CBI books Rolls-Royce, unknown officials of HAL, ONGC and GAIL for graft

The Central Bureau of Investigation (CBI) has registered a case of alleged corruption against U.K.-based Rolls-Royce, its Indian arm, a company located in Singapore and unknown officials of the Hindustan Aeronautics Limited (HAL), ONGC and GAIL, in connection with contracts worth thousands of crores.

The FIR follows a preliminary inquiry initiated by the agency in March 2014, based on source information related to 170 contracts between HAL and Rolls-Royce. Among those named as accused in the case are Aashmore Private Limited (Singapore), its then director Ashok Patni and Turbotech Energy Services International, Mumbai.

The CBI has alleged that Rolls-Royce appointed Aashmore, through Mr. Patni, as commercial advisor for providing sales, logistic support, local business expertise and strategic advice in violation of the conditions of purchase orders and integrity pact with HAL.

In the case of supply of spare parts, the British company allegedly paid commissions to Aashmore at the rate of 10-11.3% of the value of purchase orders. They were not declared at the time of execution of contract, the CBI asserted. During the 2007-11 period, ₹18.87 crore was given for 100 orders.

While the Industrial and Marine Gas Turbine unit of HAL had placed orders worth about ₹287 crore from 2005 to 2013, during the same period its Engine division sanctioned orders worth ₹4,456 crore.

The CBI suspects that part of the commission so paid might have been used to bribe unknown HAL officials involved in the procurement process.

The agency alleged that Rolls-Royce had also engaged Aashmore for its services with respect to the supply of spare parts to ONGC, during 2007-11, in alleged violation of the integrity clause. The value of commission, ranging from 10-11.3% of the order amount, was declared in December 2013.

Contracts with GAIL during 2007-11 were also probed. “Rolls-Royce paid commission to Aashmore Pvt. Ltd. In 68 purchase orders for supply of material/spare parts to GAIL... at the rate of 11.13% of the value of order,” the CBI asserted in its FIR.

Turbotech Energy has been arraigned as the agency alleged that it was also engaged by the supplier in 2008-09 for the Vijaypur-Dadri-Bawana Pipeline Project. It declared 2% commission on the bid.

Another company, Infinity — owned by Mr. Patni — was roped in and paid 2% extra for project management services, alleged the agency, again suspecting that part of the commissions might have been paid as kickbacks to unknown officials of ONGC and GAIL.

A Rolls-Royce spokesperson said:

“We are aware of reports that the Central Bureau of Investigation in India has announced a First Information Report relating to the use of intermediaries by Rolls-Royce’s former Energy business in India. This is not about our Defence, Civil Aerospace or Power Systems businesses. We await contact from the CBI and will respond appropriately. We will not tolerate business misconduct of any sort and we are committed to maintaining high ethical standards and no one currently working for Rolls Royce in India played any part in these Energy deals. India is an important market for Rolls Royce and we have a valued workforce of skilled people in the country.”

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Printable version | Nov 20, 2021 4:34:13 PM |

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