Rolls-Royce case: CBI files initial inquiry

Agency names unknown officials of HAL, owner of Aashmore Private Limited Ashok Patni and Rolls Royce

The Central Bureau of Investigation (CBI) on Friday lodged a Preliminary Enquiry (PE) into alleged bribery in the Rs 10,000-crore deal for supply of aircraft engines to state-owned Hindustan Aeronautics Limited (HAL) by London-based Rolls-Royce.

The CBI has named unknown officials of HAL, owner of Aashmore Private Limited, Ashok Patni, and Rolls-Royce in the PE registered after a complaint was received from the defence ministry to look into the supply of engines to HAL.

According to the PE, the agency would be probing alleged payment of bribes or kickbacks in the purchase of spare parts of the engines of the helicopters to the industrial and marine gas turbine division of HAL.     

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

Rolls-Royce had conducted an internal audit in which it was found money had been paid to commerical advisor, Aashmore Private Limited, allegedly as kickbacks to swing the deal in favour of the UK-based company.

The allegation was Aashmore had provided "sales and logistics support, local business expertise and strategic advice" in dealings with HAL in the energy sector.

HAL, through its industrial and marine gas turbine division, buys and maintains gas turbines for Oil and Natural Gas Corporation and GAIL.

Since the controversy surfaced, Rolls-Royce has maintained 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 to HAL in December, had said 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 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.