India has decided to appeal against the Italian court verdict barring the country from encashing bank guarantees worth 278 million euros after scrapping AgustaWestland VVIP chopper deal.
New Delhi, March 18/Nationalturk – With an Italian court barring India from encashing bank guarantees worth over Rs. 2,360 crore Indian currency ( 278 million euros) of AgustaWestland after scrapping VVIP chopper deal, India has decided to appeal against the Italian court verdict.
“The Government of India will be filing an appeal against the order of the Italian Court in Milan in the case relating to encashment of bank guarantees in the contract for the procurement of 12 VVIP/VIP helicopters from AgustaWestland International Ltd. (AWIL),” an Indian defence spokesman said today.
He said Indian government will vigorously pursue all options for encashment of the bank guarantees.
In January this year, India cancelled the Rs. 3,600 crore (560 million-euro) order with Finmeccanica unit AgustaWestland for 12 top-end helicopters, citing a breach of integrity relating to alleged corruption.
Indian encashed bank guarrantes
After the scrapping of deal, India encashed bank guarantees of around Rs 2.4 billion Indian rupees deposited in banks in India but it is yet to recover the bank guarantees deposited in banks of Italy.
An Italian court in Milan on Monday accepted a plea by AgustaWestland’s parent company Finmecannica to stop India from encashing over Rs. 2,360 crore (Euro 278 million).
“With this measure, the Court granted the requests made by the companies of the Finmeccanica Group, recognising the manifestly abusive enforcement of the guarantees made by the Indian defense ministry, given the vagueness of the complaints made in relation to alleged breaches of contract,” Finmeccanica said in a statement.
It further said the court has confirmed the ruling made last January, prohibiting the payment of collateral of more than 278 million euros deposited in relation to the contract.
India had decided to go for arbitration with Italian firm
After the cancellation of the contract, India had also decided to go in for arbitration with the Italian firm and the two sides have nominated their members in this regard. India has agreed to AgustaWestland’s calls for arbitration, which will take place in India and could take months or even years to complete.
India signed a deal with AgustaWestland in 2010 to buy 12 top-end helicopters for use by VVIPs including the President of India for Rs. 3,600 crore. According to media reports, Agusta has already supplied three choppers to India but the delivery of the remaining nine was put on hold after Indian Defence Minister AK Antony ordered an inquiry into the chopper deal through its premier investigative agency Central Bureau of Investigation (CBI).
In March 2013, CBI said that four firms and 12 individuals, including former Indian Air Force Chief SP Tyagi, are being investigated. The former air force chief has, however, denied any wrongdoing.
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