanying roads.
Under the contract, the Penang government was to pay Consortium Zenith with two plots of land, Lot 702 and Lot 10012 in Seksyen 1, Bandar Tanjong Pinang, valued at RM208.76 million.
“We wanted to solve Penang’s traffic woes for good through this tunnel-and-roads project.
“We complied with all the laws in getting a contractor for the job,” Hock Seng said.
The prosecution, however, has contended that Guan Eng dishonestly misappropriated two plots of state land between Feb 17, 2015 and March 22, 2017 by transferring their ownership to two companies linked to Consortium Zenith.
He was slapped with two charges under Section 403 of the Penal Code. If found guilty, Guan Eng may face a jail term of between six months and five years, as well as a fine and whipping.
Besides misappropriating the state’s land, Guan Eng is accused of using his position as then chief minister to ask Consortium Zenith senior director Zarul Ahmad Mohd Zulkifli for a 10% cut of the profits, which would be made from the tunnel-and-roads project.
The former finance minister is also accused of seeking RM3.3 million in kickbacks to appoint Zarul’s company to undertake the project.
Hock Seng also told the court that the state government had appointed an engineering firm (HSS Integrated Sdn Bhd) to check on how much Consortium Zenith should be paid for the tunnel-and-roads project.
“Initially, they charged RM20 million in consultancy fees but the chief minister (Guan Eng) asked them to reduce it,” he said, adding that the firm’s appointment was done through an open tender.
It was reported that HSS Integrated advised the state government to pay RM208 million to contractor Zenith Construction for an environmental study. The firm was paid RM11.2 million for this consultancy work.
HSS Integrated was also the company that oversaw the tender process for the tunnel-and-roads project, together with the State Tenders’ Committee, chaired by the state secretary.
Besides the tunnel-and-roads project, HSS Integrated was also involved in the East Coast Rail Link (ECRL) project.
The hearing continues on Aug 16 before Judge Azura Alwi.