Besides Deuba, five people, including former Cabinet Minister Prakash Man Singh, also the son of Ganesh Man Singh, the hero of the 1990 Movement that led to restoration of multi-party democracy, were sentenced by the Royal Commission for Corruption Control (RCCC) in the case of awarding of contract for construction of the ADB-funded access road to the Melamchi Drinking Water Project.
Reacting to the verdict, Deuba said "This is a politically motivated case and directed towards assassinating character of political leaders, specially those who opposed the February one Royal takeover."
This is a "conspiracy" to deprive the Kathmandu people from drinking water facility, he charged.
The Melamchi Water Project aims to improve the drinking water supply to Kathmandu which is currently facing a shortage of water.
Deuba and Singh were handed the same two-year prison term and a fine of Rs 5.5 crore each by the commission.
Bhakta Bahadur Koirala, chief of the RCCC, announced the verdict to Deuba, Singh and four others, including a former secretary, after they were found guilty of irregularity in awarding the contract, which the government claimed caused it a loss of about Rs 11 crore.
When asked whether he will appeal against the verdict in the Supreme Court, Deuba said "I will decide it after consulting with the party (Nepali Congress - Democratic)."
Besides Deuba and Singh, former secretary in the Ministry of Physical Planning and Construction Tika Dutta Niraula and chief of the Melamchi Water Project Dhruva Bahadur Shrestha were fined Rs 5.5 crore each and sentenced to two years in prison.
Contractor Jip Tsering Lama and deputy director of the project Dipak Kumar Jha were fined over 2.5 crore each and handed one-year imprisonment.
The RCCC gave the verdict after investigating the case by putting all five of them in police custody for 3 months.
Soon after the announcement of the verdict, about 500 Deuba supporters staged a demonstration in front of the RCCC office here, chanting slogans against it and King Gyanendra, prompting police to resort to baton-charge to disperse them. Two policemen were also injured in the skirmishes.
Former Minister Singh reacted to the verdict, saying "This is not only against the Constitution but also against the natural law to file case, investigate it and give verdict by a single body."
The Royal commission was formed by King Gyanendra to "grill" his political opponents, he alleged, adding, "We will face the case at political level."
The Asian Development Bank, the funding agency, has in a report said that there was no irregularity involved in awarding the contract of the access road.
The RCCC officials, however, said that ADB's report does not affect their verdict.