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Law ministry looking into Bofors twist: Pranab

Last Updated: Tuesday, January 4, 2011 - 22:22

New Delhi: Finance Minister Pranab Mukherjee
on Tuesday said the government is examining the decision of the
Income Tax tribunal in the Bofors case and will decide the
future course of action later.
"As the Law Ministry has pointed (out), we are examining
the (Bofors) papers. After that it will be seen," he told
reporters when asked about the future course of action by the
government on the recent ruling of the Income Tax Appellate
Tribunal (ITAT) in the Bofors case.

In its ruling, the ITAT had said that kickbacks of Rs 61
crore were paid to the late Win Chaddha and Italian
businessman Ottavio Quattrocchi in the Howitzer gun deal and
they are liable to pay tax in India on such income.

The order further said, "... Inaction in this regard may
lead to a non-existent undesirable and detrimental notion that
India is a soft state and one can meddle with its tax laws
with impunity."

While responding to BJP allegations of corruption against
the Congress in the Bofors case, Law Minister M Veerappa Moily
had said yesterday, "I don`t think there is any issue to be
made out. As far as the order is concerned, we will look into
In the order, the tribunal details the denials by gun-
maker Bofors about the existence of middlemen in the 1986 deal
valued at Rs 1,437 crore and the efforts by Quattrocchi and
Chaddha to open a series of accounts to transfer funds in an
attempt to obliterate the money trail.

Holding that Bofors should have reduced the commissions
paid from the total contract value, the tribunal observed that
the government had to pay an excess amount of about Rs 41
crore, which was passed on to Chaddha and Quattrocchi in
violation of the terms of the contract.

Quattrocchi, known to be close to the Gandhi family, left
India in 1993 even as a CBI case was filed over kickbacks
being paid under the deal.


First Published: Tuesday, January 4, 2011 - 22:22
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