In a report filed before the high court, the VACB said the offence under sections of the PCA "may not lie" against Jayarajan who had resigned as Industries minister last October last year in the wake of row over appointment of his relative in a public sector undertaking in the industries department.
The VACB had last month given a clean chit to Jayarajan, after which the court stayed the probe against him.
Thereafter a government order was issued on October 13, cancelling the appointment order, the VACB report said.
"... In view of the discussion with the public prosecutor in charge of the case, it may appear that the offence under section 13 (1)(d)of the PC Act may not lie against the accused by taking note of the cancellation of the appointment order and also in view of the fact that the second accused has not assumed charge, it may appear that the second accused has not gained anything," the report said.
The vigilance prosecutor had informed the court that no criminal offence was detected and the case against Jayarajan was going to be closed.
Jayarajan, who was the number two in the cabinet, was accused of appointing his nephew, P K Sudheer Nambiar as Managing Director of Kerala Industrial Enterprises Ltd.
The appointment was later quashed by the government.
Jayarajan, who had successfully contested from Mattannur in northern Kannur district, was a member of the legislative assembly from 1991-96.
His nephew and son of CPI(M) central committee member P K Sreemathy, Sudheer Nambiar is the second accused in the case.
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