The case will be heard afresh from June 1.
Judge N R Channakeshava gave the relief after the prosecution, during cross examination of Chandy, failed to establish that the defendant had made changes to the affidavit which it had received.
On January 2, the complainant in the case, case city- based businessman M K Kuruvilla, had sought time to study the affidavit, alleging it was different from the copy he had received.
Chandy had filed two applications appealing against the earlier verdict.
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The first had challenged the court'sex-parte order and the second sought that his arguments beheard.
On January 10, the court completed the cross-examination of Chandy after he had replied to several queries.
Kuruvilla had filed a civil petition in 2015 seeking return of Rs 1,60,85,700 deposited with SCOSSA Educational Consultants Private Limited for setting up a solar power project in Kerala.
The petitioner had said that Nair had approached him for setting up the solar power project.
The petition stated that Nair had claimed that one of thedirectors of SCOSSA, Andrews, was Chandy's first cousin andwould be appointed consultant to the project and that he would operate from Abu Dhabi.
Kuruvilla had also submitted that Nair had named one Diljith as another director of SCOSSA who, he claimed, was the private secretary to Chandy and contended that the former Chief Minister too was jointly liable to return his money.