IT was was once described as the biggest coup in Scottish legal history, but it has become one of the country's greatest embarrassments.

The case of Abdelbaset Ali Mohmed al Megrahi, the Libyan convicted by Scottish judges of the worst terrorist atrocity on the British mainland, is being returned to the appeal court.

After more than three years of investigation, the Scottish Criminal Cases Review Commission (SCCRC) has concluded that the conviction may have been a miscarriage of justice.

In fact, the commissioners found some six grounds on which to refer the case back to the courts, one of which relates to the non-disclosure of evidence so highly confidential and classified that even Megrahi's defence team has not been shown the documents.

A second relates to the Crown's failure to disclose information relevant to the unreliable status of the key witness against Megrahi. The other grounds for the appeal are based on new evidence and material not led before the court at Camp Zeist.

Megrahi's defence team will use the grounds put by the commission and supplement it with additional information for the forthcoming appeal.

EYEWITNESS IDENTIFICATION
The most compelling evidence to undermine the conviction is that of Anthony Gauci, a Maltese shopkeeper and key Crown witness.

His evidence was accepted by the court, and indeed the appeal court, as identifying Megrahi as the purchaser of items of clothing found at the wreckage site.

Gauci identified Megrahi as the man who bought clothes from his shop in Malta on December 7, 1988, a date when the Libyan was known to have been on the island and, despite the many inconsistencies in Gauci's 19 different statements to the police, the appeal court still accepted him as a credible witness.

The trial court referred to him as an "important witness" and said his identification of the Libyan as the clothes purchaser, "should be treated as a highly important element in this case". Despite his inconsistencies, the appeal court described Gauci "as reliable".

In its 800-page report, however, the commission said additional evidence not made available to the defence indicated that four days before an ID parade at which he picked out Megrahi, Gauci saw a photograph of the Libyan in a magazine article linking him to the bombing.

"In the commission's view, evidence of Mr Gauci's exposure to this photograph in such close proximity to the parade undermines the reliability of his identification of the applicant at that time and at the trial itself," according to the report.

"The commission formed the view that there is no reasonable basis in the trial court's judgment for its conclusion that the purchase of the items took place on December 7, 1988. Although it was proved that the applicant was in Malta on several occasions in December 1988, in terms of the evidence December 7 was the only day on which he would have had the opportunity to purchase the items. The finding as to the date of purchase was therefore important to the trial court's conclusion."

If Megrahi cannot be identified as the buyer of clothes found at the site of the wreckage, the Crown case stutters almost to a halt.

Tony Kelly, Megrahi's solicitor, said yesterday: "It's fatal. If the date is held not to be December 7, 1988, then Megrahi cannot stand convicted of this crime."

In addition to the commission's findings, Megrahi's legal team is expected to focus the forthcoming appeal partly on the grounds that the ways in which Gauci was asked to identify him contradict the official and agreed practices of accurate eyewitness identification.

The defence is expected to introduce US experts and reports which indicate that the way in which Megrahi was shown photographs of men, including the accused, increased the likelihood of a false identification.

When in 1989, 1990, and 1991, he was shown different photospreads of suspects, he should have been handed pictures sequentially and not simultaneously, according to the experts.

According to them, the police officers running the ID line-up in which Megrahi was identified should not have known the identity of the suspect - the opposite of what happened at the time.

Elizabeth Loftus, professor of law and psychology at the University of California Irvine, an expert in eyewitness identification, was commissioned by Mr Kelly to research Gauci's identification of his client.

She told The Herald that the commission had made the right decision to allow an appeal because a number of key errors were made in the investigation, including that Gauci was interviewed nine months after the suitcase was purchased. In one study she cites as an example, shopkeepers had significant difficulty in describing customers from only a day earlier.

Gauci's description of Megrahi also altered dramatically over time from his initial account. Ms Loftus said: "His memory changed and shifted in the direction of matching the defendant. He started with someone more like 50 years old and 6ft tall.

"He shifted his memory so that the person conformed more to the description of the current suspect. Testimony that was very vague and unsupportive suddenly got changed to match the date. Memories of whether it was raining or not changed to match that date, and all of a sudden Christmas lights sprang up." One recommendation Ms Loftus made was against showing mugshots all together, as happened with Gauci. "Research seems to suggest that when you show these photos one at a time, rather than simultaneously, you have a better chance of reducing the chances of false identification." Evidence seen by The Herald reveals that Gauci's statements were not only inconsistent, a fact raised at the initial appeal, but that he was led to say specific things.

His statement from February 15, 1991 reads: "I looked at every photograph on the card and I counted a total of 123 The first impression I had was that all of the photographs were of men younger than the man who bought the clothing.

"I told Mr Bell (Harry Bell, former DCI on the Lockerbie case) this. I was asked to look at all of the photographs carefully and to try to allow for any age difference.

"I would say that the photograph at number eight is similar to the man who bought the clothing. His hair is perhaps a bit longer. The eyebrows are the same, the nose is the same, and his chin and shape of face is the same.

"The man in photograph number eight is, in my opinion, 30 years, he would perhaps have to look about 10 years or more older and he would look like the man who bought the clothes. It has been a long time now and I can only say that his photograph resembles the man who bought the clothing, but is younger. Mr Bell wrote down a statement for me. I can only say that of all the photographs I have been shown, this photograph number eight is the only one really similar to the man who bought the clothing if he was a bit older."

FRESH EVIDENCE
The commission's report refers to new evidence not heard at the trial in relation to the date on which the Christmas lights were put up near Mary's House, Gauci's shop in Sliema, Malta.

Crucial to the prosecution case was that Megrahi made the purchase from the shop on December 7. He also stated that the lights were not up on that day - but new evidence suggests they had been lit the day before. The commission states: "This additional evidence indicates that the purchase of the items took place prior to December 6, 1988. In other words, it indicates that the purchase took place at a time when there was no evidence at trial that the applicant was in Malta."

Gauci's early statements refer to the fact that he remembered the date of the purchase as being a couple of weeks before Christmas, before the lights were put up.

However, in a statement taken from him in 1989 and seen by The Herald, he said: "At Christmas time, we put up the decorations about 15 days before Christmas, the decorations were not up when the man bought the clothing."

Gauci thought the end of November was the likely date but this was never put before the court.

NON-DISCLOSURE OF EVIDENCE
The commission states that "other evidence", not made available to the defence, could in their view "undermine" Gauci's identification of Megrahi as the purchaser.

One of the grounds of referral is so sensitive and highly classified that the documents have still not been handed to the defence team. A number of appeals have been launched and won in Scotland in the past two years on the grounds of non-disclosure.

The fact that Colin Boyd, the then Lord Advocate, failed fully to disclose crucial CIA documents to the defence is also expected to factor in the appeal court hearing. Some of the edited statements were presented to the court but, without full disclosure, it is impossible for the defence to know what is missing.

NEW POLICE FILES
Files found in Germany and held by the BKA police, and documents found in Malta, reveal major discrepancies in the police documents which were shared between different forces at the time.

While the commission ruled out allegations that officers had "doctored" or falsified documents, the non-disclosure of statements is another factor.

Detective Constable John Crawford, who was involved in interviewing Megrahi, consistently maintained to the defence that the clothes were purchased in December 1988 - a date which coincided with when the Crown knew Megrahi was in Malta.

However, in a file found at the BKA dated 6/12/89, he said: "He Gauci was unable to identify any of the men shown in the photographs as being the man who bought the clothing from his shop in November 1988."

A further statement by DCI Harry Bell, found only in the BKA files, referred to the purchase being in November.

Gauci, according to the German files, referred to Megrahi entering his shop in November or December. He also referred to seeing the "same" man on other occasions, including in Tony's bar on Malta.

EVIDENCE NOT LED
It is thought the commission's investigations also uncovered new documents pertaining to the alleged payments made by Iran for the bombing. Until 1990, the main suspect in the case was Abu Talb, a member of the Popular Front for the Liberation of Palestine General Command, which was allegedly funded by Iran, to conduct the Lockerbie bombing. A partially edited US Defence Intelligence Agency cable, dated September 24, 1989, states: "The bombing of the PanAm flight was conceived, authorised, and financed by Ali-Akbar (Mohtashemi-Pur), the former Iranian Minister of Interior. The execution of the operation was contracted to Ahmad (Jibril), Popular Front for the Liberation of Palestine General Command (PFLP-GC) leader, for a sum of $1m. One hundred thousand dollars of this money was given to Jibril up front in Damascus, by the Iranian Ambassador to Sy (Syria), Muhammad Hussan (Akhari) for initial expenses. The remainder of the money was to be paid after successful completion of the mission."

Another partial DIA cable, dated February 12, 1991, stated that Ayatollah Motashemi, a member of the Iranian government, had paid $10m in cash and gold to the Al Abas and Abu Nidal terrorist groups to carry out terrorist activities.

FORENSICS TRAIL
The forensic evidence showed that the Lockerbie cassette-bomb had been wrapped, inside its suitcase, in clothes with Maltese tags.

In May 1989, the Scottish police found clothing bought in Malta in the German flat of Abu Talb, the original suspect who is currently serving a life sentence in Sweden for bombing a synagogue in Denmark in 1985. Talb was known to have visited Malta some weeks before the bombing.

Much of the evidence points to Talb rather than Megrahi, and the defence team has claimed the entire forensics trail will "unravel" on appeal.

LIBYA TAKING THE BLAME
The commission also took into account a letter by Libya to the UN Security Council in 2003 accepting "responsibility for the actions of its officials" in the "Lockerbie incident".

Their report states: "As the commission did not view the letter as amounting to confirmation by Libya of the applicant's guilt, it did not believe that its terms justified refusing his case." The commission said it applied an interests-of-justice test. This included the commission considering statements Megrahi gave his legal team before the trial, and statements he gave the commission.

The report states: "Although there were a number of inconsistencies and contradictions in these accounts, the commission did not consider the contents of these statements justified the refusal of the case in the interests of justice."