Millennium Post

After scrapping deal, process on to encash bank guarantee

Estimated to be worth over Rs 3,000 crore, the contract to supply 12 such helicopters were entered into in retired air chief marshal, Pradeep Vasant Naik’s tenure as the chief of air staff (CAS) in 2010.

Three of the choppers have been delivered and the ministry of defence has already paid 45 per cent of the contracted amount. The same deal has been ‘terminated’ on 1 January, 2014 after a meeting between the Prime Minister Manmohan Singh and the defence minister AK Antony.

In the case that is clearly headed to the legal arena, the Anglo-Italian firm, AW has drawn a distinction between ‘termination’ and ‘cancellation.’ While ‘termination’ would mean that the effect of the decision effective 1 January, a cancellation would be ending the contract ab initio i.e. 2010.

This translates into a crucial difference in terms of recovering the full amount that has been paid till now, and the three choppers already in possession of the Indian side.

But importantly that the case is being also investigated by the Central Bureau of Investigation, which though have not been able to file a single chargesheet till date against any of the alleged beneficiaries, known as the Tyagi brothers or even former air chief marshal, Shashi P Tyagi, they do not seem to be the only ones in the ‘food chain.’

This is considering the fact that the Central Vigilance Commission to which the CBI reports, is headed by then defence secretary, Pradeep Kumar, who vetted the contract and the current Comptroller and Auditor General, Shashi Kant Sharma, who had done the same as first, the joint secretary (air) and later in 2010 as director general (acquisition).

It is also important to remember that the ACM (retd) Shashi Tyagi have been hauled over the coals for changing the requirement of head room in the choppers from 4.5 metres to six metres, thus favouring AW 101, could not have functioned on his own without then defence minister’s clearance. The defence minister then was Pranab Mukherjee, now the president.

A source close to ACM (retd) Tyagi told this correspondent that he has a story to tell, but off-the-record.

Considering the fact that a requirement exists for a fool-proof VVIP chopper, speculation is rife in South Block whether now the second lowest bidder, Sikorsky that has a joint venture with the Tata group will be called.

Plus, the air force top echelons are livid at the fact that one of their own has been hung out to dry on the case, while the bureaucrats including the defence finance top honchos who cleared the deal, are not being put on the dock.
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