2013 Indian helicopter bribery scandal

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India signed a contract in February 2010 for 12 AgustaWestland AW101 helicopters, depicted here.

In early 2013, an Indian parliamentary investigation began into allegations of bribery and corruption involving several senior officials and helicopter manufacturer AgustaWestland surrounding the purchase of a new fleet of helicopters. The scandal has been referred to as the Chopper scam, or Choppergate by elements of the media and popular press.[1]

Several Indian politicians and military officials have been accused of accepting bribes from AgustaWestland in order to win the 36 billion (US$540 million) Indian contract for the supply of 12 AgustaWestland AW101 helicopters; these helicopters are intended to perform VVIP duties for the President of India and other important state officials.[2] Ahmed Patel political secretary to Congress President Sonia Gandhi is alleged by Italian prosecutors to have received kickbacks from the deal.[3] A note dating back to 15 March 2008 presented in the Italian court also indicates that Congress Party President Sonia Gandhi is the driving force behind the VIP chopper purchase. And it further asks middleman Peter Hulett to target key advisors to Sonia Gandhi and lists the names of Prime Minister Manmohan Singh, Ahmed Patel, Pranab Mukherjee, M. Veerappa Moily, Oscar Fernandez, M. K. Narayanan, Vinay Singh. The note also contains the bribes to be paid out divided as, "AF" €6 Million, "BUR" €8.4 Million, "Pol" €6 Million and "AP" €3 Million.[4][5][6]

On 25 March 2013, India's Defence Minister A.K. Antony confirmed corruption allegations by stating : "Yes, corruption has taken place in the helicopter deal and bribes have been taken. The CBI is pursuing the case very vigorously".[7] As of June 2014, Indian government has recovered a total amount of 2068 crore[8] and has recovered the entire amount of around 1620 (45% of total contract value 3600 crore) it had paid to AgustaWestland.[9]

Overview[edit]

India signed a contract to purchase 12 AgustaWestland AW101 helicopters in February 2010 for the Communication Squadron of Indian Air Force, to carry the president, PM and other VVIPs. Controversy over the contract came to light on 12 February 2013, with the arrest of Giuseppe Orsi, the CEO of Finmeccanica, AgustaWestland's parent company by Italian authorities;[10] the following day Indian Defence Minister A.K. Antony ordered a probe into the contract.[11] A chandigarh based company, IDS infotech was used for routing kickbacks to India.[12] The role of Satish Bargodia (brother of ex-Union Minister Santosh Bargodia) who is also the director of the company is being investigated. In 2005 just few years before the scam Pratap Agarwal brought son of Satish Bargodia as it's director. It is alleged that using the political connection of Satish, IDS a rather unknown firm managed to bag such a huge deal [13]

This is not the first time that business ventures of Santosh Bagrodia’s brothers have landed him in controversy. In the coal block allocation scam, allegations were leveled against Santosh Bagrodia over a Rs. 600-crore mining contract awarded by a unit of state-owned Coal India Limited during his tenure in the coal ministry to Cuprum Bagrodia, a company of another of his brothers, Vinod. Santosh was coal minister between April 2008 and May 2009.[13]

CBI investigation[edit]

After a huge controversy and allegations of corruption,[14][15] Defence Minister A.K. Antony, on 12 February, ordered an investigation by the Central Bureau of Investigation (CBI).[16][17]

First Information Report (FIR)[edit]

On 25 February 2013, CBI registered a Preliminary Enquiry (PE) against 11 persons, including the former Indian Air Force Chief, Air Chief Marshal S.P. Tyagi, and his cousins, besides four companies.[18] After carrying out the preliminary enquiry, the CBI found sufficient evidence and registered an FIR on 13 March. The FIR named 13 persons including: former Indian Air Force Chief, Air Chief Marshal S.P. Tyagi, his three brothers: Juli, Docsa and Sandeep, brother of former Union minister Santosh Bagrodia, Satish Bagrodia, Pratap Aggarwal (Chairman and Managing Director of IDS Infotech). The FIR also named four companies - Italy-based Finmeccanica, UK-based AgustaWestland and Chandigarh-based IDS Infotech and Aeromatrix.[19][20]

Joint Parliamentary Committee (JPC) investigation[edit]

On 27 February 2013, UPA-II Government introduced a motion in Rajya Sabha (the upper house of the Parliament of India) for an investigation led by a 30-member Joint Parliamentary Committee (JPC). The motion was passed after a walkout by most of the opposition parties like BJP, JD(U), Trinamool Congress, CPI, TDP and AGP.[21][22] During the debate, Leader of the Opposition Arun Jaitley said the JPC was an "exercise in futility" and "diversionary tactic". He argued that the case involved various legal aspects such as extradition of accused foreigners and custodial interrogation and the JPC can have "none of these powers", leaving it ineffective. Many opposition members demanded Supreme Court-monitored investigation (on the similar lines of 2G spectrum scam). Demands were also made to establish money trail and issue Letter Rogatory (LR).[21]

The UPA government initially denied all allegations and claimed it has "nothing to hide" and that "our track record is not cover up".[21]

A complaint has been filed seeking an investigation into the sale of 21 civil helicopters worth over Rs 7,000 crore (US$1.6 billion) by AgustaWestland between 2005-2013 in India. As per the complaint Agusta Westland has been selling civil helicopters in India through its agent Sharp Ocean Investments Limited, which is promoted by twin brothers Nayan Jagjivan and Nakul Jagjivan. Tax authorities in India have been asked to probe the possibility of tax evasion by Sharp Ocean on the commission received for the sale of helicopters and foreign exchange deprivation to the country by off-shoring payments for the sale of helicopters in India.[23]

Separately, the Comptroller and Auditor General, in its latest report, has indicted the Chhattisgarh government for overpaying Rs.65 lakh (US$120,000) for the purchase of a VVIP chopper -an Agusta A-109 Power helicopter from Sharp Ocean Investment Ltd and its India representative, OSS Air Management.[24][25] Both companies are promoted by twin brothers Nayan Jagjivan and Nakul Jagjivan.

Cancellation of the contract by the Indian Government[edit]

India cancelled the 3,600 crore deal with AgustaWestland in January 2014. The government cancelled the contract "on grounds of breach of the Pre-contract Integrity Pact and the agreement by AWIL (AgustaWestland International Ltd)". The contract was frozen in February 2013 after allegations surfaced that Rs 360 crore was paid as bribe. [26]

Role of Union Law Ministry and Indian President in CBI probe[edit]

The CBI approached Union Law Ministry to record statements of M. K. Narayanan and B V Wanchoo in January 2014.[27] M K Narayanan and B V Wanchoo were West Bengal and Goa Governors respectively at the time of CBI's request. Their statements were considered vital as they were national security adviser and Special Protection Group (SPG) chief at the time of signing of contract with AgustaWestland. Their views were also considered before Indian Government signed the contract with AgustaWestland. However Kapil Sibal's Union Law ministry stonewalled CBI probe by rejecting CBI's request to examine them under the usual excuse of 'immunity'. The CBI therefore approached President Pranab Mukherjee to seek permission to examine ex-NSA and ex-SPG.[28] M. K. Narayanan and B V Wanchoo were questioned by CBI later in June 2014 & July 2014 respectively.[29][30]

Recovery of Bank Guarantee[edit]

After the cancellation of the contract, India encashed over 250 crore made by AgustaWestland as bank guarantee in the Indian banks in January 2014.[31] Separately, India requested the Italian government to retrieve the bank guarantee amount made by the firm in Italian banks which was more than €275 million (2364 crore).[32][33] On 17 March 2014, request made by India was rejected by an Italian court.[34] However, the appellate court, Milan reversed the lower court's judgement and upheld the claims of the Indian government.[35] Accordingly, in June 2014, Indian government encashed 1818 taking the total amount recovered so far to 2068.[8] With this, India has recovered the entire amount of around 1620 (45% of total contract value 3600 crore) it had paid to AgustaWestland.[9]

References[edit]

  1. ^ "SEARCH RESULTS FOR Choppergate". India Today. Retrieved 4 March 2013. 
  2. ^ Kumar, Vinay (18 February 2013). "Chopper scam: Long-drawn legal battle ahead". The Hindu (Chennai, India). Retrieved 25 February 2013. 
  3. ^ http://indianexpress.com/article/india/india-others/does-ap-mean-ahmed-patel-asks-prosecutor-in-italy-court-middleman-says-dont-know/
  4. ^ http://indiatoday.intoday.in/story/agustawestland-vvip-chopper-scam-note-sonia-gandhi-manmohan-singh/1/341261.html
  5. ^ http://ibnlive.in.com/news/agustawestland-scam-has-upa-subverted-india-into-a-kleptocracy-asks-jaitley/449527-37-64.html
  6. ^ http://www.firstpost.com/india/target-sonia-her-key-advisers-middleman-told-agustawestland-1370205.html
  7. ^ "Bribes were taken in the VVIP helicopter deal, admits Defense Minister AK Antony". India today. 25 March 2013. Retrieved 19 March 2013. 
  8. ^ a b "India recovers Rs.1,818 crore from AgustaWestland". Retrieved 8 June 2014. 
  9. ^ a b "India Scraps Rs.3,600 crore AgustaWestland Chopper Deal". Retrieved 8 June 2014. 
  10. ^ Emilio Parodi and Stephen Jewkes (12 February 2013). "Finmeccanica head arrested over India bribe allegations". Reuters. 
  11. ^ "VVIP chopper deal scam: Italy arrests Finmeccanica CEO, India orders CBI probe". ZEE News. 13 February 2013. Retrieved 28 February 2013. 
  12. ^ http://timesofindia.indiatimes.com/india/Choppergate-ED-arrests-businessman-Gautam-Khaitan/articleshow/43266860.cms
  13. ^ a b http://www.hindustantimes.com/newdelhi/ex-minister-s-kin-on-board-of-choppergate-it-company/article1-1013101.aspx
  14. ^ "Chopper Deal: BJP Attacks UPA, Says It's 'Raining Scams'". 15 February 2013. Retrieved 5 October 2013. 
  15. ^ "St Antony needs to be decanonised". 13 February 2013. Retrieved 5 October 2013. 
  16. ^ Kumar, Vinay (13 February 2013). "CBI probe ordered". The Hindu (Chennai, India). Retrieved 5 October 2013. 
  17. ^ "Italy arrests Finmeccanica CEO, India orders CBI probe". 13 February 2013. Retrieved 5 October 2013. 
  18. ^ Pandey, Devesh K. (25 February 2013). "CBI names Tyagi, cousins in PE". The Hindu (Chennai, India). Retrieved 5 October 2013. 
  19. ^ "CBI registers FIR against former Air chief SP Tyagi". The Times Of India. 13 March 2013. Retrieved 5 October 2013. 
  20. ^ "CBI files FIR against Air Force ex-chief SP Tyagi, 11 others". 13 March 2013. Retrieved 5 October 2013. 
  21. ^ a b c "Parliament passes JPC probe into chopper scam". Indian Express. 27 February 2013. Retrieved 28 February 2013. 
  22. ^ "Govt adopts motion for JPC probe, opposition walks out". FirstPost. 28 February 2013. Retrieved 4 March 2013. 
  23. ^ Probe sought into the other Agusta deal
  24. ^ [1][dead link]
  25. ^ "The Week | Choppy deal". Week.manoramaonline.com. Retrieved 2013-11-28. 
  26. ^ "Rs 3,600 crore VVIP chopper deal with AgustaWestland scrapped in view of bribery allegations". The Times Of India. 2 January 2014. 
  27. ^ "CBI seeks Home, Law ministries’ advice to examine B V Wanchoo, M K Narayanan". 
  28. ^ "VVIP chopper deal: CBI seeks President's permission to question Narayanan, Wanchoo". The Times Of India. 
  29. ^ "CBI questions West Bengal governor M K Narayanan as witness in VVIP chopper deal". Patrika Group. 28 June 2014. Retrieved 4 July 2014. 
  30. ^ "Goa Governor, Questioned By the CBI in AugustaWestland Chopper Deal, May Resign". Patrika Group. 4 July 2014. Retrieved 4 July 2014. 
  31. ^ "India encashes over Rs250 cr bank guarantee of AgustaWestland". Retrieved 8 June 2014. 
  32. ^ "AgustaWestland deal: Italy court rejects India’s plea to recover bank guarantee". Indian Express. 18 March 2014. 
  33. ^ "Italy judge rejects India bid to recover AgustaWestland guarantees". NDTV. 18 March 2014. 
  34. ^ "Italy judge rejects India request to recover AgustaWestland guarantees: Sources". Times of India. 18 March 2014. 
  35. ^ "India to encash 228 m euros bank guarantees of Agusta". Retrieved 8 June 2014. 

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