Even as the Central Bureau of Investigation began an inquiry into allegations of bribery in the Rs. 3,600-crore deal with AgustaWestland U.K. for procuring 12 VVIP choppers, India on Friday sought to scrap the pact that has been marred by charges that kickbacks worth Rs. 362 crore were paid by Italian parent company Finmeccanica to bag the contract.
The Defence Ministry issued a show-cause notice to AgustaWestland, asking it to explain within a week the bribery allegations, Ministry spokesman Sitanshu Kar said on Friday. The notice asked the company why the deal, signed in February 2010, should not be scrapped.
“The Defence Ministry issued a formal show-cause to AgustaWestland, seeking the cancellation of the contract and taking other actions as per terms of the contract,’’ the spokesman said.
On Thursday, the Ministry warned of strict legal action, including invoking the integrity pact that provides for cancellation of the contract if bribes are paid and recovery of the money paid.
Noting that there were reports in Italy on investigation in to the alleged scam in the deal and Finmeccanica CEO Giuseppe Orsi being arrested in Milan on Tuesday, India had made a fresh request for information in the matter, sources in the government here said.
(A similar request was made by India in the recent past and Italy’s stand was that its judiciary was independent and was pursuing the probe.)
Report’s copy sought
The sources said the Indian mission in Rome was requested to make a formal application to the court authorities to get an authenticated copy of the preliminary report of the Italian prosecutors that had levelled allegations of payoffs to agents and middlemen that reportedly helped the Italian defence giant to swing the deal in its favour.
The Defence Ministry also asked AgustaWestland to state whether any money was illegally paid to any Indian entity or individual.
India has received three of the 12 helicopters and paid up to 30 per cent of the amount but suspended further payments and put on hold the delivery of the remaining choppers.
Reports appeared in October-November 2012, alleging that Finmeccanica had clinched contracts in four countries due to the contacts of the former Premier, Silvio Berlusconi, and his most trusted aides such as the former Minister and People of Freedom party coordinator, Claudio Scajola.
The reports quoted statements of Lorenzo Borgogni, former director of Institutional Relations at Finmeccanica, made to investigating magistrates Vincenzo Piscitelli and Henry Jon Woodcock, which revealed “underhand dealings’’ behind international orders in India, Panama, Indonesia and Russia.
Keywords: VVIP chopper deal, AgustaWestland, Defence Ministry, Finmeccanica, Giuseppe Orsi
If the government tries to annul the contract based on payment of
bribes to decision makers by the supplier of the helicopters, the
supplier will definitely take the matter to the court in the
purchaser's country as any such contract will specify and in the
hearing of the case much dirty linen will be washed in public.
Therefore it is difficult to believe that the contract for the
purchase of helicopters will be cancelled. Well, all problems can be
solved if the investigating agency "fail" to find any "legally
acceptable proof" of any Indian having accepted a bribe! The
government will of course be knowing this. Let us wait and watch.
Better late than never! It took Italian prosecutors to take action against an Italian company for Indian govt to initiate an inquiry against foreign firm and this inquiry in all likelihood would receive a quiet burial like the previous all scams. Shame on this govt and its hypocritical crocodile tears for the poor while looting the country all along!
Look at how inefficient Antony is - what happened in the Tatra trucks
scam case? NOTHING! The evidence was there. It was also so clear that
former MGO Lt Gen VK Jetley awarded contracts through his own brother
(just like Tyagi did) and bribes of 100s of crores were paid. Similar
to this helicopter deal, Colonel Virendar Jetley left the Army and
joined a Polish arms dealer Bumar as soon as his brother Lt General VK
Jetley became the MGO. General VK Jetley then influenced a 1000 crore
contract for APC carriers benefiting the Poish firm, and routed money
via his brother to three offshore accounts. This thing came out in the
open. But Why did Antony do nothing? Because there was no Italian
court to deal with! No foreigner initiated the enquiry. All these politicians an senior military generals are a bunch of scamsters, looting India when there are so many poor people.
When all defence deals require a commission it is unwise to scrap a
deal on the basis of commission.Thats acting like holier than thou and
giving the deal straight to another criminal who is waiting for the
first deal to be botched.It does not agree with going partway and
accepting three choppers.Evaluation in defence terms is on the basis
of technical superiority.That fact should not be clouded over.
The Financial part with all its troubles should now be gone into by
a independant group of financial experts by both Governments and it
should be resolved.What is at Stake is governmental relations and it
will be damaged totally if the deal is scrapped.
Chopper deal should be scrapped and culprits get punished. It is painful that such things happens at this level.
Its good to find out the malafide contracts but it is important at the same time to allay the fears of business houses/companies ready to deal with Indian government and private players.So we will not lose the valuable foreign investors.
The government should agree for BJP's reasonable demand for SIT under Supreme
Court's supervision. The demand is fair because the specification was changed
during NDA rule and contract awarded during UPA rule. Like in Italy, the
government should immediately legislate banning bribes being indulged by
Corporates and others to secure business within and outside India. It should be
noted that but for the arrest in Italy of the CEO of the helicopter company for
"giving bribes" to secure business, none in India would have had any clue about
the "bribe takers". \
What a bold statement from the Ministry with the show cause notice! From the article it amounts to 300 crores for a chopper. The Govt. has paid 30% (1080crores) against the delivery of 3 choppers. Already thats' 180 crore extra to AW. Good luck with them to scrap the rest of the deal and try to recover the money through international arbitration. A field day for lawyers indeed. We are all being taken for a free ride without a helicopter.
One fails to know why these politicians need such expensive helicopters for their jolly rides at tax payer's cost?It is a shame they find kick backs in every international deal and there appears to be no limit for greed of our polity.
I don't know why India is acting so self-righteous! "Cracking whip, the defense dept issued a show cause notice to the Italian firm"? Get serious! It was Indians who took the bribe, and now India is putting on an act of self-righteous indignation and moral outrage! What stopped these self-righteous indignation from refusing the bribe and exposing the Italian company when the bribe was offered?
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