March 29, 2024

Ex-Indian Air Force Chief Charged in Bribery Case

NEW DELHI — India’s top investigative agency filed a criminal case on Wednesday against a former air force chief and 11 other people on charges of cheating and conspiracy in a $750 million helicopter deal marred by bribery.

The Central Bureau of Investigation filed the charges under India’s corruption prevention laws against Shashi Tyagi, three of his cousins and officials of four defense companies after an investigation revealed that huge bribes were paid to steer the contract to the Italian defense group Finmeccanica’s helicopter division, AgustaWestland.

The agency searched the homes and offices of Mr. Tyagi and his cousins, who it suspects were among those who received bribes to clinch the purchase of 12 helicopters two years ago.

India’s Defense Ministry received three of the helicopters in December but has placed the rest of the contract on hold.

Among the 12 people involved in the case is Satish Bagrodia, the brother of a former federal minister, Santosh Bagrodia, who belongs to India’s governing Congress party.

The C.B.I. said it filed the criminal charges based on evidence it had gathered from the men and from documents it obtained from Italy. The Defense Ministry indicated that alterations were made in the helicopter specifications to favor AgustaWestland.

The inquiry into the helicopter contract began last month after Italian authorities arrested Giuseppe Orsi, the chief executive of Finmeccanica, in Italy on charges that the company paid bribes in India. Mr. Orsi, who has been jailed, denies wrongdoing.

Italian authorities also placed the head of AgustaWestland, Bruno Spagnolini, under house arrest.

Mr. Tyagi has also denied any wrongdoing in the case and said decisions on the helicopter deal were made before he assumed the top job in the air force.

The agency said Finmeccanica paid a commission to three middlemen who channeled the illegal payments through Tunisia and Mauritius to two India-based companies as payments for an engineering contract. Those companies and two Indian men associated with them were among those named as accessories in the case.

India has become the world’s biggest arms and defense equipment buyer in recent years and is expected to spend $80 billion over the next 10 years to upgrade its military.

Arms deals in India have often been mired in controversy, however, with allegations that companies have paid millions of dollars in kickbacks to Indian officials.

In the 1980s, the government of -Prime Minister Rajiv Gandhi government collapsed over charges that the Swedish gun manufacturer Bofors paid bribes to supply Howitzer field guns to the Indian army.

Following the Bofors scandal, India banned middlemen in all defense deals.

The developments in the Finmeccanica case come at a time when New Delhi and Rome are entangled in a diplomatic dispute after Italy’s refusal this week to return two Italian marines facing trial in India for the killing of two fishermen off the southwest Indian coast last year.

The case is also a major embarrassment for Prime Minister Manmohan Singh’s government, which has been buffeted over the past year by a string of corruption scandals ahead of national elections scheduled in the first half of next year.

Article source: http://www.nytimes.com/2013/03/14/business/global/ex-indian-air-force-chief-charged-in-bribery-case.html?partner=rss&emc=rss

India Ink: Indian Court Issues Warrant for Porsche C.E.O.’s Arrest

Matthias Mueller, chief executive of Porsche, posing inside a 911 sports car, at the company's headquarters in Stuttgart, Germany on Jan. 9.Kai Pfaffenbach/Reuters Matthias Mueller, chief executive of Porsche, posing inside a 911 sports car, at the company’s headquarters in Stuttgart, Germany on Jan. 9.

An Indian court has issued an arrest warrant for Matthias Müller, chief executive and chairman of Porsche, the German carmaker, and eight other executives from the company.

The warrants come as a result of a court case filed by Precision Cars India, a former importer of Porsche autos based in New Delhi.

Precision Cars began importing Porsche vehicles to India in 2003. When Porsche appointed Volkswagen Group Sales India as its sole importer in April 2012, however, it failed to inform Precision Cars, the importer said. Precision executives said they were left with no choice but to file a lawsuit.

“All along we have been making bona fide efforts to sort out the issues with Porsche,” Precision Cars India said. “But they are acting in an illegal and unjust manner and have not been giving any support in resolving the issues, so we were not left any choice but to pursue the matter legally and await justice.”

The arrest warrants, issued in Jaipur, were based on several charges filed by Precision against Porsche, including extortion, cheating, dishonestly inducing delivery of property, criminal breach of trust and criminal conspiracy.

Mr. Müller, speaking at the North American International Auto Show in Detroit, said that lawyers were investigating the issue and that he had no further comment.

Because the accused executives are originally from Germany and the United Arab Emirates, India’s Central Bureau of Investigation has written to Interpol a letter dated Nov. 8, 2012 asking that “necessary action in the matter” be taken up with the concerned countries.

From January 2011 to March 2012, Precision Cars sold an average of 35 cars per month. During Porsche India’s first month of working with Volkswagen in India, in October 2012, the company sold 117 cars, followed by 51 cars in November.

Article source: http://india.blogs.nytimes.com/2013/01/15/indian-court-issues-warrant-for-porsche-ceos-arrest/?partner=rss&emc=rss