CBI registers preliminary enquiry into Rolls Royce bribery case

Central Bureau of Investigation on Friday registered a preliminary enquiry into alleged bribery in the Rs 10,000 crore deal of British major Rolls Royce's with state-owned Hindustan Aeronautics Limited (HAL).

The investigating agency registered a PE two weeks after Defence Minister A K Antony had ordered probe in the matter. According to CBI officials, the PE has been registered against unknown officials of HAL, Rolls Royce and the owner of Aashmore Private Limited, Ashok Patni, who is based in Singapore.

"The matter of alleged bribery kickbacks of around Rs 18.8 crore in the supply of the spare parts of helicopter engines to industrial and marine gas turbine division of HAL would be investigated," said a senior CBI official.
As of now, the CBI has not included the name of alleged arms dealer Sudhir Choudharie, who was recently arrested in London, during investigations into the bribery allegations at Rolls-Royce while dealing in China and Indonasia. The serious fraud office was investigating whether Sudhir Choudhrie was an intermediary used by engine and turbine maker Rolls-Royce.
In India, the CBI had booked Choudharie, in 2007, for his alleged involvement in irregularities in defence deals during the NDA regime. However, in 2011, CBI filed a closure report stating that they had no evidence backing the FIR.

After Defence Minsitry ordering probe into the matter earlier this month, Rolls Royce had offered to return the commission paid by India. The CBI has also sought a detailed report through Interpol about Patni and Choudhrie.

The allegations surfaced in the form of a letter received by HAL recently claiming that bribes were paid to officials in HAL and other departments concerned to bag contracts.

Rolls Royce had also conducted an internal audit in which it was found that money had been paid to its commerical advisor -- Aashmore Private Limited -- allegedly as kickbacks to swing the deal in their favour.

Ever since the controversy surfaced, Rolls Royce has maintained that the company "will cooperate fully with the regulatory authorities and have repeatedly made clear that we will not tolerate misconduct of any sort." Rolls Royce, in a letter written to HAL in December last, had said that it had employed a Singapore-based person identified as Ashok Patni and his firm Aashmore Private Limited as "commercial advisor" in India, providing sales and logistical support, local business support and "strategic advice."
The firm also told HAL that it had severed ties with Aashmore and its owner in 2013.
The commissions paid by the firm are in violation of the procurement rules in India which prohibits hiring of middlemen or commission agents while transacting deals with the Defence Ministry.