India to cancel VVIP chopper deal with Finmeccanica`s AgustaWestland: Report

India has decided to cancel a scandal-tainted helicopter deal with Anglo-Italian firm AgustaWestland, a news agency said.

Last Updated: Nov 19, 2013, 20:40 PM IST

Zee Media Bureau

New Delhi: India has decided to cancel a scandal-tainted helicopter deal with Anglo-Italian firm AgustaWestland, a news agency said on Tuesday.

The report comes a day ahead of a scheduled meeting between Defence Ministry officials and the company executives on Wednesday.

Facing the threat of cancellation of its Rs 3,600 crore deal for supplying VVIP choppers to the Air Force, the Anglo-Italian firm will present its case before officials of the rank of Additional Secretary and Joint Secretary of the Defence Ministry, who have been dealing with the case after the scandal broke out, Defence Ministry officials said.
The decision could re-open the contract to rivals, including United Technologies Corp`s Sikorsky Aircraft, EADS` Eurocopter and Lockheed Martin.

On October 30, Defence Minister AK Antony maintained that AgustaWestland "violated the contract" for supplying 12 VVIP choppers to the Indian Air Force and the government has to move as per the law.

On October 21, the Defence Ministry had issued a final showcause notice to AgustaWestland, seeking to cancel the deal to buy 12 helicopters and given the company 21 days to reply.

The company was asked to explain why action should not be taken against it for violating the terms of the pre-contract integrity pact.

In February, the government froze payments on the USD 771.32-million contract following allegations that Rs 360 crore was paid in bribes.

AgustaWestland has denied the allegations. Former IAF chief SP Tyagi is among those under cloud in connection with the kickback charges.

(With Agency inputs)