Role of AgustaWestland middleman in anti-tank missile deal under lens

The security agencies are looking into the alleged involvement of a key accused of the AgustaWestland deal in an anti-tank missile procurement done recently by the Indian Army.

Deal worth Rs 400 crore to buy 240 Spike anti-tank guided missiles (ATGM) and 12 launchers from an Israel-owned company came under scanner after chatters intercepted by the intelligence agencies recently. An investigation was launched after a complaint with the ministry of defence over alleged irregularities in the missile system deal.

In fact, the selection of the ATGM had already raised eyebrows in the ministry of defence as the missile system had failed in multiple tests carried out under Indian conditions over the last few years. Moreover, the issue of arbitrary selection of the firm as the 'single vendor' and opting for the 'refurbished' missile systems for the Army's inventory made the probing agencies suspicious.

Investigating agencies are probing the role of Sushen Mohan Gupta, who was accused of having possession of confidential defense documents and laundering Rs 55.83 crore, allegedly paid as kickbacks to influential people in India for swinging the chopper deal in favour of AgustaWestland. He is suspected to be instrumental in helping the Israeli firm to clinch the anti-tank guided missile system deal.

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In response to question by The WEEK, Army sources admitted selection of the Israeli firm as 'single vendor'.

"We had to go for the Spike ATGM because it was the only missile system available during the time frame required. So, it resulted single vendor situation," an Army source clarified. Sources added the deal happened under the emergency procurement route.

"Missile systems we procured were already in the inventory of the Israeli army. Original equipment manufacturer (OEM) has delivered the in-service missile systems by extending to its full life," Army sources responded to the issue of procuring 'refurbished' missile systems.

Indian Army's original deal to procure over 8,000 Spike ATGM could not go through because the missile systems could not comply on certain parameters during trials. After hard negotiations for over two years, the ministry of defence had to cancel the deal in January last year, a week before Israeli Prime Minister Benjamin Netanyahu was scheduled to arrive in New Delhi.

During the course of ongoing Enforcement Directorate (ED) investigation of AgustaWestland bribery case, it became evident that alleged defence dealer Sushen Mohan Gupta is the kingpin of the entire deal. Documents and diary recovered during multiple raids threw light into the role he played in several other defence deals. The documents also showed his association with a slew of companies—IDS Technologies, Aeromatrix, Interdev and Interstellar Technologies of Mauritius— through which, the CBI and ED alleges, proceeds of the crime have been routed. Another person whose name constantly keep cropping up in the ongoing investigation is that of Sanjeev Tyagi.

During the investigation, the role of a Bengaluru-based company has also came under scanner. Gupta was one of the original promoters of the firm that deals in aircraft simulators and work closely with DRDO, HAL and IAF. Another accused of VVIP chopper deal, Rajiv Saxena, who later turned 'approver' in the case, has disclosed several hidden facts about murky defence deals. Saxena spoke about Gupta's key partner Arvind Khanna, whose father Vipin Khanna was booked by the CBI in the $209 million Embraer aircraft deal. Recently, the ED, in a related case, attached properties worth Rs 15.32 crore under Prevention of Money Laundering Act, 2002 (PMLA), belonging to KRBL Ltd in connection with 2008 Embraer deal case. The ED, in a press statement, said,"It has initiated an investigation under PMLA on the basis of FIR registered by CBI against (i) Embraer SA, Brazil (ii) Unknown Officials of MOD (iii) Vipin Khanna (iv) Interdev Aviation Services Pvt. Ltd, Singapore & others."

The ED alleged that Embraer had engaged Arvind and Vipin Khanna to secure the contract for supplying EMB-145 aircraft to government of India as a platform for Airborne Early Warning & Control (AEW & C) Project. Investigation under PMLA revealed that the accused had laundered kickbacks to India KRBL Ltd via its Dubai based entity KRBL DMCC. The attached assets include land and a rice mill factory located at Tehsil Dhuri, Sangrur district of Punjab.